Tag Archives: debt

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The dice are cast – 3M will have to cut its dividend

My long-time readers know that I have pointed my shotgun at candidates with likely coming dividend cuts. I even made two Weeklies out of this topic, as I am still convinced that dividend cuts will be one of the mega trends of this decade, and a fairly underestimated one! There are several companies where I am seeing massive operating and financial issues. In this latest episode, I am targeting again the famous industrial conglomerate and inventor of post-it stickers, 3M.

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Turnaround-bet: Is Vodafone’s 10% dividend yield a no-brainer?

The British red telecom giant announced not only a CEO-change, but also a strategic shift (both often come as one). Meanwhile, the share price is advancing its year-long decline, reaching even a fresh quarter-century low (!), as investors seem totally unimpressed. In the past, Vodafone has been a reliable dividend payer, although the payout was cut in 2019 and not raised again since then. The 10.7% yield seems tempting. Can it get worse or is it worth a shot?

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Deep Dive into Offshore Energy Drilling – coming back from the near-dead + new research report

Not only being one of the most cyclical, but also most hated energy sub-sectors, offshore drilling has been a secure investment grave for the last nearly 15 years. There is barely any investment topic where you could have sunk money more reliably. However, there are really interesting developments that make it worthwhile to risk a look into it, again. Especially, as along as it is perceived a no-go area for ESG-promoters – although offshore drilling tends to be the best choice in this regard.

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Earnings quality the worst in three decades – look at free cash flow!

Operating or net income, adjusted operating or net income, earnings per share (EPS), adjusted EPS and the price to earnings (PE) ratio are commonly used to assess a company’s business results and to value it. They are also often used as headline numbers and proof of performance by the companies themselves. However, there is a rising trend of decreasing “earnings quality” – an indicator that neither the economy is doing pretty well, nor many companies.

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Big Pharma to destroy shareholder value? + new research report for Premium Members

Stocks of big pharmaceutical companies have been core holdings in many portfolios for as long as I can remember, probably even beyond that. The reasons are crystal-clear: an ever aging population, more chronic diseases also among younger generations, stable to slightly rising demand throughout the business cycle, relative price stability of those stocks and reliable dividends. What’s not to like?

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Megatrend of this decade: Dividend cuts + an update to my most popular article so far

Even though I know that I certainly won’t make many new friends with this article, especially not from the ranks of dividend investors, it is a duty for me to address this topic. I also think, it’s no coincidence that my most popular article to date has been about looming dividend cuts. Simply put, it’s too important to be ignored.

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A king is falling – why Altria’s butt is burnt down

Altria is a stock from the illustrious circle of the “dividend kings”. It is even so special that it has actually raised its dividend more than once a year over the past half century – 57 increases over 53 consecutive years. However, the last few years have been disappointing in operational terms. Recent results, in particular, have shown the direction this company is likely to take. There are still a few puffs left, but don’t be surprised by the impending dividend cut at this darling of many dividend investors.

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Will Deutsche Bahn (DB) finally be broken up? + new research report!

In the past, this question was a no-go. On several occasions, speculation about at least a sale of non-core business units was put on the table, but quickly buried again. Over time Deutsche Bahn has accumulated so much debt that its barely profitable core operations cannot handle these obligations. An eternal zombie existence on government life support is not a viable solution. And then there is the ambitious investment offensive to modernize and expand the existing rail infrastructure. Is it finally time to break up Deutsche Bahn?

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Zombie companies – The Walking Dead?

Being dead and being alive are mutually exclusive conditions. But with stocks, there are companies that to a large extent fit into this scheme. Now facing a heavily toxic cocktail of likely higher interest rates and a slowing economy, many of these businesses will be tested for their survivability. Even if they do survive as a whole business, it is nonetheless dangerous to invest into equities of heavily indebted zombies – no matter how high the temptation might be.

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Dollar stores with discounted prices, but expensive shares

Physical retail stores as a whole in most developed countries have more likely than not reached their peak. However, there is a sub-category in this sector that is expanding quickly. More than that, the so-called “dollar stores” have even been beneficiaries of a diminishing middle-class. Are the respective stocks a good investment idea, especially as inflation is trimming budgets?

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