Monday, February 23, 2015

Selling Walmart, and a Few Additions

After a long weekend of consideration, I've decided to sell my position in WMT today.  I closed the position with a gain of around 13.5%, over 2.5 years...pretty anemic.  The final straw was their measly $0.01 dividend raise announced last week, coupled with the announcement they are going to pay their employees more money.  I don't mind the increase in wage, but they said it would cost $1B!!  Ouch.   For Costco, who sells higher end products with high margins, they can pay their employees better, but at the worlds's low cost seller, they can't.  Low yield, slow to no growth, no growth in the dividend...I'm better off owning other names, including utilities....

More on the adds soon, started a 1/3 position in GE (3.6%Y), added to DOV(2.1%Y) and SO(4.6%Y).  And I still have some cash left over.

Here are the FASTGraphs:

First GE:

A few comments on GE:
  • I've owned it in my taxable account for over a year...its pulled back some recently, and presents a good value at current prices
  • GE has a yield of 3.7%, and has been on the rise every year since the financial crisis
  • GE is rated AA+ by S&P, and has sold off their financial business making them less risky
  • GE is huge, global, and into so many markets and countries....a great conglomerate for the long haul.
Next is current holding DOV:

A few Dover comments:
  • Dividend Aristocrat, with raises in the dividend for 59 consecutive years!
  • Price has pulled back some recently due to a rare sales and eps reduction in 2014
  • Slightly underweight position in the portfolio, decided to add a small amount here
Next is utility SO:

A few SO comments:
  • I've held Southern in the chump IRA for 2 years or so, very low Beta of 0.16
  • Yield is 4.6%, and on a Price/Cash Flow basis, the stock is a bit under valued
  • Nice safe utility, with good yield and steady slow growth
  • Added a small additional amount to increase the the portfolio income


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