She bought more VZ today putting it in her top 10.
Congratulations VZ you're now have the Grandma seal of approval.
February of 2014--"New top 10: #1 & 2--PM and BRK-15%, #3-LO-7.9%, #4 & 5-WFC & IBM-5%, #6-MSFT-4.6%, #7-AIG-4.2%, #8-USB- 3.8%, #9-COP-3.3%, #10-KO-2.9%. Note--MO is in 11th place at 2.5% and she may buy more on any additional weakness because she likes the dividend yield."
KO is now ranked #11 at 3% of her assets.
Note- She now receives monthly checks from this account that equal about 4% per year. Year to date she's up about 8% so she's gaining ground.
Which puts it in her current top 10--BRK-17%, PM-12%, LO-7%, BX-5.5%, WFC-5.2%, MSFT-5.2%, AIG-4.1%, IBM-4.1%, USB-3.6%, VZ-3.5% and MO-3.2%
She increased her position in VZ today by 50% paying 48.21/share.
MO helps to offset her paper loss in IBM which is still in her top 10.
Grandma may make an offer to buy all of IBM for $200 billion a 20% premium to today's value. She'll issue $199.99999999 billion in debt at a cost of 2.5% and pay all the debt off in less than 12 years using the proceeds from IBM's free cash flow generation.
With 10 year bonds earning less than 2.5% any hedge fund or group of hedge funds could make a play for IBM at its current price. Even if they were forced to pay 5% interest the deal still would work but it would just take longer to pay off the debt. But with Grandma's credit score she'll have no problem finding cheap cash.
"She upped her position by 74% using proceeds from a bond and CD sell".
"She went from earning an average of 2% to 5.4% via the MO dividend which could be as high as 6% next September."
She hit that one out of the park. Her cost basis dividend yield for this buy is 5.85%
Thank you MO.
I'm in all but GILD, CELG and BLK, however I do follow BLK because I may take a position in the future.
I did take a 1% position in VZ today in IRA #1 which still leaves this account 38% cash which is used to sell put options. I also sold more put options against VZ today.
This account earns about .5%/month selling options so today's buy takes two months to earn.
The future of IBM's market cap--Less than $100 billion with a stock price over 500.
I hope Buffett lives to see it.
"Down is good"? If IBM were to drop under 100, BRK could buy the entire company for less than 5 times its free cash flow numbers, wouldn't that be good thing?
Or we just let them continue to buy back most of their shares until we own 50% and then buy it out as was the case with Geico another BRK plunder.
I did sell some shares last week in my personal accounts and I also sold call options against it, but I never sold a share in my IRAs. I know and everyone knows they have declining revenue but historically their free cash flow numbers have been fantastic so I'll continue to hold and try and sell call options against it when it's advantageous to do so.
It could be general market fear or hedge funds may have been forced to sell for liquidity reasons.
Check out the spreads now with their stock options both puts and calls. It comes down to market fear or perhaps the risk of the deal going through is greater than one might expect.
He said it was a 15% grower trading at a P/E of 15.
Actually I have it at a 12% grower trading at over 17 times next year's earnings.
But with 10 year treasuries earning 2.2% GOOG is still reasonably priced.
I'm long a very small position and may buy more if it drops under 480.
Good call------I own it via BRK and I used to sell put options against it when it was priced under 150. I'm still short puts that expire next January but they're priced under 120..
In other news-I'll be buying some INTC and BX in IRA #1 today due to put options I'm short. My plan is to increase my dividend income in this account by 50% in the next year using high yield stocks like COP, BX, VZ, STX, MSFT, preferred stocks and others..
Check out the spreads on the various options and one can only conclude that nobody knows anything as usual.
Note-I'm currently short both out of the $$ puts and calls, most of which expire prior to the next earning's report and I'll sell no more until the spreads narrow.