Time to continue my quest of finding 2-4 reliable, stable, long-term, dividend paying stocks on LOYAL3 that I can periodically invest in over time. This round of cuts will not be based on numbers, performance, or any quantitative criteria. This time I’m going off of my gut feeling and following some of Warren Buffett’s advice. I heard Buffet say in an interview that in order for him to invest in a company it has to be understandable to him. There are two companies here that I know of but other than that I don’t feel comfortable selecting them as long-term investments. That said, I’m taking LB and AEO off the list. I might throw a little money into LB because it has impressive numbers but other than that I don’t intend to make continued, periodic buys of LB stock.
The stocks still on my LOYAL3 list are: MAT, UL, HAS, MCD, TGT, and KO. Not a bad lineup.
Previously I listed 13 stocks at LOYAL3 with 3% yields or higher. It is time to whittle down this list further. Because I’m currently looking for frequent dividend payments that I can reinvest, I’m removing from the list any stock that doesn’t pay dividends at least quarterly. That scratches BUD and NOK off of my list. That takes me down to 11 stocks. I’d still like to narrow it down to 2-4 stocks that I can invest in with small, monthly purchases. So let’s continue.
My next somewhat arbitrary criteria is to look at the stocks’ overall growth for at least the last decade. If any stock has a negative growth it is coming off of the list. I’ll go to the easy-to-use Google stock price chart to check this out. After some quick stock symbol searching, I’m able to scratch more stocks that either have a negative return over 10 years or 36 years (as far back as Google’s stock charts seem to go). Also, if the stock is less than 10 years old it is coming off my list. So here are the next stocks to be removed:
– FTR (less than 10 yrs old; this is fine because I know nothing about this company)
– WWE (negative 10 yr return; this is fine also because my gut feeling is to not invest in WWE)
– INTC (negative 10 yr return; too bad because I somewhat wanted this stock to be around after my little exercise here)
So, I now have 8 stocks left to research: LB, AEO, UL, HAS, MCD, TGT, KO and one wildcard with MAT. Google doesn’t show a 10-yr history for MAT but from what I can tell from other research this stock has been around for awhile so I won’t scratch it off just yet.