Some long term plays: November 20th, 2008
November 20, 2008 – 7:06 pmIn my long term below book value article I wrote a few weeks back, I posted some select companies that were infact trading below book value, duh! Well, with this precipitous decline since the writing of that article, these share prices have fallen more and more below book. A few of these are entering the “What the hell is it doing at this price” range along with some that are not below book but are also in the “What the hell is it doing at this price range”:
IMPORTANT: Do keep in mind folks that the dividend rates of some of our beloved blue chips are getting so inflated that you almost have to put money into them. Look at AT&T for instance trading at $24.51 with a 6.53% dividend rate. That is essentially like saying you receive a 6% discount below the cost of what you bought it at if you did in fact buy it at $24.51 if you held the stock for a year an collected four dividend payments. Think of this as an insurance policy.
EVEN MORE IMPORTANT: If there is one thing you guys can take away from this site, I strongly….STRONGLY urge you to buy a high yielding drybulk shipper and initiate a dividend reinvestment program. Think long term folks. Do you have any idea how many shares you would receive a year?
1)Freeport Mcmoran (FCX)
2)U.S Steel (X)
3)Transocean (RIG)
4)Drybulk Shippers
5)Verizon (VZ)
6)General Electric (GE) 9.66% DIVIDEND YIELD?!?!?!
7)Altria (MO) 8.66% Dividend Yield
8)Royal Dutch Shell (RDS.A) 7.56% Dividend Yield. I only use Shell gas!
I am telling you folks. This type of market is what creates average citizens into millionaires in a relatively short period of time and by short I do not mean three years.