Tag Archives: Dividends

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Have popular consumer stocks fallen enough? + new research report

For several years now, investors have been wondering when consumer stocks will finally bottom. Once foundational safeguards across many portfolios and mainly bought for their dividends, and not their share price appreciation (though welcome), defensive consumer stocks have created strong headaches for those who bought at high multiples, ignoring the big fundamental shift that happened (Financial Engineering readers have been warned about). Naturally, at some point, there will be a bottom, though. Are we there yet?

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RTL Group: Is the 15% dividend worth a look?

Everyone knows linear tv is in perpetual decline. Less and less people are watching traditional television — many do not even own a tv anymore. Streaming services have grown in popularity and taken market share. Germany’s biggest private radio and television conglomerate, RTL Group, is in the midst of a turnaround by pushing its own streaming service, but also by expanding sports live broadcasts. What might lead to raising eyebrows is the company has declared a dividend yielding 15%. Could this be the ultimate contrarian play?

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Flight into mergers: the solution for “defensive” consumer companies?

One of my favorite topics (and targets for criticism) for quite some time have been consumer companies. Especially those with a seemingly defensive business model that in the past offered stability in times of market stress. This recipe does not seem to work anymore, though. First and foremost, food companies have experienced an unprecedented bear market that caught many risk-averse investors on the wrong foot. When stocks have fallen significantly, takeover interest arises. Is this a sign that shares of consumer staples have fallen enough?

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Safe 20% with Kenvue?

The case of the world’s biggest pure-play consumer care company, Kenvue, is a special one. What makes it interesting is that despite being the primus inter pares, it fetched a 48.7 billion USD bid in November 2025. However, there’s a notable gap of around 20% between the takeover price and where shares currently trade. Could this be an idea, entirely uncorrelated to the broader market, for 2026 for “safe” 20%, if the deal closes?

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Reading the tea leaves of Associated British Foods + new research report

Despite my negative view on food and beverage stocks, I have not given up. Associated British Foods, or ABF in brief, appears to offer one of the better setups on the menu. The maker of Twinings Tea is still family-controlled and it has a clean balance sheet. These two points alone dramatically differentiate it from other troubled competitors. However, ABF itself isn’t free of challenges either. Its “defensive” stock last week collapsed after a disappointing trading update. In this weekly, I take a look at ABF, as there’s a potential catalyst on the horizon. Good news for all my paid-members: I’ve finally found a food stock checking my boxes. My first member eggs-clusive research report for 2026 is out of the cage.

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Conagra Brands: A “defensive” consumer stock with an aggressive balance sheet

One or the other time, I have published a weekly about consumer stocks. My general view has been for years that these names should be avoided, being it food, beverage, or alcohol stocks, partly also household and cleaning producers (except one name I published a research report about, it’s up +22% over the last five months). Investors who bought blindly solely based on past performance have suffered big losses. While hopes for a turnaround to finally arrive continue to be high, there’s little reason to be overly optimistic. These stocks have lost their status as “defensive” core positions not for one, but for several reasons. The case study of Conagra Brands.

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Nine lost years — Bottom in sight for Nestlé?

Since its peak at around 130 CHF per share and a market cap of almost 400 billion CHF, consumer staples heavyweight Nestlé has highly disappointed its fan base of predominantly defensively oriented investors. Who’d have thought that THE core investment in the consumer staples sector (besides Coca-Cola) could see its stock price get almost cut in half? Although I have not written a weekly about Nestlé so far, my readers know that Nestlé has not been interesting all the time. Is it now worth a look?

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My next Target for a Dividend Cut is a King

I stick to my view which many investors don’t share: this decade will be remembered as the one where dividends have been cut, not sparing big names. With this, I do not mean the obvious candidates like cyclical commodity producers or European car makers, but the ones where it really hurts (for dividend and income investors). In the past, I have written several weeklies, digging out names with proud series that have come to an end or with a high likelihood will end in the not-too-distant future. My next target is another dividend king.

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Has Big Pharma destroyed Shareholder Value (as expected)?

In March 2023, I published a controversial weekly, warning about investments in Big Pharma stocks. This group, often popular among retail investors for their dividends and pretend safety (size, diversification, proven, etc.), was already back then clearly facing a huge wall of painful patent expirations. As I had expected, many of the biggest — and most popular — names have seen their stocks painfully breaking apart while broader markets rose. Time for an update.

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Don’t skip this: Why I‘ve been (+ remain) negative on consumer stocks

I must admit I am surprised how angry people can become when their widows and orphans stocks, mainly consumer staples with reliable dividends, are attacked. It is no secret that I‘ve been writing and commenting negatively about them for some time. And I was right in most cases, as these “safe bets“, which according to the fan base belong in every defensive portfolio, have performed very poorly. I stick to my view that the dividends won’t be safe over time. Once and for all, I am now unveiling why my pessimism likely is warranted.

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