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Plum Creek Timber Co. Inc. Message Board

  • dale-reed Oct 19, 2011 2:23 PM Flag

    Buy or Sell?

    I have considerable investment in Plum Creek. Mostly for the dividend but even though it has a high P/E it should go up when new houses start building. But droughts, fires, bugs, aging trees are threats.

    I am 76 years old and healthy so have another ten years of investing. PCL is down from when I first started buying.
    Am I missing anything?

    Thanks for the advice.

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    • Seems like management knows what they are doing with a solid balance sheet. If you are hoping for huge increases in share price you are probably not going to see it but 5-7% a year return seems pretty good to me.

      Wonder what would happen if inflation and interest rates began to spike? People like hard assets in an inflation but if interest rates spiked, who knows. In the 70s land prices were spiking so that is my guess.

      They've done pretty well in a deflationary environment over the last couple of years.

      I'm guessing a good solid hold.

    • Hello Dale

      Although PCL has been a steady performer over the years with a decent ROE and dividend I'm not sure they will make match earnings estimates tomorrow 24 oct.

      PCL's business is now subject to stricter environment policies, thanks to the recently empowered environmental wackos. It's been downgraded recently by USB and Zacks to a sell.

    • You will also get Irish ole time bluegrass music as a bonus! The beaches of the North Carolina "Outer Bank's" are just a few hour's drive from places such as Stuart, Virginia.

    • If we go into a deflation environment, I would not hold PCL. PCL has huge debt. Too bad there is not a timberland corporation out there with near zero debt.The world is in the process of a huge deleverage of debt. That is why,a person can only get around only 1% in bank CD's. My advice would be to invest in growing dividend corporation's with near zero debt.

      • 2 Replies to jerrykerry72
      • You're right! That's why I have a big position in Chubb (CB). 46 consecutive years of dividend increases is hard to beat. The most recent earnings were down significantly because of hurricane damage, but that's now fully built into the share price. They're increasing premiums by about 4% going forward due to the recent claim history. That's one of the nice things about the insurance business; if you get hit with loss claims, you just make up for it by raising premiums. I view PCL as rather risky for someone who is 76, no matter how long he might expect to live.

      • As a trader, i am mostly in cash, but if were to hold a corporation, with little risk, and relatively a good dividend, MSFT would be my choice. I do not hold the stock,but it is relatively "safe", with growth also. No debt.

    • dale - at 76 and healthy - sounds like the only thing you are missing is a young chick (in her 50's) and a motorcycle !