One of the challenges of managing your own individual stock portfolio is that you always have to be on guard. Ongoing research and review is necessary to keep abreast of developments that may relatively quickly render a stock undesirable. #-ad_banner-#This reminds me of one former superstar in particular, a stock I’m sure many investors became complacent about because it did so well for so long. Indeed, from the end of February 2009 to mid-May 2011, the price nearly quintupled from about $18 to just over $85. But since then, shares have taken an ugly dive, slumping more than… Read More

One of the challenges of managing your own individual stock portfolio is that you always have to be on guard. Ongoing research and review is necessary to keep abreast of developments that may relatively quickly render a stock undesirable. #-ad_banner-#This reminds me of one former superstar in particular, a stock I’m sure many investors became complacent about because it did so well for so long. Indeed, from the end of February 2009 to mid-May 2011, the price nearly quintupled from about $18 to just over $85. But since then, shares have taken an ugly dive, slumping more than 70% to the current price of about $22 a share. To this stock’s credit, the plunge wasn’t straight down. During the past several years, shares have staged multiple comebacks because the underlying company is well-known and still has many loyal customers. The latest rally occurred May 1, when the stock spiked about 20% after management reported quarterly sales and earnings that weren’t as bad as analysts expected. I’m referring to Weight Watchers International (NYSE: WTW), long a leading global provider of weight-management services through an extensive network of company-owned and franchise operations. My colleague Dave Goodboy was bullish… Read More

Frequently, the best road to success for a company is to do one thing really well — preferably something nobody else does but that’s in great demand all the same. #-ad_banner-#This is exactly the approach of one unique energy firm, which refers to itself simply as “the reservoir optimization company.” Its sole job in life is to provide the research, technology and special expertise necessary to optimize extraction from oil and gas reservoirs. This laser focus has certainly led to great success both for the company and its shareholders. Since 2004, the company’s earnings per share (EPS) have risen an… Read More

Frequently, the best road to success for a company is to do one thing really well — preferably something nobody else does but that’s in great demand all the same. #-ad_banner-#This is exactly the approach of one unique energy firm, which refers to itself simply as “the reservoir optimization company.” Its sole job in life is to provide the research, technology and special expertise necessary to optimize extraction from oil and gas reservoirs. This laser focus has certainly led to great success both for the company and its shareholders. Since 2004, the company’s earnings per share (EPS) have risen an astounding 2,364%, from $0.22 to $5.41. During the past 10 years, its stock has delivered total returns averaging nearly 33% a year. I see Core Laboratories (NYSE: CLB) as a safer way to play the energy sector because it’s not an oil and gas producer. Producers, even the largest ones, can be highly risky because their profits and stocks often fluctuate wildly in response to any number of things such as energy prices, the economy, or unexpected delays, costs or disasters. Core shields itself from these sorts of risks primarily by maintaining a diverse, global customer base of dozens of… Read More

People retiring now or in the near future have my sympathy. It’s a tough time to be retired. #-ad_banner-#Few people have a pension anymore, and Social Security doesn’t provide anywhere near the purchasing power it used to. So, as never before, the onus for financial security in retirement is on the individual. Clearly, retirees need all the help they can get in generating sufficient income, which is why I always keep an eye out for the best income-producing investments available. And I’ve got one that’s perfect for the equity portion of their portfolios. One thing that makes this… Read More

People retiring now or in the near future have my sympathy. It’s a tough time to be retired. #-ad_banner-#Few people have a pension anymore, and Social Security doesn’t provide anywhere near the purchasing power it used to. So, as never before, the onus for financial security in retirement is on the individual. Clearly, retirees need all the help they can get in generating sufficient income, which is why I always keep an eye out for the best income-producing investments available. And I’ve got one that’s perfect for the equity portion of their portfolios. One thing that makes this stock so right for retirees is its safety factor. Typically, it’s 76% less volatile than the market. So if the market corrects by 10%, this stock might only fall 2% or so. In general, to get a sense of a stock’s safety, I like to see how it did in 2008, a terrible year in which the broader market took a nasty 37% tumble thanks to the financial crisis. However, my ideal retirement stock was up 9.5% that year. With dividends, it posted a total return of 12.2%. I’m referring to General Mills (NYSE: GIS), a well-known global leader in… Read More

Rarely a day goes without someone in the financial media claiming there’s a stock bubble about to burst and set off an even worse crisis than the last one.  #-ad_banner-#Now, I wouldn’t be a bit surprised to see a harsh pullback in the short term, but I don’t get the sense a major crash is at hand. And I think all the bubble talk is way overgeneralized. While the market as a whole may be pretty pricey right now, there are still plenty of attractive values out there. But because of the long-running bull market, they’re just a… Read More

Rarely a day goes without someone in the financial media claiming there’s a stock bubble about to burst and set off an even worse crisis than the last one.  #-ad_banner-#Now, I wouldn’t be a bit surprised to see a harsh pullback in the short term, but I don’t get the sense a major crash is at hand. And I think all the bubble talk is way overgeneralized. While the market as a whole may be pretty pricey right now, there are still plenty of attractive values out there. But because of the long-running bull market, they’re just a little harder to find. But I think I’ve found one. I doubt most investors would recognize the name of this company even though it can trace its roots back nine decades. But I bet they’d know its products — raw and processed nuts of all sorts from peanuts, cashews and pecans to walnuts, macadamias and almonds. The firm sells other food products, too, like trail mixes, salad toppings, dried fruit and peanut butter. It has some top brands, including Fisher and Orchard Valley Harvest. The company, John B. Sanfilippo & Son (Nasdaq: JBSS), is one of the largest publicly traded… Read More

To consistently earn the highest returns, financial advisors often recommend using a low-cost fund that tracks the S&P 500 since there’s only perhaps a 30% chance of beating the index over time with actively managed investments.  #-ad_banner-#That’s all well and good if you’re a growth investor, but what if your goal is to maximize your dividend yield without taking any undue risk? In that case, tracking the market definitely isn’t the way to go. One of the most popular funds that does this, SPDR S&P 500 (NYSE: SPY), yields a meager 1.9%. And it comes with all the… Read More

To consistently earn the highest returns, financial advisors often recommend using a low-cost fund that tracks the S&P 500 since there’s only perhaps a 30% chance of beating the index over time with actively managed investments.  #-ad_banner-#That’s all well and good if you’re a growth investor, but what if your goal is to maximize your dividend yield without taking any undue risk? In that case, tracking the market definitely isn’t the way to go. One of the most popular funds that does this, SPDR S&P 500 (NYSE: SPY), yields a meager 1.9%. And it comes with all the stomach-churning volatility you typically see in the broader stock market. That’s why income investors so often turn to sectors known for generous dividends — like telecommunications. Stocks in this sector often boast yields well north of 3%, and many are far less volatile than the market. The big question is which are the best ones to own? My answer: Why not own them all through an ETF? That way, you’ll be well-diversified across the sector but still able to enjoy attractive yields. In my opinion, the #1 choice for the job is Vanguard Telecom Services ETF (NYSE: VOX). The $673… Read More

The old saying “You get what you pay for” doesn’t necessarily hold true for mutual funds. #-ad_banner-#Lots of funds that won’t let you in for less than $25,000 or $50,000 lag behind the market and their peers. Conversely, many of those with initial investment minimums of $1,000 or less put up long-term numbers most fund managers would envy. It’s pretty ironic, but I’m glad that’s the way it is. It’s hard enough getting a jump on building wealth without having to come up with a huge wad of cash just to get started. So why should great growth… Read More

The old saying “You get what you pay for” doesn’t necessarily hold true for mutual funds. #-ad_banner-#Lots of funds that won’t let you in for less than $25,000 or $50,000 lag behind the market and their peers. Conversely, many of those with initial investment minimums of $1,000 or less put up long-term numbers most fund managers would envy. It’s pretty ironic, but I’m glad that’s the way it is. It’s hard enough getting a jump on building wealth without having to come up with a huge wad of cash just to get started. So why should great growth funds be exclusive to those with a lot of money to invest?  Well, they shouldn’t. And fortunately, investors can get into one of the world’s best growth funds for a mere $500. After that, you can add as little as $100 at a time. As the following table shows, the fund has beaten the market and its peers by substantial margins in the short- and long-term. And it has often been noticeably less risky than the broader market, as indicated by its beta of 1.0 over the past year.  As the benchmark, the market itself has a beta of 1.0. Read More

Because no one can predict the future with 100% accuracy, spotting tomorrow’s best income-producing blue-chip stocks today is extremely difficult.  #-ad_banner-#However, I recently profiled one company I strongly believe is well on its way to achieving blue-chip status — filtration technologies manufacturer Pall Corp. (NYSE: PLL) — and there are several others I think have the same type of potential. Aside from being in retail, these three companies aren’t much alike. One is a sodium bicarbonate maker best known for the Arm & Hammer brand, and the second is a leading discount clothing chain based in California. The third has… Read More

Because no one can predict the future with 100% accuracy, spotting tomorrow’s best income-producing blue-chip stocks today is extremely difficult.  #-ad_banner-#However, I recently profiled one company I strongly believe is well on its way to achieving blue-chip status — filtration technologies manufacturer Pall Corp. (NYSE: PLL) — and there are several others I think have the same type of potential. Aside from being in retail, these three companies aren’t much alike. One is a sodium bicarbonate maker best known for the Arm & Hammer brand, and the second is a leading discount clothing chain based in California. The third has carved out a profitable niche as a provider of farm and ranch supplies in rural areas. One thing they do have in common, though: Their dividends have been growing really fast — more than 50% a year, in one case — for some time now. And that’s just one of the main reasons I think that all three companies, like Pall Corp., are on track to take their place among the world’s best dividend-paying blue-chip stocks. These three stocks also display other key characteristics of up-and-coming blue chips such as strong balance sheets, sustainable payout ratios, ample cash flows, and… Read More

Some of the best investments are right in front of us every day. Yet they’re often overlooked because they’re so much a part of our daily lives they don’t register with the conscious mind. #-ad_banner-#One area investors may underappreciate is infrastructure — things like telephone poles, towers for wireless communication, substations for electric utilities, and guard rails along roadways, to name just a few. Although infrastructure is the very foundation of society, I suspect it’s probably far from the first thing on investors’ minds.  However, I expect it to be an excellent investment in coming years. In the… Read More

Some of the best investments are right in front of us every day. Yet they’re often overlooked because they’re so much a part of our daily lives they don’t register with the conscious mind. #-ad_banner-#One area investors may underappreciate is infrastructure — things like telephone poles, towers for wireless communication, substations for electric utilities, and guard rails along roadways, to name just a few. Although infrastructure is the very foundation of society, I suspect it’s probably far from the first thing on investors’ minds.  However, I expect it to be an excellent investment in coming years. In the U.S. and other developed countries, infrastructure has been neglected for so long it now needs some heavy-duty overhaul. Many areas of the emerging world have little or no infrastructure at all and will need tremendous amounts put into place for the first time.   According to the McKinsey Global Institute, as much as $67 trillion in spending on infrastructure of all types will be needed worldwide between now and 2030. Roads and power grids will be in greatest demand, followed by water utilities and telecommunication networks, the Institute says. In the U.S., an estimated $2.2 trillion of infrastructure… Read More

Like people, companies sometimes fail to adequately manage their finances for so long that something eventually has to give. And that’s just what I think is happening with one well-known company with a reputation for safety, reliability and far-above-average dividend yields. #-ad_banner-#Right now, the firm’s payout is $3.50 a share, which is good for an 8.2% yield based on a recent stock price of around $42.50. The stock’s yield has averaged 7.5% annually for a decade. I wouldn’t rush to invest just yet, though, because I strongly suspect this dividend party can’t last much longer. Investors who buy… Read More

Like people, companies sometimes fail to adequately manage their finances for so long that something eventually has to give. And that’s just what I think is happening with one well-known company with a reputation for safety, reliability and far-above-average dividend yields. #-ad_banner-#Right now, the firm’s payout is $3.50 a share, which is good for an 8.2% yield based on a recent stock price of around $42.50. The stock’s yield has averaged 7.5% annually for a decade. I wouldn’t rush to invest just yet, though, because I strongly suspect this dividend party can’t last much longer. Investors who buy now thinking they’ll get yields north of 8% might soon be in for a nasty shock in the form of a major dividend cut. I’m referring to Suburban Propane Partners (NYSE: SPH), a leading national fuel distributor with 1.2 million residential, commercial, industrial, and agricultural customers and annual revenue of $1.7 billion. Propane is the firm’s main business, accounting for about 70% of revenue. However, fuel oil, natural gas, and electricity also generate substantial sales, as do the installation and servicing of heating, ventilation, and air conditioning systems. In January, analysts at Goldman Sachs actually downgraded Suburban to from “neutral”… Read More

Although buy-and-hold stock investing has often been harshly criticized since the financial crisis, the backlash has been way overdone.  #-ad_banner-#I firmly believe this time-honored strategy still has plenty of merit — and the long-term record of one mutual fund that’s a perfect example of buy-and-hold conclusively proves this. Take one look at its turnover ratio, and you’ll know why I say this fund is a perfect example of buy-and-hold. The ratio is zero, meaning the fund never sells — ever. If that’s not buy-and-hold, then I don’t know what is. As the following table shows, the fund has… Read More

Although buy-and-hold stock investing has often been harshly criticized since the financial crisis, the backlash has been way overdone.  #-ad_banner-#I firmly believe this time-honored strategy still has plenty of merit — and the long-term record of one mutual fund that’s a perfect example of buy-and-hold conclusively proves this. Take one look at its turnover ratio, and you’ll know why I say this fund is a perfect example of buy-and-hold. The ratio is zero, meaning the fund never sells — ever. If that’s not buy-and-hold, then I don’t know what is. As the following table shows, the fund has more than kept pace with the market and nicely outperformed its peer group (the large value category) in the intermediate term. It has handily beaten the market and its peers in the long term. The fund’s 10-year record places it in the top 1% of the large value category, and its 15-year record is good for the top 10%. Annualized Rate of Return I’m talking about ING Corporate Leaders Trust (Nasdaq: LEXCX), a $1.6 billion fund that most investors probably haven’t heard of. But anyone who considers themselves buy-and-hold investors will want to be familiar with it. Read More