One of my largest holdings and growing is Diageo plc (DEO), which was one of my 2009 stock picks. At the time I recommended it, I figured that the economy was going to drive everyone to either church pews or bar stools and that rational worked out. Today, in a battered market, folks must be hitting the bottle because Diageo is up when the majority of stocks are down. During the day it touched a new high of $73.63. (Update: Final $72.76)

There are very few stocks that I might say are a must own as a core holding. However, unless you think alcoholic beverages are going out of style, Diageo might be one of them. Trading at a 52-week high and surpassing the market last year and so far this year, too, the metrics are starting to look average. But several things do jump off the page on closer inspection. One is the whopping 46% return on equity and the other is the 3.3% dividend yield.

Continue reading Chasing Value: Diageo New High on Full Bar Stools

Chasing Value: Diageo New High on Full Bar Stools originally appeared on BloggingStocks on Tue, 19 Oct 2010 16:00:00 EST. Please see our terms for use of feeds.

Continue reading Chasing Value: Ten stocks for 2010 -- Part 9 + Apple

Chasing Value: Ten stocks for 2010 -- Part 9 + Apple originally appeared on BloggingStocks on Thu, 10 Dec 2009 15:40:00 EST. Please see our terms for use of feeds.

Continue reading Chasing Value: Ten stocks for 2010 -- Part 1

Chasing Value: Ten stocks for 2010 -- Part 1 originally appeared on BloggingStocks on Wed, 11 Nov 2009 16:40:00 EST. Please see our terms for use of feeds.

Continue reading Chasing Value: 2009 blazing picks -- Q3 review

Chasing Value: 2009 blazing picks -- Q3 review originally appeared on BloggingStocks on Tue, 10 Nov 2009 14:40:00 EST. Please see our terms for use of feeds.

One of my wonderful friends, Ms. P, asked me for some guidance on how she might allocate $50,000 currently earning peanuts in a money market account. Though she is decades from becoming a grandmother, after a brief discussion about her financial parameters, it became clear to me that she was looking for a "granny fund."

In reality, my recommendations would be suitable, and perhaps desirable, for many passive investors as well.

The $50,000 is a portion of money Ms. P has set aside to purchase a home, which might happen in six months, but could also be pushed out further, depending on the economy and her situation. Basically, she wants to cover all her bases because she might need the money at any time and does not want to be caught short, while at the same time she would like to generate some revenue without taking any big risks.

Continue reading Where should granny put $50,000?

Where should granny put $50,000? originally appeared on BloggingStocks on Fri, 09 Oct 2009 15:40:00 EST. Please see our terms for use of feeds.

Continue reading Sin stocks are blessed -- Diageo rewarding investors

Sin stocks are blessed -- Diageo rewarding investors originally appeared on BloggingStocks on Fri, 19 Jun 2009 14:20:00 EST. Please see our terms for use of feeds.

Anybody have capital gains to show this year? I didn't think so. Not unless you were shorting the market, and in particular financials. I got clobbered with everyone else. There were not many places to hide. Picking winners was like guessing where each piece of debris would land after the tornado moved through town.

The average crystal ball is looking quite foggy about now, nevertheless I have rummaged throughout the stock market to select nine stocks that I think offer more reward than risk. The market is priced for the worst in so many cases that I think the list could have included 50 companies without too much trouble.

In 2007 and 2008 I owned some but not all of the picks for the year. This year I own all of the stocks and they were all acquired in the latter part of the fourth quarter for a new portfolio.

Continue reading Chasing Value: 9 picks for 2009 -- APC, GE, ISRG, WFC and more

Chasing Value: 9 picks for 2009 -- APC, GE, ISRG, WFC and more originally appeared on BloggingStocks on Wed, 31 Dec 2008 12:45:00 EST. Please see our terms for use of feeds.

Most mergers are driven by the notion, sometimes wildly mistaken, that the combination will bring both a competitive advantage. Some pairs of companies, however, seem so intuitively right for one another, no bottom-line considerations should be allowed to interfere with their matrimony. Like an empty rental and a copper thief, these two seem drawn together

The leader in the mortgage meltdown, Countrywide Financial (NYSE: CFC) managed to leverage its bon-homey, don't-ask-don't-tell lending policies into a corporate disaster. Where, you might ask, can it turn to make lemonade out of these lemons?

To answer this I asked myself, what do people do when the mortgage bill is greater than the sum of their paychecks, savings, hockable goods and child's piggy bank? Usually, when the going gets tough, the tough go drinking. Who, then, would be a better partner for Countrywide than distilling giant Diageo plc (NYSE: DEO)?

The newly dispossessed won't be drinking alone, either. With the CEO selling off his holdings, the SEC reviewing the company's stock option awards, and massive layoffs through the industry, millions of us with a piece of the mortgage business could use a stiff shot of J&B with a Guinness chaser.

Continue reading Mergers I'd like to see -- Countrywide (CFC) and Diageo (DEO)

Mergers I'd like to see -- Countrywide (CFC) and Diageo (DEO) originally appeared on BloggingStocks on Thu, 25 Oct 2007 16:05:00 EST. Please see our terms for use of feeds.