Early Retirement Extreme Forums

Gilberto de Piento wrote: ↑

Thu Jul 12, 2018 8:08 am

How much time do you put into selecting the stocks in the first place and then reviewing them to make sure that you don't need to sell them? Or do you hold forever no matter what?

I like to find a stock that is entering value territory for non-company-specific reasons and then sit and watch it for a while. How long I watch depends on the stock. Some stocks might have a very temporary dip as the market dips as a whole. CLX is a good example earlier this year. Now it is rising again. Other's are being affected by sector issues and will decline for quite a while. KHC, WBA and CVS are good examples. These are safe to watch for quite a while before initiating because they will likely drift lower for longer than you expect. Others might never enter value territory. They shouldn't be bought.

Bottom line is, though, if you focus on the fundamentals and your own personal rules and pick solid companies, a temporary loss of capital value shouldn't worry you. It should get you to buy more stock.

I like to find a stock that is entering value territory for non-company-specific reasons...

What is the source for your method?

I requested a number of dividend stock books at the library (though they didn't have the one C40 mentioned).

Gilberto de Piento wrote: ↑

Fri Jul 13, 2018 1:07 pm

I like to find a stock that is entering value territory for non-company-specific reasons...

What is the source for your method?

Dividend Growth Investor has turned into one of my primary sources for alerts on what to look at. From there I do my own looking/watching/waiting thing.

Fidelity has a fantastic stock screening tool as well. You need to create an account to access it.

@Cmonkey

What do you think of Altria Group and British American Tobacco?

Based on the book by C40, they meet all the criteria: Earnings Growth >5%, Equity>Debt, Payout Ratio <50%, Cash Flow >3X interest payments, Credit Rating>= BBB+, Current Div >1.5x S&P Yield.

Plus, I've wanted to hold tobacco stocks for a while and this dip seems like an opportunity to purchase them.

I'm looking into putting about 15% of my assets into a portfolio of 10-30 dividend stocks and building this up to 25-50% of my portfolio if I end up doing well.

Tobacco use is declining from what I understand so if you invest in that sector, pick the rock solid companies that are diversifying and have strong balance sheets.

Of course this could all change as millennials age and a new, rebellious youth become young adults...