Time to Balance Out the Crazyness

Okay, so maybe I should add something sane to the portfolio, like say, consumer staples. The speculative plays turned out to be a good exercise in market timing, and the portfolio is back in the green, and the market is perhaps a bit high on a bear market rally, so I should add something that is stable and won't kill me if the market heads back down. Some of this data is a few days old now, but oh well, I don't want to go back and look up the ratios again.

WMT walmart 2.19% ***** hi div growth PE 14.46 PB 3.8 Beta: .21 ANALYSTS:1.83 mod buy
CL colgate 3.08% ***** growth PE 16.02 PB ?16 Beta .6 ANALYSTS: 2.07 outperform
PG proctor/gamble 3.45 ***** growth PE 12.84 PB ?2.27 Beta .63 ANALYSTS:2.53
KFT kraft 5.24 *** growth PE 18.12 PB 1.45 Beta .66 ANALYSTS: 2.47
CAG con-agra 5.21 3 yrs ago cut PE 13.55 PB 14.43 Beta .68 ANALYSTS: 3
DD Dupont 7.64 slow growth PE 8.29 PB 7.21 Beta 1.19 ANALYSTS: 2.5

PEP pepsi 3.48 *****
16/20 3/5yr div growth, 50% payout ratio, 39% ave 5 yr
PE 14.86 PB 14.46 Beta .58 ANALYSTS:2 outperform

KO Coca-Cola 3.9 *****
10.6/11.1 div growth rate 3/5 yr 60% payout ratio average 5 yr 55%
PE 16.76 PB 12.1 Beta .57 ANALYSTS: 1.92 outpreform

CVS caremark 1.15 growth recently PE 12.07 PB 1.15 Beta .81 ANALYSTS: 1.62 mod buy

GIS *** 3.65 steady growth PE 14.73 PB 3.32 Beta .35 ANALYSTS: 1.82 mod buy
7.1/8.04 3/5 yr div growth, 45% payout ratio average 5yr 43% 5yr ave yield 2.5%

K 3.72 growth PE 12.41 PB 9.76 Beta .45 ANALYSTS: 1.8 mod buy
14/7.8 3/5 yr growth, 54% payout ratio, average 5 yr 47% 5yr ave yield 2.6%

At some point I started using PB instead of Tangible PB, which has skewed these numbers a bit. I decided that since some did not list a tangible PB I would just use the PB value... but some of these are tangible values (the high ones) and I am too lazy to go back and change them... so there. I stated out PEP, KO, GIS, and K a bit more than normal because I wanted to be able to compare them, i only want one cereal company and one cola company.

Oh, and on a side note I would like to add a position in MMM if it looks viable. I had been looking at MMM and GE as two large conglomerates, and MMM certainly looks more appealing than GE at the moment (no dividend cut!).

MMM 4.1% yield ***** 6% 3yr div growth rate
PE 10.07 PB 3.45 Beta .63 ANALYSTS: 2.6 hold

So, most of these companies above are rather big names, and that is good! Hopefully I won't have to worry too much about shooting myself in the foot here.

Okay, so, 1yr chart. Everyone outperforms, especially WMT and KFT. There is one exception: DD gets the stuffing kicked out of it. I should probably look into that.

6months: ditto, KO better than kraft, closer grouping (less time to spread).

5yr chart: a bit more interesting, only GIS, PEP, and K seem to outperform consistently.

I looked into DD's financial statements: I bet the fact that they had a rather negative EPS last quarter accounts for the large stock price pummeling. Also, large jump in other liabilities and large drop in other equity- I think I'll stay away from that one as I'm not sure whats going on.

I think I will take GIS and PEP based on payout ratios, long term div growth, and the 5 yr chart. I also like KFT and WMT. PG and CL also seem to have preformed well. I have mixed feelings about CAG, as it has high yields but it seems to track the market, not beat it. With a 5% yield however, I guess that may be acceptable.

This is the first list I made where I didn't immediatly see lots of problems to throw out! I think just start small 10k positions in PEP,GIS,KFT,WMT,PG, and CL. That should provide some stability to compensate for the shipping and real estate segments of the portfolio.

Oh... what about MMM? It's chart doesn't look very impressive over the last few years, although it preformed well several years back, making the ten year chart look good. It has been paying dividends forever however... but it doesn't grow them very fast or normally have a very high yield. I guess I just don't see much motivation for out performance, it will probably recover with the market as a whole.

Okay, next time maybe I will make an update on what positions are held and their profit status. Or maybe not. I dunno.

Remember: I don't know jack about investing don't base any decisions on my nonsense!

Even More Speculation

Okay, might as well buy some REIT's while I'm buying things that have had the crap beaten out of them.

HPT 33% - div higher than EPS expect cut to about 5% yield
PE 8.66 PB .35 Beta 1.5 ANALYSTS: 2 Outperform Market Cap:853M

NRF 72%! Expect cut!? Looks like they sold something big off to pay down debt? Abnormally large EPS and drop in liabilities?...
PE .11!! PB .05!! Beta 1.85 ANALYSTS: 2.57 hold Market Cap: 87M

UHT 9.54% (saneish- still probably will be halved... low EPS)
PE 19.98! PB 2.16 Beta .72! ANALYSTS: none Market Cap: 307M

O 10.88% (again div above EPS-halved?)PE 18.27 PB 1.15 Beta .97
ANALYSTS:2.58 hold Market Cap: 1.6B

IRC 16% again div>EPS expect drop to 5%ish PE 13.75 PB 1.4 Beta 1.28
ANALYSTS: 2.75 hold Market Cap:406M

My initial impulse is to take the stocks that have managed to retain a reasonable PE ratio, as the market knows more than I do about RIETS. Prehaps I should just look into an ETF for this... but why do that when it's not real money anyhow!

Charts!
6months: O and UHT outperformed. NRF was beasted.

2yr: Again O and UHT outperform. NRF and HPT get decimated.

Well, the charts and the ratios give me a good feeling about O and UHT. HPT has a good analyst recommendation and is not exactly a lightweight with its 800M market cap, so I'm tempted to say its too big to fail- but I haven't actually looked into that at all so I can't! They did recently beat expectations and post a rise in 4th quarter profits however. I suppose I don't really have any better ideas for RIETs and am too lazy to look around. I'll toss 10k at each of these and I can fill out the rest of my RIET position later. I just want to get a toehold in while the market is going to heck.


EDIT: I found one more nice looking candidate.

ESS 7.47% raised dividend, dividend achiever, still a bit low EPS however
PE 26 PB 1.5 Beta 1.08 Analysts 2.2 outperform

On the chart it outperformed until recently, where it took a beating. Ratios seem strong and dividend increase is a good sign. I think I will buy in a 10k position here as well.

More Speculation

So, the market is abysmal at the moment. That of course means a huge buy signal to me, as I am not even using real money. I might as well pick some really beaten down speculative areas while I am at it: how about shipping companies?

Shipping first for starters:

GMR 28%!, PE 10.29 PB -- Beta 1.19 Market Cap: 447M
2 yrs at 50c/quarter - high payout ratio? ANALYSTS 2.57

KSP 20%! PE 13.07 PB 1.08 Beta .5! Market Cap: 222M ANALYSTS: 1.43 mod buy!
4 year dividend history with no major cuts

NAT 22%! PE 6.89 PB 1.13 Beta .95 Market Cap: 891M ANALYSTS:3.3 hold/underpref
History of reasonable but changing dividends

SFL 9.23% PE 13.15 PB 1.02 Beta 1.62! Market Cap:7.8B! ANALYSTS:2.5 outpref/hold
reasonable history of dividend payouts- ship financing company for FRO I believe

DAC 58%! PE 1.53 PB .37 Beta .6! Market Cap: 210M
ANALYSTS:2.5 outpref/hold debt/assets about 1:1

PRGN 65%! PE 1.38 PB .3 Beta .46! Market Cap: 93M ANALYSTS:2 outperform
1yr of constant dividend

DHT 23%! PE 4.03 PB 1.2 Beta .85 Market Cap: 163M ANALYSTS: 1.67 mod buy!
3yrs fluctuating dividend

ESEA 10.64% PE 5.34 PB .48 Beta: .02? impossible! Market Cap: 126M
ANALYSTS:1.67 mod buy! recent cut but still reasonable yield- no more cuts?

VLCCF 9.02% PE 4.29 PB .93 Beta:1.35 Market Cap: 206M ANALYSTS: 3 hold
recent cuts, still reasonable yield - worrysome dividend shrinkage


So, lots of very low PE and PB's. Either these are steal opportunity values, or the market doesn't see them making much growth in the future. Also, lots of absurdly high dividend yields that we can probably expect to be cut- at the same time however, I doubt the earnings per share have taken as large a hit as the share price has, so more dividend may be supportable than the percentage indicates. Initially, I am biased towards the lower yields and higher market caps. Also, I wonder about those stocks with betas less than one... that seems unlikely.

6month chart: NAT and KSP outpreform. DAC and PRGN get annihilated.
5yr: SLF,NAT,VLCCF outpreform GMR preforms well until recently.

KSP and NAT's low betas seem justified. SLF's high beta seems unjustified. DAC and PRGN's low betas seem preposterous.

So I'm thinking the shotgun approach is what we want in this turbulent market. How about we just grab GMR,NAT,SLF,VLCCF, and KSP. That should give us a good toehold. 10k of each? Sounds like a start. I'm feeling too lazy to look into financials tonight- if it was real money I would, but if it was real money I would research a heck of a lot harder on each.