I sold everything on Monday at $15.25. The sustainability of the dividend concerns me. Moreover, the mention of expanding to Boston and NYC strikes me as imprudent. I just don't see the present management as being ready for prime time in those hugely competitive markets. IMO, there are already too many bank branches in the big cities. PBCT needs better management from the top down to the local branch managers that will provide a better customer service experience, not more branches.
Stocks that get stuck in a narrow trading range can often be good money-makers if you spend the time and effort to stay on top of them. Identify the top and bottom of the range and use it to your advantage. If you happen to catch a dividend along the way, it's an added bonus. I've done this successfully for many years. You just have to resist the temptation to "get married" to a stock when it hits your sell target. I just look for stocks with clear sideways channels and an 8% to 10% spread between the tops and bottoms. Commissions are so low nowadays that they're not really a factor. Just stick with stocks that have good fundamental value and reasonable stability in their financials to avoid unpleasant surprises. PBCT seems to fit the bill very well.
Those who bought yesterday will soon regret doing so. CAT has had many false starts that all fizzled miserably. As for Cramer's judgement that the CEO is a "nice guy", all I can say is that "Nice guys finish last."
The infrastructure boom has been talked about for about as long as I can remember. It's not going to happen as long as Republicans control the purse strings because it involves spending money. An improving job market is tied directly to spending on infrastructure, therefore it's not likely to happen soon for the same reason. The Fed has the power to control the money supply, but it doesn't have the power to influence spending on infrastructure. It can only prop up stock prices and housing by keeping interest rates artificially low. I suspect that the Fed would love to see a big government spending program centered around rebuilding and repairing infrastructure, but they can't make it happen in this era of dysfunctional branches of Congress. In fact, the Fed seems to be the only "branch" of our government that is working. There's no question that CAT would be a huge beneficiary IF the present log jam can be broken, but I'm not at all optimistic. I also fail to see how cutting taxes, especially on the rich, will accomplish anything other than making the rich richer and the poor poorer. As I see it, the U.S. is in a semi-permanent state of recession/depression that could go on for as long as our dysfunctional government stays in power. This does not bode well for CAT.
(Yes, I know the Fed is not a branch of government, but perhaps it should be. I seem to remember hearing many Republicans in the 2012 primaries -- Perry, Paul, et. al. -- talking up the idea of disbanding the Fed altogether.)
Totally agree. Those buying CAT for the dividend are taking on a lot of risk for a very low yield. Moreover, if they're reinvesting the dividend through a DRIP, they obviously don't need the income to live on. Therefore, they're in CAT for all the wrong reasons. When the inevitable correction comes, CAT has a lot of room on the downside from here. Given how far the market has risen without any participation from CAT, there's no reason to believe that CAT will do any better during a declining market. CAT is already in its own "bear" market.
You're living very dangerously. The market is due (over-due, perhaps) for a correction, but the trend is decidedly UP. I think there's a high likelihood of a 5 to 8% pullback in the next several months, possibly in late December. It all depends on what the politicians in D.C. do at the end of December on the budget situation. Last year I loaded up on VTI on December 30 and 31, and I'm now up 29.22%. We could very well see a repeat of the same thing again this year. I expect 2014 to be a lot more volatile than 2013, but I think the first half of the year, at least, will be generally up. I'm not saying the economy is doing great, but with interest rates near 0% and likely to stay there, stocks are the only game in town.
I agree. This is a terrific opportunity for investors to dump CAT before it goes lower... a LOT lower. CAT might also be replaced in the DJIA within the next few years. If new natural gas fueled engines replace diesels, CAT will be the next EK. I see it happening before the end of the decade.
Wrong. I have 9600 shares. I don't call what AMGN pays a "hefty dividend yield." Under 2% is better than what they paid until very recently which was zilch, but it's far from "hefty." Meager is more like it. AMGN is one of my worst performing stocks. Since 2000, it has been nearly dead money compared to most of my other holdings. If it were not for the fact that I'll probably die fairly soon, and I want to avoid paying the capital gain tax, I'd have sold it.
AMGN does it again! This has been the pattern for the past 14 years. Looks like just another chronic under-performer doing what it does best... under-performing.
How often do mutual funds split their shares? Fact is, share price is only related to what investors perceive the intrinsic value to be. If you own Google, Priceline, Apple, or any of dozens of other companies, do you really care whether you own 100 shares at $1000 or 1000 shares at $100? When I was in the business in the 1960s and 70s, it was nearly impossible to enter an order by dollar amount; everything was traded in share units - usually round lots of 100 shares. Now, it's no more expensive, commission-wise, to buy in dollar amounts than share amounts. The world has changed drastically; get used to it. Adapt. The best thing that has ever happened for investors was the demise of fixed commissions and odd-lot penalties. My broker charges no commission on the first 25 trades each year and just $2 per trade after that. The dollar amount is irrelevant. It's almost too good to be true!
Many investors point to the dividend as a rationale for buying the stock here.
While dividends play a critical role in generating long term returns, they alone rarely provide the typical required rate of return (for equities generally 7-9%). A high dividend stock can still be above intrinsic value, and when one buys at that level, they will generate mediocre long run returns. The dividend argument could have been made two years ago in CAT when the stock was trading at $95 just as well as it is made today. Since then, the stock has been nothing but dead money while the S&P 500 rallied 40%. Investors would have been wise to recognize that despite its dividend, CAT was trading beyond fundamental merits and moved into another stock that was trading at a discount to fair value. Dividends alone do not guarantee acceptable returns, especially when you purchase over-priced stocks.
I agree totally. Earnings are likely to disappoint next week. The dividend is NOT a reason to buy. Capital appreciation is the name of the game; the dividend is a nice bonus but only if the stock is going up.
I expect DE to drop a bomb in their upcoming report next week. If the stock has any kind of a run up going into the report, I'd bail out and run for the hills. It looks to me as if it's headed down to the mid-70s, if not lower. Don't be suckered into buying if the stock looks strong right before the report. That's what CAT did - ran to over $89 - and then crashed in AH.
That's somewhat extreme. You don't kill someone just because he's inept. On the other hand, shareholders should have seen this coming. I did. That's why I sold yesterday at $23.85.
Keep dreaming. No short squeeze with this dog. The shorts are the only folks making money with CAT. Headed lower. Much lower. Buy at $73.
If this is the reason you're in JBLU, you're barking up the wrong tree.