Income Investing
Any business can crank out hefty profits when conditions are favorable. The true test is how well it performs when the operating climate cools. As a group, energy stocks underperformed during the bull market. That’s no secret, given the persistent weakness in oil prices. The price of benchmark West Texas Intermediate (WTIC) crude was once above $100 per barrel in 2014. After falling to the low $30s by 2016, prices have since only recovered to the mid-$60s. You can see how this affected stocks in the sector, as represented by the SPDR Energy Select Sector ETF (NYSE: XLE),… Read More
Any business can crank out hefty profits when conditions are favorable. The true test is how well it performs when the operating climate cools. As a group, energy stocks underperformed during the bull market. That’s no secret, given the persistent weakness in oil prices. The price of benchmark West Texas Intermediate (WTIC) crude was once above $100 per barrel in 2014. After falling to the low $30s by 2016, prices have since only recovered to the mid-$60s. You can see how this affected stocks in the sector, as represented by the SPDR Energy Select Sector ETF (NYSE: XLE), on the chart below. This is exactly what makes a company like Phillips 66 (NYSE: PSX) so special. We’re up more than 54% (with dividends reinvested) on the holding over at The Daily Paycheck. That not only blows the sector out of the water, but also the entire market. We just got a glimpse of the kind of operating expertise necessary to pull that kind of performance off – and why I think it’s still a “buy” today. Inside The Numbers The company's core refining margins slipped to $11.18 per barrel… Read More
If you're like most people, then you have probably received a box (or several) on your front door this month courtesy of Amazon Prime's free two-day shipping. Or perhaps it was sent by Wal-Mart or another online retailer. Wherever the source, there are countless packages whizzing from warehouse to doorstep during the Christmas shopping season. It has been estimated that FedEx (NYSE: FDX) made 510 million deliveries between Black Friday and New Year's Eve. The firm's hectic Memphis hub processes 2 million packages per day during the peak holiday season – about 500,000 per hour. Keep in mind,… Read More
If you're like most people, then you have probably received a box (or several) on your front door this month courtesy of Amazon Prime's free two-day shipping. Or perhaps it was sent by Wal-Mart or another online retailer. Wherever the source, there are countless packages whizzing from warehouse to doorstep during the Christmas shopping season. It has been estimated that FedEx (NYSE: FDX) made 510 million deliveries between Black Friday and New Year's Eve. The firm's hectic Memphis hub processes 2 million packages per day during the peak holiday season – about 500,000 per hour. Keep in mind, FedEx and Amazon have a testy relationship at best. Otherwise, that number would be even higher. The e-commerce king does quite a bit of shipping on its own and is becoming a real threat in that regard. Amazon even dictates how the 5 million independent third-party sellers on its website can and can't fulfill their orders. According to Business Insider, Amazon employs 75,000 private courier drivers who will deliver 3.5 billion packages this year. For context, UPS (NYSE: UPS) drops off 5.2 billion parcels annually. UPS estimates it will deliver 32 million packages per day globally this holiday… Read More
I spent some time working in a bank branch as a financial advisor back in the early 2000s. It’s a pretty good gig, if for no other reason than the inordinate number of paid holidays (Columbus Day, Flag Day, Arbor Day). But what really amazes me is that almost 20 years later, the bank hasn’t really changed a bit. This is a timeless business model. —Recommended Link— Shocking Marijuana Discovery Could Turn Every $1,000 Into $61,770 Scientists have stumbled on a technology that could drive every marijuana “grow op” into bankruptcy. Early investors have a… Read More
I spent some time working in a bank branch as a financial advisor back in the early 2000s. It’s a pretty good gig, if for no other reason than the inordinate number of paid holidays (Columbus Day, Flag Day, Arbor Day). But what really amazes me is that almost 20 years later, the bank hasn’t really changed a bit. This is a timeless business model. —Recommended Link— Shocking Marijuana Discovery Could Turn Every $1,000 Into $61,770 Scientists have stumbled on a technology that could drive every marijuana “grow op” into bankruptcy. Early investors have a shot at returns up to 6,077% on the biotech that’s become Wall Street’s “best-kept secret.” A Senate vote within weeks could change the marijuana industry forever. Click here for details. Just think of the number of products and services that have been disrupted or rendered obsolete since then. VCRs. Dot Matrix printers. Fax machines. Floppy disc drives. But banks are just as viable and important today as they were a century ago. More than that, you could argue the financial system is the backbone of the entire economy. After all, borrowing and lending are what grease… Read More
Christmas just came early. That’s because it’s time for my monthly check-in on companies that are likely to announce a dividend hike in the coming month. If you’re new to this, here’s how it works… In each issue of my premium newsletter, High-Yield Investing, I scan the market for noteworthy special dividend hikes on the horizon, as well as for potential dividend hikes over the next four to six weeks. I give special attention to outsized double-digit increases and reliable dividend-payers that have been steadily growing payouts for a decade or more. I flag these stocks first for my premium… Read More
Christmas just came early. That’s because it’s time for my monthly check-in on companies that are likely to announce a dividend hike in the coming month. If you’re new to this, here’s how it works… In each issue of my premium newsletter, High-Yield Investing, I scan the market for noteworthy special dividend hikes on the horizon, as well as for potential dividend hikes over the next four to six weeks. I give special attention to outsized double-digit increases and reliable dividend-payers that have been steadily growing payouts for a decade or more. I flag these stocks first for my premium readers. Then, I share them with the public. It’s that simple. If you’re looking for potential portfolio additions to research further, I can’t think of a better place to start. So without further delay, here’s what I’ve found this month… 1. Coca Cola (NYSE: KO) – Coca-Cola doesn’t really need an introduction, other than a reminder that this global beverage giant is far more than just its namesake soda. Yes, the Coke brand is one of the world’s most valuable, worth an estimated $59 billion. But it’s just one of twenty thoroughbred brands in the stable that each rake in… Read More
The first Federal inheritance tax was passed in 1898. Corporate taxes were written into law in 1909. And in 1913, the Sixteenth Amendment was ratified, paving the way for federal income taxes as we know them today. Ironically, that first attempt at taxing income from wages, property, and investments was the byproduct of a fierce debate on tariffs. Politicians of the day wanted to reduce tariffs and abandon the nation’s protectionist policies. Income taxes were seen as a way to offset lost federal revenues. Over a century later, we are still arguing over these same issues. But whatever transpires on… Read More
The first Federal inheritance tax was passed in 1898. Corporate taxes were written into law in 1909. And in 1913, the Sixteenth Amendment was ratified, paving the way for federal income taxes as we know them today. Ironically, that first attempt at taxing income from wages, property, and investments was the byproduct of a fierce debate on tariffs. Politicians of the day wanted to reduce tariffs and abandon the nation’s protectionist policies. Income taxes were seen as a way to offset lost federal revenues. Over a century later, we are still arguing over these same issues. But whatever transpires on Capitol Hill, one thing is for sure: income taxes are here to stay. —Recommended Link— “Banks want a hit of the marijuana business” — how you could profit (15x potential) If there’s anything we learned from 2008: Big Banks get what they want. But it’s not all bruises & bailouts this time… because their rumbling appetite for a slice of the pot pie — is putting HUGE pressure on a trillion-dollar reservoir of cash… Washington Post reports “banks want a hit of the marijuana business”… Energy & Capital says “Big Banks Want in… Read More
It’s been a downhill slide for AMC Entertainment Holdings (NYSE: AMC) over the past couple months. Fortunately, underlying business trends have been moving in the opposite direction. AMC welcomed 87.1 million visitors to its theatres last quarter – a record. Even more impressive, it managed to push through a 3.3% hike in average ticket prices, while its peers only hiked by 0.65%. The company continues to dramatically outperform the industry average by several hundred basis points in terms of attendance growth and revenue growth per screen. #-ad_banner-#More of those guests lined up at the concession stand for popcorn and beverages… Read More
It’s been a downhill slide for AMC Entertainment Holdings (NYSE: AMC) over the past couple months. Fortunately, underlying business trends have been moving in the opposite direction. AMC welcomed 87.1 million visitors to its theatres last quarter – a record. Even more impressive, it managed to push through a 3.3% hike in average ticket prices, while its peers only hiked by 0.65%. The company continues to dramatically outperform the industry average by several hundred basis points in terms of attendance growth and revenue growth per screen. #-ad_banner-#More of those guests lined up at the concession stand for popcorn and beverages too. Food and drink revenues per patron rose 5% to hit a new third-quarter high. So, what does all this mean for revenue? Well, AMC took in $1.32 billion over the past three months, a healthy increase of 8%. After adjusting for a non-cash accounting change, EBITDA rose 33% from a year ago to reach $157 million. Of course, that figure excludes interest expense, which can’t just be ignored (AMC paid $85 million in interest for the period). But operating cash flow has improved sharply as well, rebounding to $56 million from just $2 million a year ago. I suspect… Read More
Last week, I wrote about the staggering numbers behind global trade. I even mentioned a couple of ways investors could potentially profit. One of those ways is with containership leasing firm Seaspan (NYSE: SSW). A Seaspan assist ship docking with a bulk carrier (above) Seaspan made its market debut in 2005 with ownership of 13 containerships. That fleet size doubled to 25 vessels within two years and doubled again to 50 just three years later. Today, the company owns 112 ships. That makes it the world’s largest independent containership owner, with 15% more capacity than the next-closest competitor. Read More
Last week, I wrote about the staggering numbers behind global trade. I even mentioned a couple of ways investors could potentially profit. One of those ways is with containership leasing firm Seaspan (NYSE: SSW). A Seaspan assist ship docking with a bulk carrier (above) Seaspan made its market debut in 2005 with ownership of 13 containerships. That fleet size doubled to 25 vessels within two years and doubled again to 50 just three years later. Today, the company owns 112 ships. That makes it the world’s largest independent containership owner, with 15% more capacity than the next-closest competitor. These ships span the full spectrum, from small “feeder” vessels to mid-sized liners to ultra-large containerships (ULCS) that can hold up to 14,000 containers. Those containerships aren’t experiencing much downtime these days. Those ships were “on-hire” 99.6% of the time last quarter. That’s the highest utilization rate since 2011. Other than a few days in dry-dock for scheduled maintenance, Seaspan’s ships have essentially been available – and chartered – around the clock. And rates are holding steady. With a growing fleet, charter revenues have increased 5% year-to-date to $843 million. It helps that Seaspan has longstanding relationships with seven of… Read More
The last of the leftover turkey and pumpkin pie are gone, which means the countdown to Christmas has officially begun. And thus far, it has been a smashing success for retailers. While Black Friday has traditionally been considered the kickoff to the holiday season, many retailers are moving the start earlier and earlier. An estimated 40 million Americans jumped the gun and hit the stores on Thanksgiving Day in search of special deals and promotions. While checkout lines weren’t quite as long on Friday (according to RetailNext, foot traffic slipped 2% after rising 2% on Thursday), shoppers still spent freely,… Read More
The last of the leftover turkey and pumpkin pie are gone, which means the countdown to Christmas has officially begun. And thus far, it has been a smashing success for retailers. While Black Friday has traditionally been considered the kickoff to the holiday season, many retailers are moving the start earlier and earlier. An estimated 40 million Americans jumped the gun and hit the stores on Thanksgiving Day in search of special deals and promotions. While checkout lines weren’t quite as long on Friday (according to RetailNext, foot traffic slipped 2% after rising 2% on Thursday), shoppers still spent freely, both online and offline. Adobe Analytics (which monitors real-time spending at 80 of the nation’s top 100 retailers) estimates that online shoppers spent $7.4 billion on Black Friday, up from $6.2 billion last year. By Sunday night, physical and virtual stores had rung up a combined $69 billion in sales over the long four-day weekend. But The Shopping Binge Didn’t End There… Cyber Monday defended its title as the busiest shopping day of the year, with online retailers taking in $9.2 billion in sales. That’s a healthy 17% increase from last year – and a new record high. #-ad_banner-#Research… Read More