Dividend Tree Potpourri – August 30, 2009

During the week I participated in blog carnivals and continue to read articles from fellow bloggers. I am listing some of the articles that I enjoyed reading.

Economy, Finance, Investing.…..

My Article in Blogosphere


These are some diverse set of articles from fellow bloggers and business magazines. I hope you enjoy reading all or some of these interesting posts.

Investing for Capital Appreciation or Dividend Income?

investingI am very sure that every dividend investors would have received this question. While dividend investors can ignore responding to folks with trading philosophy, sometimes it does become difficult to argue with value investors. Value investors who in general are looking to invest below book value sometime have an argument that focusing on dividend is not that critical. Business should be applauded for reinvesting profits back into business to grow. In essence, either create additional value or continuously increase value for their shareholder. That is a good argument. However, the key here is “creating value for the shareholders”.

Each individual will look at this differently. For me, “creating value for shareholder” is how much I am getting back in return. In simplistic terms, what is in there for me? From purely business standpoint, typically, value creation means increasing value of its business (and hence increasing stock value). Managements use combination of funding sources (debt, equity, leverage, etc.) to continuously increase the value of its business.

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Low Yield Dividend Stocks – What does it mean?

yieldIn last few weeks, I have looked at dividend stocks (aristocrats and achievers) that have dividend yields of less than 2%. There is a school of thought among dividend crowd that low dividend yields will take more than 10, 12, or even 15 years to match income from high yielding CDs or money market accounts. Furthermore, when low yield dividend stocks are compared to high yield dividend stocks, considering conservative dividend growth rates, low yielding stocks will often lag by significant amount. I agree that, mathematically, there is no argument for low yielding dividend stock providing lower income. Purely based on numbers, it is always good to go for relatively higher yield dividends stocks. In general, the cut off used by dividends investors vary such as 2% absolute dividend yield, 3% absolute dividend yield, or dividend yield higher than market (i.e. S&P500 yield).

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Dividend Tree Potpourri – August 22, 2009

During the week I participated in blog carnivals and continue to read articles from fellow bloggers. I am listing some of the articles that I enjoyed reading.

Economy, Finance, Investing.…..

My Article in Blogosphere


These are some diverse set of articles from fellow bloggers and business magazines. I hope you enjoy reading all or some of these interesting posts.

Analog Devices: Stock Analysis for Dividend Growth Protfolio

analog_devices_logoAnalog Devices, Inc. engages in the design, manufacture, and marketing of analog, mixed-signal, and digital signal processing integrated circuits used in industrial, communication, computer, and consumer applications. Its products are used in communications applications that include wireless handsets and wireless base stations, as well as products used for high-speed access to the Internet, including central office networking equipment.

ADI is not a dividend achiever and has started paying dividends since last 5 years only. The most recent dividend increase was in May 2008. I am impressed by ADI’s strong balance sheet and free cash flow. My objective here is to analyze if ADI has any potential to be a good dividend growth stock and how does it rate on my scale of risk-to-dividends.

continue reading rest of the article….

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