Investing in large companies with diversified revenue streams is a strategy that can let you sleep soundly at night. Most firms in the Dow Jones Industrial Average, an index of 30 of the largest and most dominant firms in the world, use size to their advantage. Read More
Results
Just a little more than a decade ago, most investors wouldn’t put a dime in this emerging country, even if they were using someone else’s money. But plenty can change in a short amount of time, and today the story is vastly different. Now… Read More
One of the curious aspects of the recent rebound in the IPO market is the heavy slate of China-based companies in the mix. It remains pretty hard for U.S.-based companies to line up a deal, but investment bankers have had little trouble if the… Read More
The recent agreement in Washington to resolve the tax impasse has led many economists to re-check their assumptions about the economy in 2011. Their conclusion: the outlook for 2011 just got a little better. Let’s look at the specific economic indicators, and where most think they will be by… Read More
Any shareholder of a company that has been bought out can tell you that takeovers are often lucrative propositions, often delivering quick double-digit gains. But overall, acquisitions have a reputation for destroying shareholder value at the acquiring company. Studies place the failure rate at between 60% and… Read More
There is a whole range of ways to value a company, from its price-to-earnings (P/E) ratio to its Return on Equity (ROE). Yet investors should really be focused on free cash flow (… Read More
The risky part of investors blindly counting on long-standing hot streaks is that when the streaks finally turn cold, the fallout is enormous. On the flipside, the resumption of those winning streaks makes for incredible turnaround stories. There’s no better example… Read More
Like most investors, I’m usually looking for the safest and most attractive income streams. I search for stocks offering the highest yields, most reliable income and best opportunities for dividend growth. But there is a flip side to this bright picture. Some stocks look like safe income plays on the surface, but are really ticking time bombs. These stocks pay out more in dividends than they earn. Eventually, funds run out and they are forced to cut the dividend. For this reason, every income investor should know the warning signs of a… Read More
Like most investors, I’m usually looking for the safest and most attractive income streams. I search for stocks offering the highest yields, most reliable income and best opportunities for dividend growth. But there is a flip side to this bright picture. Some stocks look like safe income plays on the surface, but are really ticking time bombs. These stocks pay out more in dividends than they earn. Eventually, funds run out and they are forced to cut the dividend. For this reason, every income investor should know the warning signs of a stock in danger of a dividend cut. The most obvious sign is a dividend payout at or near 100% of earnings. That means every penny the company makes is supporting the dividend — nothing is left over to re-invest in the business or pay back loans. There are other danger signs to watch out for as well. Earnings power is key. If a company can’t grow earnings, odds are that dividend growth will stall as well. Companies with large amounts of debt are especially risky, since… Read More
Once a quarter, investors take note of a wide range of buying and selling by company insiders. These folks can only buy and sell the stock of their respective company for a fixed period after earnings have been released. With many companies rolling out quarterly results about a month… Read More
It always pays to scroll through stocks that have taken a recent pounding, Most of the time, they’ve deserved to take a hit. But sometimes, investors simply over-react to seemingly bad news. And that creates opportunity. Let’s take a look at four stocks from the Russell 2000,… Read More