CSCO

Cisco Hikes Payout 24%! Realty Income’s Dividend Coverage Solid

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By Kris Rosemann Two resilient dividend payers that reside in the newsletter portfolios, Cisco (CSCO) and Realty Income (O), reported quarterly results February 10. We were mighty pleased. Networking giant Cisco, a ~1.5% weighting in both the Best Ideas Newsletter portfolio and Dividend Growth Newsletter portfolio, is a free-cash-flow generating machine. Concurrent with its fiscal second-quarter release, the company announced a remarkable 24% increase in its quarterly dividend to $0.26 per share (good now for a 4.5% forward yield), a pace of growth roughly on par with its impressive ~27% increase in its free cash flow through the first six months of fiscal year 2016. Cisco also added $15 billion to its buyback program, and management remains committed to returning … Read more

What’s Working in Today’s Market?

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By Brian Nelson, CFA As emerging markets around the world suffer from commodity-price-led economic weakness, capital continues to find a safe-haven in US government bonds (TLT, TBT), but for those equity-oriented funds that mandate a fully-invested status, not something we’re particularly advocates of, assets within US equities have favored “lower-beta” utilities (XLU) and consumer staples (XLP) sectors while cyclically-dependent and credit-levered sectors such as the financials (XLF) and materials (XLB) have suffered thus far in 2016. The industrials (XLI) and energy (XLE) sectors have also encountered higher-than-normal selling pressure in the first few weeks of the New Year, as investors evaluate the global economic landscape and what a prolonged period of low energy prices may mean for the lowest quality … Read more

Cash Is King: Microsoft Leading the Charge!

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It’s sometimes difficult for companies to overcome a tarnished reputation, particularly when it comes to a spotty dividend track record, but also as it relates to equity performance. The stock market is often unforgiving at times. Microsoft (MSFT) had long been viewed as “dead money,” or a term that describes an equity that languishes in a small trading range for years. For example, from 2010 to the beginning of 2013 (at the time it was added to the Dividend Growth Newsletter portfolio), Microsoft had bounced around in the mid-$20s per share. But as the chart below shows, overcoming a tarnished reputation is not impossible; in fact, Microsoft has put its “dead money” reputation behind it, powering past levels even witnessed … Read more

Analysis: The Best Ideas Portfolio

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Please select the image below to download the report.  Note: The High Yield Dividend Newsletter portfolio, Best Ideas Newsletter portfolio and Dividend Growth Newsletter portfolio are not real money portfolios. Results, including those in the Nelson Exclusive publication, are hypothetical and do not represent actual trading. Past performance is not a guarantee of future results, and actual results may differ from simulated information being presented.  The performance of the High Yield Dividend Newsletter portfolio, Nelson Exclusive publication, Best Ideas Newsletter portfolio and Dividend Growth Newsletter portfolio have not been externally audited. The following download of the Best Ideas Newsletter portfolio is an internal assessment. Newsletter performance figures, including those in the Nelson Exclusive publication, are prepared by Valuentum. Hypothetical results are … Read more

Leading Investors to Water…

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“Entrepreneurs are never satisfied. They want to do things better. They strive for perfection and use all the ingenuity to their command to achieve it.” – J.W. Marriott Company Name Symbol YTD % Outperform? Apple AAPL 7.84 Y Alibaba BABA -18.37 N Altria MO 18.75 Y Cisco CSCO -1.2 N eBay EBAY 24.26 Y Financial Select SPDR XLF 1.52 N General Electric GE 20.66 Y Gilead Sciences GILD 10.41 Y Google (now Alphabet) GOOG 46.07 Y Google (now Alphabet) GOOGL 46.84 Y Health Care ETF XLV 6.02 Y Intel INTC -3.73 N SPDR S&P Bank ETF KBE 9.25 Y Republic Services RSG 10.09 Y Rio Tinto RIO -31.07 N Teva Pharma TEVA 16.12 Y Union Pacific UNP -32.46 N Utilities … Read more

Cisco Reports Solid Quarter; Shares Still Cheap With Nice Dividend

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In its first quarter of fiscal 2016, ended October 24, Cisco (CSCO) reported healthy financial performance. The firm grew total revenue 4% to $12.7 billion from the year-ago period, and non-GAAP earnings per share advanced more than 9% to $0.59. Top-line growth was led by emerging markets revenue growth of 11%, driven primarily by Mexico and India. The strong US dollar has impacted performance in countries such as Brazil and Russia to a degree, and we don’t expect this headwind to subside in the near term. Cisco continues to transform its revenue model to a greater recurring mix thanks to a 10% increase in deferred revenue in the fiscal first quarter. Software and subscriptions led the deferred revenue growth, jumping … Read more

Bond Issuance Has Ground to a Halt; Expect Negative 2016 GDP Impact

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The Fed is in a tight spot. We give Ben Bernanke and team a lot of credit for successfully delaying a prolonged global economic recession following the worst financial crisis of our generation late last decade, one that swallowed up such household names as GM (GM) and AIG (AIG), but such policies always come with unintended consequences. New Fed Chair Janet Yellen may have to deal with the true aftermath, and it’s been thrust upon her, perhaps unfairly. With interest rates on fixed-income products near the lowest they’ve been in history, retirees and near-retirees, after suffering significant capital losses during the Financial Crisis, have been lured into higher-yielding dividend-paying equities, the prices of some almost completely supported by debt-infused dividend … Read more

5 High-Yielding Strong Dividend Growth Stocks for the Long Haul

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We’ve never been more concerned about the financial health of dividend growth investors. Perhaps we’re partly to blame for some of the excitement surrounding the strategy that has taken many corners of the web by storm, but we continue to believe it is important for investors to strive to understand the strategy’s fundamental fallacies, which can’t be talked about enough as a means of helping investors understand key risks.   For those new to dividend growth investing, part of the strategy centers on identifying stocks that pay dividends that are poised to increase over the long haul, generating in time a yield (a payout) that is a) sufficient on the cost and b) sufficient to generate an adequate income in retirement … Read more

The Debt Bubble Is Deflating; Will It Pop?

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The fundamental concerns surrounding the financial health of China-dependent companies across the globe are tangible, and the risk of a currency crisis and eventual credit crunch are real, if they aren’t already happening. Fortescue Metals Group (FMG), the fourth-largest iron ore producer in the world, announced over the weekend, that profits were nearly completely wiped out (down nearly 90%) for the fiscal year ending June 30, even as the firm shipped 33% more tons of iron ore during the period over last year’s mark. The largest iron ore producers, BHP Billiton (BHP) and Rio Tinto (RIO), are only adding to production overcapacity, conditions that are wreaking havoc on the commodity price. Iron ore prices are to remain under pressure as … Read more

Cisco Pops; Valuation, Dividend, and Chart Look Great!

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Communications networking giant Cisco (CSCO) is off to the races August 13 after posting a better-than-feared quarterly earnings report for the fiscal fourth period, ending July 25. Cisco has been one of the more recent additions to both the Best Ideas Newsletter portfolio and Dividend Growth Newsletter portfolio, with shares added just above $26 each in late November after registering a 9 on the Valuentum Buying Index. The company is now trading ~$29 per share, and its chart has never looked better, with shares breaking through a multi-month healthy downtrend. To put this idea into perspective, a strong 10% share-price pop since November coupled with a growing dividend stream is quite nice in today’s “flat” market.  Cisco’s shares yield ~3%, and … Read more