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> 10 % Dividend Yield........my new yard stick in NSE stock picking
Rank: Veteran Joined: 8/28/2015 Posts: 1,247
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Dividend/market price. Its a payback estimation means if the investorl assumes zero amortisation value in a way. Its a wonderful method if you played it well but misleading for growth companies with a conservative dividend payout ratio/ policy. There are other risks to it if mgt does some cooking/ doctoring to achieve unsustainable payout ratio. Its equivalent to inside pumping job eg Mumias vs kidiru style. ,Behold, a sower went forth to sow;....
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Rank: Member Joined: 12/1/2007 Posts: 539 Location: Nakuru
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muandiwambeu wrote:Dividend/market price. Its a payback estimation means if the investorl assumes zero amortisation value in a way. Its a wonderful method if you played it well but misleading for growth companies with a conservative dividend payout ratio/ policy. There are other risks to it if mgt does some cooking/ doctoring to achieve unsustainable payout ratio. Its equivalent to inside pumping job eg Mumias vs kidiru style. I guess that's why he deploys this method during bear times For investors as a whole, returns decrease as motion increases ~ WB
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Rank: Member Joined: 9/11/2015 Posts: 244 Location: Thika
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stocksmaster wrote:stocksmaster wrote:stocksmaster wrote:stocksmaster wrote:stocksmaster wrote:Hunderwear wrote:stocksmaster wrote:stocksmaster wrote:With the index first approaching the 3000 mark, my stock picking focus is now on dividend yield.
For my long term portfolio, i am focusing on stocks that assure me at least a 10% Dividend Yield at prevailing prices. My focus therefore is now on the following stocks:
1. Kenol Kobil - At Ksh 9.30, and with management having assured investors of at least USD 35M net profit (EPS of 2.15 at 45% dividend payment policy) with a dividend of about Ksh 1, this represents 10.75%. Am hoping for a price dip below Ksh 9.00 to undertake massive purchases although am already buying at prevailing prices.
2. KCB - At a projected dividend of Ksh 1.50 for 2011, the price of Ksh 15 represents a 10% dividend yield. Am buying at price dips below Ksh 15.
3. Williamson Tea - Having paid Ksh 15 dividend last year on an EPS of Ksh 97, the company made 91% of this money in 1st Half 2011 alone. Am projecting an EPS of Ksh 135 - 140 for the full year. The company is awash with cash and can comfortably give Ksh 25 - 30 as dividends for 2011. I'll be buying at any price below Ksh 250.
As prices continue to dip, my 10% principle brings more companies into focus.
Happy Hunting. Its 4 months since i adopted the above investment strategy and a good time to analyze the progress so far: 1. KenolKobil - Purchase Price: Ksh 9.30 ; Current price: Ksh 12. 75 Gain: Ksh 3.45 ; % gain = 37% 2. KCB - Purchase Price: Ksh 15 ; Current Price: Ksh 23.75 Gain: Ksh 8.75 ; % gain = 58.3% 3. Williamson Tea - Purchase Price: Ksh 186 ; Current Price: Ksh 232 Gain: Ksh 232 - 186 + 50 (Interim Dividend)= Ksh 96 ; % Gain = 51.6% The three picks have ourperformed the NSE index (NSE Index has risen about 18% since then). Am evaluating the three stocks in light of the prevailing market conditions, the capital gains etc and will soon post my next move concerning the three picks. Happy Hunting......... With such returns so far you can take a holiday for the rest of the year comfortably!!!!!!What your new strategy Its six months (Dec 2011 to May 2012)since i started this thread and since then, the scenario is as follows: 1. Kenol Kobil - A potential buy out at around Ksh 20 will be at least 120% return on investment. 2. K.C.B - Current price Ksh 23 after a dividend payment of Ksh 1.85. (Ksh 23 + 1.85 = Ksh 24.85). Thats a 65% return on investment. 3. Williamson Tea - At a price of Ksh 273 (Plus an interim dividend of Ksh 50) = Ksh 323 Thats a 73% gains and the end of year results are yet to be released where i expect a second dividend of at least Ksh 20. Happy Hunting. Seven months down the line and the scenario is as follows: 1. KK - (Purchase Price=Ksh 9.30; Dividend since purchase=Ksh 0.43). With the expected buy out, it seems to have found some price stability at Ksh 16. Am holding out for Puma cash which i anticipate will be > Ksh 20 (at least 25% more than if i cashed in now). 2. KCB - (Purchase Price=Ksh 15; Dividend since purchase= Ksh1.85). The price seems to have stabilized at Ksh 23-23.50. It is still undervalued; price target is Ksh 40 by April 2013. 3. Williamson Tea - (Purchase Price = Ksh 186; Dividend since purchase = Ksh 57.50). The 2nd half of their financial year was greatly affected by weather. However, they still managed to announce an EPS of Ksh 93 for year ended March 2012. Of importance is that for the last 3 years, the company has announced EPS in the range of Ksh 93-97 hence signaling a new high normal in profitability. Remove the biological assets (non-cash profit) component from the profit and this gives cash profit of Ksh 50-60 yearly. The tea prices are currently at new highs ($3.70-3.80 per kg) and with the precipitation experienced over the last few months, a possible continuation of this trend in profitability is expected. The company has given me a dividend yield of 31% within 7 months!! Am holding onto this one as the future looks bright for Williamson tea (and also my price target of Ksh 400 is yet to be met). Going forward: I am currently accumulating the following 2 counters: 1. Rea Vipingo - At Ksh 16 - 16.50; The company announced above normal EPS last year (Ksh 7.79) which the market assumed was a one off. However, half year March 2012 produced an EPS of 3.47 (Versus Ksh 2.56 for 2011) which indicated last year’s profits were the new normal and could be replicated easily this year. The diversification into horticulture seems to be paying off handsomely (they leased some land in athi river (130 acres) which they are growing baby corn, etc for export in addition to their horticulture project at Kibwezi (250 acres)). Last year, they raised their dividend from Ksh 0.80 to Ksh 1.10, and I project at least a dividend of Ksh 1.50 for the year ending September 2012 based on a Ksh 6-7 EPS for 2012. They hold enormous real estate in Kenya and Tanzania (In Kenya – Kibwezi: 22,215 acres; Vipingo (Near the exclusive Vipingo Ridge): 10,575 acres http://www.businessdaily.../-/wghxkwz/-/index.html
; and Tanzania: 36,660 acres) and are constantly increasing their sisal acreage. The diversification to horticulture is a sound strategy for this agribusiness company. This is a company to watch going forward. 2. KCB – The price of Ksh 23.25 - 23.50 is too enticing to ignore what with my price target of Ksh 40 within the next 10 Months and a dividend of Ksh 2 for 2012. Happy Hunting. KCB seems to have proven me right................I see a Ksh 30 on the near horizon and Ksh 40 within the next 10 months. Happy Hunting KCB should surpass the Ksh 30 barrier in the coming days.........Ksh 40 by May 2012 doesn't seem unrealistic now, does it? Rea Vipingo now in the Ksh 18 region.....Ksh 20 in the next two months. KK - The buy out seems to be dragging on very slowly..........the price of Ksh 14.20 forces one to hold. A target of Ksh 18 for some booking of profits. Williamson Tea - A price of Ksh 250 by end of December. Happy Hunting. It was a good year especially the capital gains from KCB, KK and dividends from Williamson Tea. On average, based on this 10 % dividend yield strategy, my net return on investment for the duration equal to one calender year is about 65% (Compared to a 30% ytd NSE 20 share index gain). Going forward, i have been liquidating most of my NSE holdings. Am of the opinion the current NSE rally in prices is a characteristic fattening before the slaughter. The March 2013 election is a reality that cannot be wished away. I forsee the index shedding at least 500 to 600 points to level at the 3500 - 3600 range before the March 2013 elections if political temperatures are kept low. Any rise in political temperatures in the next three months will surely erase the current 30% ytd gain. With so many variables hinged on our political process, i have decided to play by Young's Principle : Cash is King. I may well be wrong (that our market has divorced politics from its activities) ..........but i doubt it. The cow looks fat enough....can it get fatter or is it time for slaughter? Time will tell........ Happy Hunting. Good job. Impressive. Since men have learned to shoot without missing, I have learned to fly without perching
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Rank: Elder Joined: 9/23/2009 Posts: 8,083 Location: Enk are Nyirobi
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Jon Jones wrote:stocksmaster wrote:stocksmaster wrote:stocksmaster wrote:stocksmaster wrote:stocksmaster wrote:Hunderwear wrote:stocksmaster wrote:stocksmaster wrote:With the index first approaching the 3000 mark, my stock picking focus is now on dividend yield.
For my long term portfolio, i am focusing on stocks that assure me at least a 10% Dividend Yield at prevailing prices. My focus therefore is now on the following stocks:
1. Kenol Kobil - At Ksh 9.30, and with management having assured investors of at least USD 35M net profit (EPS of 2.15 at 45% dividend payment policy) with a dividend of about Ksh 1, this represents 10.75%. Am hoping for a price dip below Ksh 9.00 to undertake massive purchases although am already buying at prevailing prices.
2. KCB - At a projected dividend of Ksh 1.50 for 2011, the price of Ksh 15 represents a 10% dividend yield. Am buying at price dips below Ksh 15.
3. Williamson Tea - Having paid Ksh 15 dividend last year on an EPS of Ksh 97, the company made 91% of this money in 1st Half 2011 alone. Am projecting an EPS of Ksh 135 - 140 for the full year. The company is awash with cash and can comfortably give Ksh 25 - 30 as dividends for 2011. I'll be buying at any price below Ksh 250.
As prices continue to dip, my 10% principle brings more companies into focus.
Happy Hunting. Its 4 months since i adopted the above investment strategy and a good time to analyze the progress so far: 1. KenolKobil - Purchase Price: Ksh 9.30 ; Current price: Ksh 12. 75 Gain: Ksh 3.45 ; % gain = 37% 2. KCB - Purchase Price: Ksh 15 ; Current Price: Ksh 23.75 Gain: Ksh 8.75 ; % gain = 58.3% 3. Williamson Tea - Purchase Price: Ksh 186 ; Current Price: Ksh 232 Gain: Ksh 232 - 186 + 50 (Interim Dividend)= Ksh 96 ; % Gain = 51.6% The three picks have ourperformed the NSE index (NSE Index has risen about 18% since then). Am evaluating the three stocks in light of the prevailing market conditions, the capital gains etc and will soon post my next move concerning the three picks. Happy Hunting......... With such returns so far you can take a holiday for the rest of the year comfortably!!!!!!What your new strategy Its six months (Dec 2011 to May 2012)since i started this thread and since then, the scenario is as follows: 1. Kenol Kobil - A potential buy out at around Ksh 20 will be at least 120% return on investment. 2. K.C.B - Current price Ksh 23 after a dividend payment of Ksh 1.85. (Ksh 23 + 1.85 = Ksh 24.85). Thats a 65% return on investment. 3. Williamson Tea - At a price of Ksh 273 (Plus an interim dividend of Ksh 50) = Ksh 323 Thats a 73% gains and the end of year results are yet to be released where i expect a second dividend of at least Ksh 20. Happy Hunting. Seven months down the line and the scenario is as follows: 1. KK - (Purchase Price=Ksh 9.30; Dividend since purchase=Ksh 0.43). With the expected buy out, it seems to have found some price stability at Ksh 16. Am holding out for Puma cash which i anticipate will be > Ksh 20 (at least 25% more than if i cashed in now). 2. KCB - (Purchase Price=Ksh 15; Dividend since purchase= Ksh1.85). The price seems to have stabilized at Ksh 23-23.50. It is still undervalued; price target is Ksh 40 by April 2013. 3. Williamson Tea - (Purchase Price = Ksh 186; Dividend since purchase = Ksh 57.50). The 2nd half of their financial year was greatly affected by weather. However, they still managed to announce an EPS of Ksh 93 for year ended March 2012. Of importance is that for the last 3 years, the company has announced EPS in the range of Ksh 93-97 hence signaling a new high normal in profitability. Remove the biological assets (non-cash profit) component from the profit and this gives cash profit of Ksh 50-60 yearly. The tea prices are currently at new highs ($3.70-3.80 per kg) and with the precipitation experienced over the last few months, a possible continuation of this trend in profitability is expected. The company has given me a dividend yield of 31% within 7 months!! Am holding onto this one as the future looks bright for Williamson tea (and also my price target of Ksh 400 is yet to be met). Going forward: I am currently accumulating the following 2 counters: 1. Rea Vipingo - At Ksh 16 - 16.50; The company announced above normal EPS last year (Ksh 7.79) which the market assumed was a one off. However, half year March 2012 produced an EPS of 3.47 (Versus Ksh 2.56 for 2011) which indicated last year’s profits were the new normal and could be replicated easily this year. The diversification into horticulture seems to be paying off handsomely (they leased some land in athi river (130 acres) which they are growing baby corn, etc for export in addition to their horticulture project at Kibwezi (250 acres)). Last year, they raised their dividend from Ksh 0.80 to Ksh 1.10, and I project at least a dividend of Ksh 1.50 for the year ending September 2012 based on a Ksh 6-7 EPS for 2012. They hold enormous real estate in Kenya and Tanzania (In Kenya – Kibwezi: 22,215 acres; Vipingo (Near the exclusive Vipingo Ridge): 10,575 acres http://www.businessdaily.../-/wghxkwz/-/index.html
; and Tanzania: 36,660 acres) and are constantly increasing their sisal acreage. The diversification to horticulture is a sound strategy for this agribusiness company. This is a company to watch going forward. 2. KCB – The price of Ksh 23.25 - 23.50 is too enticing to ignore what with my price target of Ksh 40 within the next 10 Months and a dividend of Ksh 2 for 2012. Happy Hunting. KCB seems to have proven me right................I see a Ksh 30 on the near horizon and Ksh 40 within the next 10 months. Happy Hunting KCB should surpass the Ksh 30 barrier in the coming days.........Ksh 40 by May 2012 doesn't seem unrealistic now, does it? Rea Vipingo now in the Ksh 18 region.....Ksh 20 in the next two months. KK - The buy out seems to be dragging on very slowly..........the price of Ksh 14.20 forces one to hold. A target of Ksh 18 for some booking of profits. Williamson Tea - A price of Ksh 250 by end of December. Happy Hunting. It was a good year especially the capital gains from KCB, KK and dividends from Williamson Tea. On average, based on this 10 % dividend yield strategy, my net return on investment for the duration equal to one calender year is about 65% (Compared to a 30% ytd NSE 20 share index gain). Going forward, i have been liquidating most of my NSE holdings. Am of the opinion the current NSE rally in prices is a characteristic fattening before the slaughter. The March 2013 election is a reality that cannot be wished away. I forsee the index shedding at least 500 to 600 points to level at the 3500 - 3600 range before the March 2013 elections if political temperatures are kept low. Any rise in political temperatures in the next three months will surely erase the current 30% ytd gain. With so many variables hinged on our political process, i have decided to play by Young's Principle : Cash is King. I may well be wrong (that our market has divorced politics from its activities) ..........but i doubt it. The cow looks fat enough....can it get fatter or is it time for slaughter? Time will tell........ Happy Hunting. Good job. Impressive. Entry was point on, exit was too early. The NSE 20 went on to smash 5000 in 2013-14 which means @stocksmaster could have earned an extra 65% on his investment in less than one year. Life is short. Live passionately.
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Rank: Member Joined: 1/3/2011 Posts: 264 Location: Nairobi
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Hindsight is 20/20.
Stock master lived by these words:
"Bears make money, bulls make money, pigs get slaughtered" - he got in and out at prices that he deemed were appropriate and fair. Such conviction and confidence in this game is admirable.
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> 10 % Dividend Yield........my new yard stick in NSE stock picking
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