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Recent Tweets

Reviewing Oxy’s Dividend Safety After $38 Billion Bid for Anadarko

Shortly after Anadarko (APC) agreed to be acquired by Chevron (CVX), Occidental Petroleum (OXY) offered $38 billion to buy Anadarko in a deal valued 20% higher than Chevron's agreement. Oxy has now made a total of three acquisition proposals to Anadarko since late March, and each was higher than the deal announced with Chevron on April 12, according to a letter written by the company to Anadarko.  For whatever reason, Anadarko appears to prefer teaming up with Chevron and even agreed to pay the company a break up fee of $1 billion (about $2 per share) if their deal were to fall through. However, Oxy's significantly higher offer could finally be enough to sway Anadarko's board.

April 24th, 2019|

Why Mortgage REITs Like Apollo Commercial Appear Riskier

Given the historically low nature of interest rates, many income investors have flocked to high-yield industries like mortgage REITs, or mREITs. Apollo Commercial Real Estate (ARI) is one popular mREIT, thanks to its 10% dividend yield.However, while this stock might be an acceptable choice for higher risk investors during a strong economy, it isn't a great choice for conservative income investors who seek stable income throughout the entire economic cycle, including during recessions. Let's take a closer look at why that appears to be the case. 

April 24th, 2019|

W.P. Carey: Higher Dividends for Over 20 Consecutive Years

W.P. Carey (WPC) was founded in 1973 by Bill Carey, who helped to pioneer the triple net lease and sale-leaseback REIT business model. W.P. Carey went public in 1998 as a master limited partnership but converted to a REIT in 2012.Today the REIT owns over 1,100 properties located in 25 countries around the world. W.P. Carey's portfolio is broadly diversified across tenants (over 300, none greater than 4% of rent), industries (over 25), property types (industrial, office, retail, storage), and geographies (37% of sales are outside of the U.S., primarily in Western and Northern Europe).

April 24th, 2019|

STORE Capital: A REIT Held By Warren Buffett

STORE Capital (which stands for Single Tenant Operational Real Estate) is a relatively new triple-net lease REIT, having gone public in 2014. However, the company is led by an experienced management team that previously built three successful triple net lease REITs (FFCA, Spirit Finance, STORE Holding) and has invested over $17 billion in more than 9,600 properties.STORE owns over 2,200 properties leased under long-term contracts (average remaining lease duration is 14 years) to more than 400 companies operating across roughly 100 industries. The REIT mostly serves middle market businesses, with its median tenant generating just over $50 million in annual revenue. 

April 24th, 2019|

UnitedHealth’s Sell-Off Highlights Fears About Healthcare Reform

On April 16, United Healthcare (UNH) reported earnings that spooked some investors as its share priced plunged as much as 7% at one point. That decline added to several months of weakness that resulted in the company's stock price falling more than 20% from its all-time high. Let's take a look at why the market is fearful of UnitedHealth and many other parts of the healthcare sector right now and review the company's long-term dividend safety and growth prospects. 

April 23rd, 2019|

Abbott: 47 Consecutive Years of Dividend Increases

Founded in 1888, Abbott Laboratories (ABT) is one of the world’s largest medical companies, with a portfolio of leading offerings in diagnostics, medical devices, nutritionals and branded generic pharmaceuticals. Abbott spun off its research-based pharmaceuticals business AbbVie (ABBV) in January 2013 and has four main business units today. Abbott’s revenues are widely diversified across segments, and the company sells more than 10,000 different products. This creates more stable and predictable cash flow compared to standalone drugmakers. 

April 19th, 2019|

Medtronic: A Well-Run Dividend Aristocrat in Healthcare

Medtronic (MDT) is one of the classic American success stories, having been founded in 1949 by Earl Bakken and his brother-in-law, Palmer Hermundslie, in a Minnesota medical equipment repair shop.Over the course of nearly 70 years, the company has grown into one of the world’s largest medical equipment device companies. Today Medtronic's products help treat over 40 medical conditions and 70 million patients around the world each year. The company's medical supplies products are used primarily in hospitals, surgical centers, and alternate care facilities, such as home care and long-term care facilities.Medtronic's business mix changed significantly when the company acquired Covidien for roughly $50 billion in January 2015. The deal expanded Medtronic's presence in faster-growing emerging markets, bolstered the size [...]

April 19th, 2019|

Kraft Heinz Remains a Riskier Dividend Stock as Turnaround Work Continues

Kraft Heinz (KHC) has roots dating back to 1869, but the company was technically formed in 2015 by the $45 billion merger of Heinz and Kraft that was put together by a partnership of Warren Buffett's Berkshire Hathaway (BRK.B) and Brazilian private equity firm 3G Capital. This created the fifth largest food maker in the world and the third largest in the U.S. with more than $25 billion in revenue.Today Kraft Heinz sells products in over 190 countries under numerous household brand names such as Heinz, Kraft, Oscar Mayer, Philadelphia, Velveeta, Lunchables, Planters, Maxwell House, Capri Sun, Ore-Ida, Kool-Aid, and Jell-O. 

April 19th, 2019|

T. Rowe Price: A Quality Dividend Aristocrat Facing Growth Uncertainties

Founded in 1937, T. Rowe Price (TROW) is one of the world’s largest investment managers. The company uses fundamental and quantitative analysis to create and manage a wide variety of equity and bond funds, which have historically beaten their indexes and thus attracted consistent inflows of investor capital. The company makes most of its money through investment advisory fees (90% of net revenue) charged for managing clients' portfolios. Fees are generally assessed as a percentage of assets under management, so they are driven by the total value and mix of the funds T. Rowe Price manages for investors. T. Rowe Price had $962 billion in assets under management at the end of 2018, with roughly two-thirds of its assets in retirement accounts. [...]

April 19th, 2019|

ADP: One of the Fastest-Growing Dividend Aristocrats

Automatic Data Processing (ADP) was founded in 1949 and is one of the largest providers of human capital management (HCM) solutions in the world. ADP offers a wide range of cloud-based software solutions and services, which companies use to pay, recruit, staff, manage, and retain employees.Over 40 million people around the globe depend on ADP for accurate pay, reliable benefits administration, effective performance management, or other human resource services.The company generates most of its revenue on a recurring basis from providing payroll services (handles the preparation of employee paychecks, pay statements, journals, and summaries), including paying 1 out of every 6 workers in the U.S., but has expanded its suite of products over the last decade to cover most of [...]

April 19th, 2019|