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re: Dividend stocks and DRIPs as a long term investment vehicle

Posted on 6/23/13 at 12:37 pm to
Posted by ThaBigFella
baton rouge
Member since Apr 2006
2043 posts
Posted on 6/23/13 at 12:37 pm to
quote:

1.KO - Coke - 2.86%
2.PM - Phillip Morris - 3.92%
3.MO - Altria - 5.13%
4.CVX - Chevron - 3.39%
5. KMI - Kinder Morgan - 4.19%


I mean listen, there's a million more dividend stocks out there that are going to grow faster bc they're smaller, those ones you listed minus Kinder Morgan are all over $70B companies.

They aren't going to grow as quickly as a small cap.It's all about what you want. I have a big portfolio so to me collecting 3-4%/year in dividends is incredible and I seek a growth in income which those provide in the form of new shares which pay me more. If you are seeking a home run, these are not companies that will double or triple anytime soon.

If I was under 25 and had 30-40 years till retirement and had to buy 5 I would buy in this order

1.Visa
2.Phillip Morris
3.Chevron
4.Altria
5.McDonalds or Coke, I chose MCD bc yield is little higher

I listed them in terms of how they would grow, to me visa is the slam dunk of the next 20,30,40 years but I'm nearing the age where I want to retire and live off dividends and visa' s dividend is so small in dollar terms, but it has tripled from .11/quarter to .33/quarter in the last 2 years which is insanity. Who knows though, if marijuana becomes legal, Altria might become a home run too if we're selling weed in every gas station in america in 10 years.

Those 5 are solid,I know altria and PM are staples of the operating budget of governments all over the world, I know we're moving to a cashless society and visa is the leader, I know we will need oil and chevron or exxon are great(chevron yield is higher), and I know fast food and soda aren't going anywhere and actually growing rapidly all over the world outside of america.

KMI I like too, but they're very interest rate sensitive, and a rise in rates will hurt their expansion, I read a 1% uptick will cost them $55M/year more. It looks like higher rates are near....

as for the companies they recommend, some I know JNJ is nice, its a little overvalued today, but its a great company, the rest I really don't know too much about, doesn't mean their bad, I just stick to what I know. As long as you do your research, read their balance sheets, and feel they have a bright future you will be fine.
This post was edited on 6/23/13 at 12:43 pm
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