I like tobacco stocks and have talked a few times here, especially the dominating company, Altria (MO). As I said, I hate smoking as a physician but I love such stocks as investment since they can bring me very reliable income for my retirement. One tobacco stock I’m holding is Phillips Morris (PM) which has done great for me since I got it. To be clear, I did not buy PM myself but got it for free from MO since it was spun off from MO in 2008. When I got it, it was around $50 and has since then appreciated to $80-90 in the past 6 years. Similar to its parent company MO that has paid increasing dividends for half a century, PM has done exactly the same thing to reward investors with increasing dividends with an annual dividend growth rate of 12%. So the dividend I’m getting now has been increased from the initial .45 per share to $1.0 per share. You can count that it will continue to hike the dividends for long long time!
As I said, I was busy buying in the past couple of weeks and PM was actually one of them. When there is panic, everything may come down regardless how good a stock is. This has created a great bargain for those long-term investors. Yes, PM is also on sale at the moment from its peak over $90 to low $80s lately. I’m happy to see this as I’m getting more shares via dividend reinvestment but at the same time I bought more PM stocks myself. I’m pretty sure those who are selling now will regret greatly when they look back in a few years. We have gone through this in 2008/2009 when I bought MO and at that time no one seemed to be interested in it. I wish we would see this kind of opportunity again but I won’t bet on it any time soon. The mini correction right now is probably the best opportunity for us for the foreseeable future.
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