New in Simply Safe Dividends: A Much Simpler Stock Screener
A little over a month ago I joined Simply Safe Dividends as CTO (the “tech guy”). After speaking with dozens of customers by phone, trading hundreds of emails with customers, and going through a crash course in analyzing dividend stocks, I’ve set out to make a bevy of improvements to the website. First up was the Stock Screener. This baby was a behemoth with over 40 financial metrics and dozens of data points in the results table. It was powerful but frankly unusable by most people. So Brian and I designed a new Basic Stock Screener that would yield useful results right away with little to no configuration. I’ve already used the new Screener myself and discovered a great company (Southern [...]
Equity Indexed Annuities Pros and Cons for a Safe Retirement
One of the biggest challenges faced by retirees, or people who have just entered retirement, is finding the best method for ensuring that the money they've worked so hard to save doesn’t run out, or isn't lost to market declines. The closer you are to retiring, the less time you have to work and earn additional money to invest and grow your retirement nest egg. Therefore, it's essential to understand the different options available to both maximize your retirement savings and shield that money from loss. One such option that has grown significantly in popularity over the past decade is an insurance product called an equity indexed annuity. In some circles, it's referred to as a fixed [...]
ONEOK Inc (OKE) Is Buying ONEOK Partners (OKS): Is the Deal Good for Dividend Investors?
Master Limited Partnerships (MLPs) such as ONEOK Partners (OKS) have long been a favorite among high-yield income investors. MLPs have appeal thanks to their generally steady cash flows (courtesy of long-term, fixed fee contracts) and business model that involves paying out the majority of distributable cash flow (MLP equivalent of free cash flow) to yield-hungry unit holders. However, thanks to the worst oil crash in over 50 years, many MLPs have disappointed investors by proving to be less safe than initially thought. In fact, many pipeline operators, such as Kinder Morgan (KMI), fell victim to liquidity traps and dangerous debt levels that resulted in large payout cuts. While our Dividend Safety Scores caught these dividend cuts [...]
Target (TGT) Tumbles 12%: What Dividend Investors Need to Know
What Happened? Target (TGT) reported disappointing fourth quarter earnings results this morning, sending the stock down more than 12%. Target's dividend yield now exceeds 4%, well above its five-year average yield of 2.6% and making it one of the highest-yielding dividend aristocrats. Comparable sales declined 1.5% during the quarter, which was at the low end of management's previous guidance. Adjusted earnings per share fell by 4.6% compared to the prior-year quarter, driven by increased promotional activity and changing consumer preferences. While Target's quarterly results were disappointing, management's 2017 guidance is what caused the stock to drop by more than 10%. Target expects a low-single digit decline in comparable sales and forecasts adjusted earnings per share to [...]
Kimberly-Clark (KMB): A Quality Dividend Aristocrat for Long-term Income and Growth
Kimberly-Clark has provided investors with reliable income increases for decades. In fact, the company is one of the 51 dividend aristocrats, which can all be seen here. Kimberly-Clark pays one of the safest dividends in the market, yields close to 3%, offers mid-single digit payout growth, and sells recession-resistant products. All of these investment qualities are appealing for retired investors living on dividends. However, like many other large consumer brand multinationals, Kimberly-Clark is battling foreign currency headwinds, slower growth in developed markets, and an evolving competitive landscape. Let’s take a closer look at Kimberly-Clark to see why it deserves to be a core position in our Top 20 Dividend Stocks portfolio. Business Overview Kimberly-Clark has [...]
Joining Brian at Simply Safe Dividends
Hey there, I'm Matt, Brian's new CTO at Simply Safe Dividends, and here's the story of how I arrived here... I remember the first time I traded a stock. It was Google in 2008. My thinking was simple: buy low and sell high! I had no clue what I was doing. Over the course of a few months, I bought and sold Google based solely on whether the price had gone up or down. Here’s my complete trading history for Google between October 2008 and May 2009: Let me do the math for you: I lost $55 after trading fees. To be honest, I probably didn’t even realize I lost money back then. I just traded [...]
Hormel (HRL) Lowers Outlook, Stock Drops 7%: What You Need to Know
Hormel (HRL) released new quarterly earnings results and updated its 2017 guidance this morning. The company's earnings grew for the 15th consecutive quarter to reach a new record, and adjusted sales and volume increased by 3% and 5%, respectively. Not bad! However, management lowered the company's 2017 earnings per share guidance to $1.65 to $1.71. Hormel previously expected full-year earnings of $1.68 to $1.74 a share, so the company's updated guidance represents a 1.8% decrease at the midpoint. Why the change? Turkey prices declined faster than expected, falling more than 60% from last year to hit a seven-year low. The slump in turkey prices depressed profits in Hormel's Jennie-O Turkey Store segment, which accounted for 24% of the [...]
Special Dividend Definition, Rules, and Impact on Stock Price
There are numerous reasons to embrace dividend growth investing as the best means to achieving long-term financial independence. Most discussion focuses on traditional income stocks, those that pay out steadily growing quarterly dividends. However, occasionally a company will issue a special dividend, which is generally much larger than a regular dividend and therefore tempting for yield-chasers. As you might suspect, special dividends don’t necessarily benefit investors nearly as much as regular dividends. Let’s take a closer look at what a special dividend is, how special dividends impact a stock’s price, taxes on special dividends, and everything in between that you need to know. What are Special Dividends and Why Do Some Companies Pay Them? Generally, [...]
Guide to Taxes on Dividends
With tax season upon us and the world of dividend investing having now matured and expanded into an ever more complex universe of business types, many income investors are understandably confused about taxes on dividends. Especially since the U.S. tax code has grown into one of the largest and most convoluted parts of our government. In fact, the number of pages in the federal tax code expanded from 400 in 1913 to 74,608 in 2014, according to Wolters Kluwer. Let’s take a detailed look at all of the most important considerations you need to keep in mind when it comes to the tax effects of the various dividend investing vehicles. In this guide to taxes on [...]
GNC Suspends Dividend: An Important Lesson on Dividend Safety
GNC (GNC) surprised many income investors when management recently announced that the company’s dividend will be suspended. After all, GNC has been in business for more than 80 years, maintains a payout ratio below 40%, generates solid free cash flow, and even increased its dividend every year since it began paying one in 2012 - including an 11% boost just last year. These are some of the qualities we look for when evaluating companies for our Conservative Retirees dividend portfolio. None of these strengths mattered, however. GNC’s double-digit yield was wiped out immediately, adding insult to injury after the stock’s 70%+ decline over the past year. Dividend safety and capital preservation are two keys for [...]