US Dividends Aristocrats thread

[Mr. Wood]

Occidental Announces 2nd Quarter 2019 Results
Wednesday, July 31, 2019

sure div analyst:

Occidental Petroleum Beats Q2 Earnings and Revenue Expectations

Yesterday after the markets closed, Occidental Petroleum Corporation (OXY) reported second quarter financial results for the period ending June 30th, 2019. The company beat expectations for both revenue and earnings and also provided an update on its pending acquisition of Anadarko Petroleum Corporation (APC).

First, let’s discuss Occidental Petroleum’s actual financial results. In the quarter, revenues of $4.4 billion increased by 8.3% year-on-year. However, due to Occidental’s dependence on the price of oil, measuring the company’s performance by revenue is arguably not the best method for assessing its performance.

Instead, we prefer to assess the company’s cash flow figures. In the second quarter of fiscal 2019, Occidental Petroleum generated operating cash flow of $2.0 billion, an increase of 14.6% year-on-year, while free cash flow (defined as operating cash flow minus capital expenditures) of $802 million increased by 71.0% year-on-year, due to both higher operating cash flows and lower capital expenditures.

The company’s GAAP results were not quite as strong. On the bottom line, Occidental Petroleum’s GAAP net income declined from $1.6 billion to $1.3 billion while diluted earnings-per-share decreased from $2.02 to $1.68, a decline of 16.8%.

Occidental’s performance was slightly better if nonrecurring accounting charges are excluded. In the second quarter, Occidental Petroleum’s adjusted net income of $1.4 billion decreased by 12.6% while adjusted diluted earnings-per-share decreased by 10.9%.

Occidental Petroleum also provided a brief update into its pending acquisition of Anadarko Petroleum. The company noted that the Anadarko shareholder vote is scheduled for August 8th, with the acquisition expected to close promptly thereafter. Separately, Occidental’s financial statements revealed that it incurred $50 million of Anadarko-related expenses in the second quarter, while “none-core items of $107 million include Anadarko acquisition-related transaction and debt financing fees.”

Overall, it was a solid earnings release from Occidental Petroleum, although we remain skeptical of the value of the Anadarko petroleum acquisition given the expensive financing being provided from Berkshire Hathaway (BRK.A) (BRK.B). You can read our original analysis on the financing here.

Looking ahead, Occidental’s high dividend yield, solid growth prospects, and slightly undervalued stock price are still sufficient for it to earn a buy recommendation from Sure Dividend at current prices.

 

[Mr. Wood]

 

[Mr. Wood]

Qualcomm Announces Third Quarter Fiscal 2019 Results
GAAP Revenues $9.6 billion, Non-GAAP Revenues $4.9 billion
GAAP EPS $1.75, Non-GAAP EPS $0.80
July 31, 2019

 

[Mr. Wood]

ADM Reports Second Quarter Earnings of $0.42 per Share, $0.60 per Share on an Adjusted Basis
08/01/2019

 

[Mr. Wood]

Philip Morris International Names New Chief Product Officer
August 01, 2019

 

[Mr. Wood]

CON EDISON REPORTS 2019 SECOND QUARTER EARNINGS
August 1, 2019

sure div analyst:

Consolidated Edison Meets Expectations, Shares Up 0.9%

Yesterday after the markets closed, Consolidated Edison (ED) reported financial results for the second quarter of fiscal 2019. The company basically met expectations on both the top and bottom lines (technically, it missed earnings estimates by $0.01), causing shares to rise modestly in this morning’s premarket trading.

On the top line, Consolidated Edison generated total operating revenues of $2.7 billion, which represents growth of 1.8% year-on-year. The company’s total operating revenues increased by a slightly better 3.3% year-on-year through the first half of fiscal 2019.

Further down the income statement, Consolidated Edison’s operating income of $458 million increased by 7.5% in the second quarter while operating income increased by 8.4% through the first half of the current fiscal year.

On the bottom line, Consolidated Edison generated adjusted earnings of $189 million or $0.58, which was flat year-on-year for company-wide profits and declined by 4.9% on a per-share basis due to the impact of a higher number of shares outstanding.

Consolidated Edison also reaffirmed its 2019 financial guidance with the publication of its second quarter earnings release. The company continues to expect to generate adjusted earnings-per-share between $4.25 and $4.45 in the twelve-month reporting period.

For context, Consolidated Edison generated $4.43 of earnings-per-share in fiscal 2018, so even if the company achieves the high point of its guidance band, it will barely show any growth in the current fiscal year.

Overall, Consolidated Edison’s second quarter results were not spectacular but they were in-line with our long-term expectations for the company. While Consolidated Edison will never be a high-growth glamor stock, many investors find appeal in its safety and dividend growth. However, the company trades significantly above our fair value estimate today, so Consolidated Edison earns a sell recommendation from Sure Dividend at current prices.

 

[Mr. Wood]

ExxonMobil Earns $3.1 Billion in Second Quarter 2019
AUGUST 2, 2019

sure div analyst:

Exxon Mobil Beats Earnings and Revenue Expectations, Shares Up 2%

This morning before the markets opened, Exxon Mobil (XOM) reported financial results for the second quarter of fiscal 2019. The company beat consensus estimates for both earnings and revenue, causing shares to rise approximately 2% in today’s premarket trading.

Here are what the numbers look like. Revenues of $69.1 billion decreased by 6.0% year-on-year, while year-to-date revenue of $132.7 decreased by 6.4% through the first six months of the year.

Exxon Mobil’s production was stronger than its revenue trends would imply. The company’s oil-equivalent production was 3.9 million barrels per day, which represents an increase of 7% from the same period in 2018.

While the company’s overall dollar-denominated revenues declined in the quarter, Exxon Mobil did have a few operational bright spots in the reporting period.

The company’s upstream liquids production increased by 8% year-on-year, driven by strength from the Permian Basin geography and reduced downtime. Natural gas volumes increased by 5% (excluding entitlement effects and divestments). Separately, Exxon Mobil is preparing to start up its Liza Phase 1 development in Guyana, which is estimated to house recoverable resources of more than 6 billion oil-equivalent barrels. Exxon Mobil’s U.S. Gulf Coast stream cracker plant also exceeded its design capacity by more than 10%, less than a year after the location was started up.

On the bottom line, Exxon Mobil generated earnings of $3.1 billion, which represents a decrease of 21% from the same period last year. Similarly, diluted earnings-per-share of $0.73 also declined by 21% year-on-year.

Bottom line results through the first half of the year were even worse. Exxon Mobil has generated earnings of $5.5 billion through the first six months of fiscal 2019, a decline of 36%. Year-to-date diluted earnings-per-share of $1.28 also declined by 36%.

Overall, Exxon Mobil’s second quarter results were slightly better than the markets expected. The company seems capable of delivering low double-digit returns from its current price, which allows it to earn a buy recommendation from Sure Dividend today.

 

[Mr. Wood]

https://www.berkshirehathaway.com/qtrly/2ndqtr19.pdf
For the quarterly period ended June 30, 2019

Berkshire Hathaway Reports Second Quarter Results

On Saturday, Warren Buffett’s conglomerate Berkshire Hathaway (BRK.A) (BRK.B) reported financial results for the second quarter of fiscal 2019.

On the top line, Berkshire Hathaway generated total revenues of $63.6 billion, which represents an increase of 2.2% over the same period in 2018. Through the first six months of the fiscal year, Berkshire Hathaway’s total revenues have increased by 3.0%.

Berkshire Hathaway’s revenue growth was stratified by operating segment. The company’s revenue performance for selected major segments is shown below:
• Burlington Northern Santa Fe: 0.2% growth

• GEICO: 5.7% growth (based on premiums written, not premiums earned)

• Berkshire Hathaway Reinsurance: 5.2% decline (based on premiums earned, not premiums written)

• Berkshire Hathaway Energy: 1.6% decline

• Manufacturing, Service, and Retailing: 1.2% growth
Recall that Berkshire Hathaway owns a $201 billion portfolio of common equities, and that recent changes to accounting rules mean that fluctuations in this account must now be run through the company’s income statement. Because of this, measuring Berkshire’s performance using its net income is not the best method for assessing its financial results.

We believe the best way to avoid this problem is by assessing the earnings before income taxes of Berkshire Hathaway’s operating businesses, excluding investment and derivative gains. Fortunately, Berkshire Hathaway makes this comparison in one of the notes to its financial statements, which we have included below. As you can see, the red circle indicates that investment gains and losses have added about $32 billion to Berkshire’s GAAP earnings through the first half of the ongoing fiscal year.



In total, Berkshire Hathaway’s pretax earnings declined by $394 million, or 4.8%, to $7.8 billion in the quarter. Note that more than all of this decline came from its insurance segments, which saw pretax earnings decline by $491 million. Over a longer time period – the first six months of 2019 – the company’s pretax earnings increased from $14,759 million to $14,905 million, representing growth of about 1%.

On the surface, this is a poor result, but it is important to measure a complicated entity like Berkshire Hathaway using more than one yardstick. We recommend that investors also consider two other metrics when assessing Berkshire’s results, with the first being free cash flow.

Berkshire Hathaway’s statement of cash flows provided in its second quarter earnings release is for the first six months of the year (and not the second quarter alone), but this still provides helpful insight into the company’s results. Through the first half of the year, Berkshire’s free cash flow of $10.0 billion increased by 2.6% over the same period last year.

The third method that we recommend measuring is book value, which Buffett has long used as a measurement tool for his performance managing Berkshire. At the end of the second quarter of fiscal 2019, Berkshire Hathaway had book value per Class B share of $157.56, which increased by 7.5% over the $146.60 of book value reported in 2018’s equivalent reporting period.

By all metrics, Berkshire’s performance through the first half of this year has been disappointing – at least relative to the company’s impressive long-term track record. After examining the company’s filing with the Securities & Exchange Commission, we believe there are two main reasons for this.

The first is the drop in insurance earnings. While the segment’s poor performance was responsible for all of Berkshire’s decline in pretax earnings, this does not concern us over the long term. The insurance industry is somewhat cyclical by nature, and the important aspect of the business is that it is consistently profitable and continues to generate plenty of insurance float for reinvestment.

The second main contributor to Berkshire’s poor performance in the quarter is the lack of any earnings contribution from Kraft-Heinz (KHC). Berkshire noted in its 10-Q that:

“As of August 3, 2019, Kraft Heinz’s financial statements for the first and second quarters of 2019 were not yet available to Berkshire. Accordingly, Berkshire’s Consolidated Financial Statements for the second quarter and first six months of 2019 exclude its share of the earnings and other comprehensive income of Kraft Heinz for those periods. Berkshire intends to record its share of Kraft Heinz’s earnings and other comprehensive income for the first six months of 2019 during the period that such information becomes available. During the six-month period ending June 30, 2018, we recorded equity method earnings of $467 million. Dividends received from Kraft Heinz were $260 million and $407 million in the first six months of 2019 and 2018, respectively, which we recorded as reductions of our investment.”

Given Kraft-Heinz’s recent difficulties, we believe that the equity method investment’s earnings are likely to come in materially lower than the $467 million recorded in last year’s period. If Kraft-Heinz’s earnings are 20% lower this year – which would mean Berkshire’s share of earnings drops to $374 million – then Berkshire’s year-to-date pretax profits increase to $15,279 million, representing year-on-year growth of 3.5%.

Because of the company’s tremendous free cash flow, Berkshire Hathaway’s cash hoard continues to build. The company’s cash and short-term investments account totaled $122.4 billion at the end of the second quarter, which represents an increase of 9.4% from the $111.9 billion held at year-end 2018.

Many investors thought that this rising cash pile would be used to repurchase shares in the second quarter given Berkshire’s depressed stock price. However, the pace of the company’s repurchases broadly disappointed the markets.


In total, these share repurchases amount to $442 million – which compares very poorly to both Berkshire’s $500 billion market capitalization and its $122 billion cash hoard.

Overall, Berkshire Hathaway’s second quarter results were slightly disappointing – especially with regard to the company’s slower-than-expected pace of share repurchases. The company seems undervalued, has one of the best management teams of any business, and also has one of the most conservative balance sheets in the public universe. Berkshire seems capable of delivering ~10% total returns with very little risk, which allows it to earn a buy recommendation today.

note: BRK does not pay dividends.

 

[Mr. Wood]

August 2019 List of All 45 Monthly Dividend Stocks
updated August 2nd, 2019

 

[Mr. Wood]

August 2019 Dividend Aristocrats List: 25+ Years of Rising Dividends
updated August 2nd, 2019

Performance Through July 2019
In July of 2019, The Dividend Aristocrats, as measured by the Dividend Aristocrats ETF (NOBL), was virtually flat. It slightly underperformed The S&P 500 in the month.

NOBL generated total returns of 0.2% in July of 2019
SPY generated total returns of 06% in July of 2019
Performance between these 2 ETFs for the first 7 months of fiscal 2019 is below:

NOBL has generated total returns of 16.6% through July
SPY generated total returns of 20.1% through July
Short-term performance is mostly noise. Performance should be measured over a minimum of 3 years, and preferably longer periods of time.

The Dividend Aristocrats Index has outperformed the market by 1.4 percentage points annually over the last decade – with slightly lower volatility.

 

[Mr. Wood]

August 2019 Dividend Kings List: 50+ Years of Dividend Growth
updated August 3rd, 2019

Performance Of The Dividend Kings
The Dividend Kings outperformed The S&P 500 ETF (SPY) in July of 2019 on a relative basis. Return data for June 2019 is shown below:

Dividend Kings June 2019 total return: 1.4%
SPY July 2019 total return: 0.6%
Total return performance year-to-date through July 2019 is below:

Dividend Kings: 17.9%
SPY: 20.1%

 

[Perisher]

So how is your port doing?

 

[Immortal]

So how is your port doing?

Did he list his somewhere ?

Realised 30% loss from my ABBV. (Div Aristocrat)

 

[Mr. Wood]

So how is your port doing?

overall up 5% ytd not counting divys
nobl etf is best abt 7% up.
HRL like not moving.
Watching MMM

of course cannot win others stock pick FB, APPL, tsla etc. but hey, i think i am quite comfortable with dis.

 

[Mr. Wood]

Did he list his somewhere ?

Realised 30% loss from my ABBV. (Div Aristocrat)

u sold?

 

[Mr. Wood]

The Sure Dividend Top 10 – August 2019
Name & Ticker | Fair Value
Ameriprise Financial (AMP) | $191
Walgreens (WBA) | $75
Cardinal Health (CAH) | $61
A. O. Smith (AOS) | $48
Foot Locker (FL) | $66
Altria Group (MO) | $63
Hanesbrands (HBI) | $23
WestRock (WRK) | $51
Snap-on (SNA) | $188
CVS Health (CVS) | $76

dyodd

 

[Mr. Wood]

The 8 Best Water Stocks: How To Profit From One Of Life’s Bare Necessities
Published on August 8th, 2019

Olin Corp. (OLN)
Franklin Electric (FELE)
Xylem Inc. (XYL)
Algonquin Power & Utilities (AQN)
The Toro Company (TTC)
Pentair (PNR)
A.O. Smith (AOS)
Consolidated Water Company (CWCO)

dyod

 

[Mr. Wood]

August 2019

 

[Mr. Wood]

 

[Mr. Wood]