Symbol Name
JNJ Johnson & Johnson
KO The Coca-Cola Company Common
MDT Medtronic Inc.
MSFT Microsoft
WMT Wal-Mart Stores, Inc
This report was complied with the market live and the VIX at 19.36, the S&P at 1,206.70
Overall, the VIX has increased since our last report.
KO and WMT were presented on our last review dated 11/07/10.
NOTE:
Keep in mind that the near date on all these stocks shown today is 9 days away. For most of these stocks, the near dated expiration provided twice as much in the form of Days earning. However, there are another 27 days or 3x the period to the next date. Depending on your cost to trade, the expenses could overwhelm any incremental earnings. The example would be trading to the near date would require a ticket or transaction charge. If the option were to expire worthless, you would then enter into a trade for the next expiration date and incur another ticket charge. If the sum of the ticket charges are equal to or greater than the net additional basis points earned between the two dates you would actually lose money on an operational basis based on the cost of implementing the trade! It is these additional charges you need to me conscious of and we cannot advise you these matters only alert you to them, as each investors profile is different.
Dividend Monk presented the stocks reviewed on this report on Seeking Alpha in an article entitled "5 Dividend Stocks That Haven't Moved in a Decade".
Note that the Days Earning's and SSR category rankings are the same for all these stocks.
JNJ - Johnson & Johnson - JNJ is number 5 of 5, the least attractive in the sorts for Day's earning's and SSR for today's stocks. Even at the bottom, its profile is good. The Day's earnings for the far date have been adjusted for dividend payment. Our method for accounting for dividends results in a 2.3 bps adjustment. If you are sensitive to trading costs, the far date should be sufficient provided the dividend is earned. The RVI's are high but not egregious.
KO - The Coca-Cola Company - The near days without the dividend provided 7.4 bps/day income while the further dates earn the dividend the impact is not all that helpful. If trading costs are not an issue look to roll the expiry dates, otherwise go with the December $62.50's.
MDT - Medtronic, Inc - MDT is new to our database. Its profile is attractive based on our model and the group shown in this report and overall has a low P/E, good dividend yield and low RVI's.
MSFT - Microsoft - #2 in today's group and a stock we like. We have previously written about MSFT in glowing terms. It has all the elements we like and continues to provide an attractive profile for our strategy. A dividend can be earned at either date, RVI's are mid range.
WMT - Wal-Mart Stores, Inc - WMT is mid range in this group. We like the stock but be cautious of the dividend impact as it pays (on 12/08) into the far date.
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As with everything we post, we may or may not have the stock and/or strategy in place in any one of our portfolios or may add it at any time. We do not make any buy or sell recommendations. We provide basic analytical research, some short commentary of the results and encourage you to do your own thorough due diligence prior to any purchase or sale.
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