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billryan
billryan
Joined: Nov 2, 2009
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December 4th, 2019 at 8:46:29 AM permalink
Two plus years ago, my God-Mother passed away leaving ,among other things, about 25,000 shares of ATT. The Executor was supposed to sell them ASAP but he kept making one excuse after another. Meanwhile the stock fell from almost forty to under 30. Finally, he is ready to sell and the stock has rebounded nicely. The $50,000 in dividends complicates the tax situation slightly, but in the end, it was a near wash. Hopefully, the other stocks have gone up over the same period.
DRich
DRich
Joined: Jul 6, 2012
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December 4th, 2019 at 10:08:51 AM permalink
Quote: SOOPOO

Ended up buying BTI at $38.8. I don't understand why it is trading that low. At 38.8 it is paying 7% dividend, and has a pretty low PE ratio of around 11. Its a big company with a long history. Occasionally when I make an analysis I am missing something and it comes back to bite me! Time will tell.



I am disappointed in you. A former doctor investing in a tobacco company. Shame. I would be more likely to invest in RJ Reynolds with their dividend and I would guess a more stable investment.
Living longer does not always infer +EV
SOOPOO
SOOPOO
Joined: Aug 8, 2010
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December 4th, 2019 at 11:00:18 AM permalink
Quote: DRich

I am disappointed in you. A former doctor investing in a tobacco company. Shame. I would be more likely to invest in RJ Reynolds with their dividend and I would guess a more stable investment.



Mild correction. Not a FORMER doctor. If I die a senile blithering idiot I will still be a doctor. I do own Altria, which I think is the big competitor of RJR. I just googled it, and apparently BTI OWNS RJR!

I am not sure what my ethical standards are on this issue. I first owned a tobacco stock by accident. I bought a British conglomerate called Hanson which split off a part of it which was a tobacco company. I then decided as long as it was legal I would not divest because I detest smoking. If somehow smoking could be eliminated and my tobacco investments would be worth zero, I would be happy, not sad.
vegas
vegas
Joined: Apr 27, 2012
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December 4th, 2019 at 12:53:36 PM permalink
Quote: SOOPOO

Ended up buying BTI at $38.8. I don't understand why it is trading that low. At 38.8 it is paying 7% dividend, and has a pretty low PE ratio of around 11. Its a big company with a long history. Occasionally when I make an analysis I am missing something and it comes back to bite me! Time will tell.




I think it is probably undervalued because of the industry. What future does tobacco have? Every year more people quit. When I buy a stock I want something that will be needed or used in the future. Some times we don't know that a product will be obsolete in the future and sometimes we can see the writing on the wall. Look at kodak film. It was huge and everyone had to get their film developed to see the picture. Great stock and look at today. Who gets film developed anymore. Stock sells for a bit over 2 dollars. I remember buying some and I paid 20 dollars for it. We could not see this happening because we did not not have the technology at that time. Iphones were not invented.

However we can see the into the future and tobacco does not look too promising. Does this mean it is a bad buy. No of course not but I would not make it a long term hold. Just my thoughts. (love the dividend though)
50-50-90 Rule: Anytime you have a 50-50 chance of getting something right, there is a 90% probability you'll get it wrong
SOOPOO
SOOPOO
Joined: Aug 8, 2010
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December 4th, 2019 at 1:30:46 PM permalink
Quote: vegas

I think it is probably undervalued because of the industry. What future does tobacco have? Every year more people quit. When I buy a stock I want something that will be needed or used in the future. Some times we don't know that a product will be obsolete in the future and sometimes we can see the writing on the wall. Look at kodak film. It was huge and everyone had to get their film developed to see the picture. Great stock and look at today. Who gets film developed anymore. Stock sells for a bit over 2 dollars. I remember buying some and I paid 20 dollars for it. We could not see this happening because we did not not have the technology at that time. Iphones were not invented.

However we can see the into the future and tobacco does not look too promising. Does this mean it is a bad buy. No of course not but I would not make it a long term hold. Just my thoughts. (love the dividend though)



Thanks. I sort of knew that. For a while tobacco stocks were trading at a discount because the next lawsuit was already priced in. Agree on 7% dividend. To buy a safe bond today you may barely get 2%.
DRich
DRich
Joined: Jul 6, 2012
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December 18th, 2019 at 1:12:55 PM permalink
Soopoo, It looks like BTI is up over 12% in the last 30 days. I know you are in for the longterm, but 12% in 30 days is awesome.
Living longer does not always infer +EV
SOOPOO
SOOPOO
Joined: Aug 8, 2010
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December 18th, 2019 at 6:28:29 PM permalink
Quote: DRich

Soopoo, It looks like BTI is up over 12% in the last 30 days. I know you are in for the longterm, but 12% in 30 days is awesome.



I was going to post this, but thought no one would care! I truly believe I have NO stock picking ability over an average Joe. I DO believe my extreme diversification is the engine behind my success.

We shall see how I'm doing after the next election. I am moving some assets to REITs which are at least theoretically less correlated to the overall stock market.
DRich
DRich
Joined: Jul 6, 2012
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December 19th, 2019 at 9:57:30 AM permalink
Quote: SOOPOO

I was going to post this, but thought no one would care! I truly believe I have NO stock picking ability over an average Joe. I DO believe my extreme diversification is the engine behind my success.

We shall see how I'm doing after the next election. I am moving some assets to REITs which are at least theoretically less correlated to the overall stock market.



About two weeks ago I bought some Chewy.com (CHWY). It is up 14% in two weeks. My track record suggests that it should freefall before I cash out.
Living longer does not always infer +EV
SOOPOO
SOOPOO
Joined: Aug 8, 2010
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December 19th, 2019 at 5:08:04 PM permalink
Now up 66% since inception. Now up to around 18% in bonds. The market seems to go up no matter what is happening. The first trading day after a Presidential impeachment and the market goes up 1/2%. I'm the lucky beneficiary.
billryan
billryan
Joined: Nov 2, 2009
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December 19th, 2019 at 7:30:36 PM permalink
Tessa is up almost 100 points since I recommended it. I didn't expect that.

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