Stock Picks – December 5, 2018

Stock Pick

It’s hard to believe that it’s been several months since I last posted a stock pick. The market has been very volatile of late however, making stock picking difficult.

US security markets are closed today. This will give you some time to research my latest stock pick to see if it would be a good fit for your portfolio.

I purchased 25-shares of United Bankshares Inc (NASDAQ:Unfortunately, we could not get stock quote for “UBSI” at this time. on Tuesday for $34 a share. United Bankshares is the holding company of United Bank, a regional bank operating in the mid Atlantic area with locations in 5 eastern states plus DC and traces their roots back to 1839 as well as non bank subsidiaries offering other financial and investment services.

UBSI is currently paying a 3.76% dividend ($1.36), and have been increasing their dividend regularly for 45-consecutive years, although not every year has seen a dividend increase.

Their 52-week range is $31.01-$39.95. Their 50-day moving average is $34.34 and 200-day moving average is $36.65.

Their Trailing P/E is 17.05 and a projected forward P/E is 13.43.

My intention is to hold long-term and purchase additional shares of UBSI. Once I hold 100 shares I will start selling covered calls options to increase my cash flow in this holding. By combining options premiums with dividend payments I anticipate having approximately a 15% annualized positive cash flow in USBI. At this stage of my life I will have the dividend portion on automatically reinvest in additional shares of USBI (“dividend reinvestment program” or “DRIP” for short”) while I will use the options premium to purchase other securities. Once I retire my goal is to be able to live off the dividends paid and the options premiums I collect, without ever selling the underlying securities.

I have been (and still are) light on the financial sector and will likely be adding more financial stocks in the coming months.

Print Friendly, PDF & Email

Stock Picks – August 13, 2018

Stock pick

I believe one of the best deals currently is AT&T (NYSE:T 30.14 -0.39 -1.28%). When something thinks of AT&T they typically think of a telecommunication company, which sells cell phone service, telephone lines, fiber connections, perhaps satellite TV (DirecTV), cable TV, and over the top TV (DirecTV Now and Watch TV). In other words AT&T is a content connector. They connect you to content.

And this assessment of AT&;T would be right, if this was still May. In June, AT&T morphed from being a content connector into being a content connector AND a content provider with the purchase of Time Warner (known post merger as Warner Media). AT&T now owns power house brands such as HBO, Cinemax, Turner Broadcasting (TBS, TNT, CNN, Turner Classic Movies, Cartoon Network, Bloomberg, and TruTV) , Warner Brothers (one of the big 6 film studios), DC Entertainment/ DC Comics, and much more. They operate NBA.com and NBA TV, NCAA.com, PGATour.com, PGA.com, and much more.

Check out this list of assets now owned and controlled by AT&T.

This merger now makes AT&T the 5th largest company in the United States, and one of the largest in the world. However, Wall Street, while knowing about the merger doesn’t seem to understand what AT&T just did and the moat they just created. For a quick exercise look up T on the stock brokerage of your choice and read the company profile. There is basically no mention of the WarnerMedia subsidiary. Basically Wall Street is comparing them to Verizon (VZ 57.85 +0.17 +0.29%), Centurylink (CTL 17.22 +0.17 +0.98%), etc, when really they are a combination of Verizon and Disney (DIS 112.87 -2.87 -2.48%).

AT&T closed slightly down on Friday to $32.26 a share. They are down -15.6% over the last 52-weeks, and nearly at their 52-week low. They are slightly above their 90-day moving average ($31.87) and below their 200-day moving average ($34.11).

AT&T pays an amazing dividend of $2 per year (current yield 6.17%), which they have continuously paying (and increasing) for the past 34-years!
This is the second time I am choosing T as a MikesStockPick. I previously purchased shares for $31.07 in July and for $31.965 in August.

Print Friendly, PDF & Email

Stock Picks – July 26, 2018

Stock Pick # 1

I recently purchased shares of MongoDB Inc ((MDB 84.35 -6.39 -7.04%). MongoDB Inc was originally founded in 2007 and is the developer of the MongoDB database. I use MongoDB in some of the technology that I sell and service and their popularity continues to grow. They are still a small company but growing fast, having basically doubled year to date in 2018 and I believe this growth is not slowing down, but will continue for many years. I paid $57.54 a share.

Stock Pick # 2

Yesterday I purchased shares of Beasley Broadcast Group Inc (BBGI 4.78 +0.02 +0.32%), a large radio station ownership group. They were originally founded in 1961 and have been publicly traded since 2000. Beasley owns and operates 65 stations in 13 radio markets, including Las Vegas (where they have 5 radio stations). Their stock has recently fallen on news that one of their major shareholders was selling a bunch of stock, below what the market price was at the time, to help fund the purchase of a new radio station. Investors seemed worried that the stock would get diluted with a new offering, but it was as not a new offering this seemed to be a case of market over reaction. I purchased it for $6.90 per share.

Print Friendly, PDF & Email

Stock Picks – July 23, 2018

Stock Pick # 1

Today I purchased shares of telecom giant AT&T (T 30.14 -0.39 -1.28%). AT&T is currently paying a 6% dividend and has been continuously paying and growing this dividend for the last 34 years! Once its merger of Time Warner is finally complete, AT&T will be the 5th largest company in the United States. AT&T reports on their 2nd quarter earnings tomorrow and it will be the first quarter that will include financial information for Time Warner. With the purchase of Time Warner, AT&T is setting themselves up as a content creator. In many ways it seems like AT&T is becoming more like media giant Disney (DIS 112.87 -2.87 -2.48%), instead of simply a telecom giant.

I believe that the market will be pleasantly surprised with their earning report tomorrow and we will see a large jump in their stock price. I purchased shares for $31.07. However, I am also hedging my bets as I have another order in at $28.09 as one area of concern to me is the amount of debt that AT&T has, however I do not believe they are over leveraged at this time. But Mr. Market may decide tomorrow that they are over leveraged and will cause a large price reduction. Should that happen, I’ll buy some more on sale.

Stock Pick # 2

In my IRA I purchased shares of Main Street Capital (MAIN 37.58 -0.30 -0.79%). Main Street is a business development companies (“BDC”) who makes loans to small and lower mid market businesses in exchange for an equity position in their company. They have investments in a wide variety of businesses and have had good returns from their investments. They pay nearly a 6% dividend, but rather than paying it 4 quarterly installments as most companies do, they pay it in monthly installments! I paid $39.35 a share.

Print Friendly, PDF & Email