Observations and Sample of Recent Trades: COTY, ENB, ENY, FHB, GPT, IDV, LXP, MRK, NVS, ONB, SNR, VNQ

Economy:

CPI increased .5% on a seasonally adjusted basis in January. For the twelve month period ending in January, CPI rose 2.1%. Core CPI rose .3% in January and was up 1.8% Y-O-Y. 

Consumer Price Index Summary

Table 2. Consumer Price Index for All Urban Consumers (CPI-U): U. S. city average, by detailed expenditure category (on a non-seasonally adjusted basis, the government claims that health insurance cost was up .3% over the past year)

CPI has market locking in March rate hike and moving toward 4 Fed increases this year - MarketWatch

Total household debt hit an all time record last quarter at $13.15 trillion. Total US household debt soars to record above $13 trillion: CNBC

Household Debt Jumps as 2017 Marks the Fifth Consecutive Year Of Positive Annual Growth Since Post-Recession Deleveraging - FEDERAL RESERVE BANK of NEW YORK

U.S. retail sales slump in January, and December’s initial gain was erased - MarketWatch

Retail Sales-Census Bureau.pdf

One danger is that rising consumer debt levels and interest costs will combine to slow down consumer spending. Consumer confidence could be sapped by continued volatility in equity markets with a strong overall downside bias.

++++++++++

Market Commentary and Markets:

Investors cut bond market allocation to 20-year low amid fears of a 'crash': CNBC ("reduced their bond portfolios to a net 69 percent underweight, the lowest since the survey began two decades ago. The survey polled 196 panelists with $575 billion in assets under management.")

Hedge Funds' Biggest Short in Bonds Faces Make-or-Break Moment - Bloomberg

Record $23 Billion Flees World's Largest ETF - Bloomberg (2/11/18)

Number of fund managers who see the economy in its late cycle is at a 10-year high - MarketWatch

US economy is an 'accident waiting to happen,' says Yale economist Stephen Roach: CNBC

Junk bond chart points to a looming economic slowdown: CNBC 

Fannie Mae to turn to taxpayers after $6.5 billion loss - MarketWatch

++++++++++

Portfolio Management:

The stronger than expected CPI increase for January caused a pop in interest rates yesterday. The FED will increase the FF rate by .25% in March.

Continued strength in the economy through 2018 will likely result in at least a .75% increase in FF rate this year. The ten year treasury yield is likely to bust through 3.04% soon, which would be the first higher high yield since 1981 using a long term 10 year treasury chart.

My portfolio weighting in fixed income remains concentrated in 2018-2019 maturities, as I expect a persistent uptrend in interest rates across the maturity spectrum in 2018. While those mostly two bond or CD purchases will decline some in value with a continued uptrend in short term rates, the decline will not last long given the short term maturities.

I will continue to lower interest rate risk through a ladder strategy, where I have several bonds and CDs mature virtually every week. A one year CD bought last year in February would generally have a 1% or 1.1% coupon while the current 1 year maturities are in the 1.9% to 2% range. 

I am down to owning only 1 equity preferred stock, a 50 share position in BPFHP which went ex dividend for its quarterly distribution yesterday. Boston Private Financial Holdings Inc. 6.95% Non-Cumulative Preferred Series D (BPFHP) I am still anticipating that this dividend will be the next to last one given the issuer's right to call on or after 6/15/18: Prospectus. I still own a few Canadian reset equity preferred stocks. 

While fixed coupon equity preferred stocks have fallen some in price, they are not close to the low prices reached when the ten year treasury hit 3.04% on 12/31/13. I am monitoring prices for fixed coupon exchange traded bonds and preferred stocks more closely now for major gaps down in price.

The rising interest rate scenario makes regional banks more attractive and bond like common stocks less so. Regional banks are in general major beneficiaries of the corporate tax reduction and will further benefit from the deregulation push that will likely involve major modifications to the Dodd-Frank law.

I still have an abundance of free commission trades, but all of them expire in August. I have decided to use all of them making small lot purchases and averaging down when and if the price continues to decline.


+++++++++

Trump as the Number One Fake News Originator:

Donald will never cease to call the free press the Fake News Media, though he has not recently specifically called the press "the enemy of the people".

Possibly someone told Donald that Joseph Goebbels, Lenin and Stalin made that phrase popular among dictators and want to be dictators like Trump. History of Trump's phrase an 'enemy of the people' - Business Insider

Trump's most recent attack on the free press for publishing information that he does not like: 

The overt and underlying message that is repeated by Trump over and over again is that only Donald needs to be consulted for the truth. The Fake News Media, which includes virtually all sources of information, can be ignored altogether. The GOP has been indoctrinating the faithful on that message starting with the Nixon administration and it has been a wildly successful strategy for them, as was their Southern strategy. 

The Fake News originates from Donald and his extremely limited approved information sources which includes Fox and Friends and Sean Hannity. 

The following is just one recent example of Trump's Fake News.    

The FBI recently released the results of its comprehensive investigation into the death of a border patrol employee Rogelio Martinez.

This is what the FBI found:

"To date none of the more than 650 interviews completed, locations searched, or evidence collected and analyzed have produced evidence that would support the existence of a scuffle, altercation, or attack on Nov. 18, 2017" 

Trump Pledged Justice For Border Patrol Agent But No Evidence Of Homicide Found-NPR

F.B.I. Finds No Evidence of Attack in Death of Border Agent - The New York Times

FBI: No evidence of attack in Border Patrol agent's death - ABC News

Border Patrol agent died in fall, according to memo contradicting Trump’s claim of attack - The Washington Post ("Kevin McAleenan, the acting commissioner of the Border Patrol, told his staff this week that the men fell into a nine-foot-deep culvert on a pitch-black night.")

Shortly after the incident, Donald tweeted the following comment: 

The surviving agent, who does not remember anything now, told the dispatcher that "We ran into a culvert". I do not know whether he was driving. 

The conclusion that illegal immigrants caused the death was reached by Donald, Ted Cruz, the Texas Governor, Sean Hannity and similar ilk based on no evidence. Instead, their ideology dictated their non-factually based conclusions which is their standard modus operandi.  

Donald will frequently use the death of some unfortunate soul to lobby for the wall. It is totally irrelevant to him whether the death would have occurred with or without the wall in place. It is also repulsive to non-Trump supporters.  

+++

The Trump appointed FBI Director testified on Tuesday that the FBI submitted a partial report on Rob Porter to the White House in March 2017 and completed its investigation in July 2017. 

The Trump WH claims that they were first contacted in the 2017 summer and the investigation was never completed. The WH knew that the FBI would not give Porter a security clearance, yet continued to allow him access to classified material. 

FBI's Christopher Wray contradicts White House's account of Rob Porter’s security clearance-The Washington Post; FBI director contradicts White House's Porter timeline-CNN

Porter was up for promotion despite abuse allegations - CNN 

So Trump et. al. are lying again. A fair conclusion to be drawn is that Trump et. al. were not concerned about the abuse allegations until they were revealed by news reports; and even then their first instinct was to rally around Porter which is what they in fact did initially. 

Trump did say yesterday that he was against spousal abuse. That was to dispel the rumor that he was for it. 

+++ 

Observations show sea levels rising-climate change is accelerating it 

Scott Pruitt suggests climate change could benefit humans 

At this point in history, it would be fair to assume now that all republican politicians and probably over 70% of republican tribe members are in fact climate change deniers and will never accept the science that contradicts their opinions on this matter until the world is well past the point of no return.  

Trump Wants To Give Ryan Zinke The Power To Approve Pipelines In National Parks 

Trump budget would boost defense funding, slash domestic spending (big boosts for defenses, slashes in Medicare, Medicaid, food stamps, Public Broadcasting and other social programs); 

Trump's budget at least provides a clear statement of what the GOP really wants to do. 

Trump still unconvinced of 2016 Russian election meddling-CNN 

House Russia investigation has 'abundance' of evidence against Trump, says top Democrat

Trump's budget would end student loan forgiveness program: CNBC

Trump’s Longtime Lawyer Says He Paid Stormy Daniels Out of His Own Pocket (So do I believe that Cohen paid Stormy $130K from his bank account and was not reimbursed somehow by Trump? If that is true, did he make what amounts to an undisclosed campaign contribution to Trump's campaign?) The interesting piece of information from Cohen is his statement that the neither the Trump campaign nor the Trump organization reimbursed him. What about Donald? Common Cause has initiated a lawsuit alleging a campaign finance violation in failing to report this $130K payment. 

Common Cause-Trump Attorney Appears to Have Made Illegal Contribution to Trump Campaign With Hush Money Payment to Stormy Daniels

Now, none of that matters to the evangelicals who support Donald no matter what he does.  

+++++++

1. Small Ball-REGIONAL BANK BASKET STRATEGY:

A. Added 10 FHB at $28.4 and 5 shares at $27.7-Used Fidelity Commission Free Trade:

  

Quote: First Hawaiian Inc. (FHB)

These were automatic purchases after the price fell below $28.5 and then $28. The next purchase would be a 10 share lot between $26-$27.

I mentioned the $28.5 target level for another 10 share purchase when I discussed buying the first 10 share lot here: Item # 1.A. Bought 50 First Hawaiian at $29 and 10 at $29.11-Used Commission Free Trades (12/21/2017 Post)

I now own 25 shares in this account, with an average cost per share of $28.54 and will buy up to 50 shares.

I also own 50 shares in my Schwab account.

I sold 100 shares as a short trade in my Vanguard account at $30.11.

I am not going to repeat the discussion that can be found in the above linked post. Instead, I will just summarize the 4th quarter earnings report and the recent dividend increase.

Dividend: FHB recently raised its quarterly rate to $.24 per share from $.22. 

Dividend Yield: The yield is about 3.36% at a $28.54 TC per share. 

Last Earnings Report: 

"Core net income for the quarter ended December 31, 2017 and the full year 2017, which primarily excludes the impact of a one-time charge to provision for income taxes of $47.6 million due to the revaluation of certain tax-related assets at the projected lower corporate tax rate resulting from the Tax Cuts and Jobs Act, was $59.2 million, or $0.42 per diluted share, and $230.4 million, or $1.65 per diluted share, respectively."

NIM 2.99% (low)

Efficiency Ratio 47.5% (excellent)

Charge Off Ratio .17% (good)

NPA Ratio .08% (excellent) 

ROA (core) 1.16% (okay)

ROE (core) 9.13% (below average)

ROE Tangible Equity (core): 14.9% (fine)

Total Capital Ratio: 13.5% (okay)

Since FHB had a deferred tax asset that had to be revalued due to the lower corporate tax rate, GAAP earnings and other financial metrics  were distorted by a $47.6 non-cash charge to earnings: 

"The provision for taxes in the fourth quarter of 2017 included a $47.6 million charge due to the revaluation of certain tax-related assets at the projected lower corporate tax rate resulting from the Tax Cuts and Jobs Act.  Excluding the one-time charge, the effective tax rate for the fourth quarter of 2017 was 37.1% compared with 37.7% in the previous quarter and 39.8% percent in the same quarter last year.  Excluding the one-time charge in the fourth quarter of 2017, the effective tax rate for the full year 2017 was 37.2% compared with 38.1% in 2016." (emphasis added)

FHB will be a beneficiary of the lower corporate federal income tax rate. 

First Hawaiian, Inc. Reports Fourth Quarter and Full Year 2017 Financial Results and Increases Dividend by 9.1% 

JPM downgraded the stock to neutral after this report. I do not have access to that report. FHB has anemic loan growth and a below average NIM, but I would focus more on the positives including the low charge-offs and non-performing loans, the significant increases in net income due to the lower corporate tax rate, and the excellent efficiency ratio. I recognize the problems too.  

Closing Price Yesterday (2/14/18):  FHB $28.35 +$0.20 0.71% 

B. Bought 10 ONB at $16.75:

QUOTE: Old National Bancorp (ONB)

ONB is the holding company for Old National Bank, headquartered in Evansville, Indiana close to a casino where I like to gamble.

Old National has grown in geographic footprint through a series of acquisitions and now has 191 branches in Indiana, Kentucky, Michigan, Wisconsin and Minnesota. 

Old National Bank Mergers and Acquisitions

DIVIDEND: Quarterly at $.13

Old National Announces Quarterly Cash Dividend (ex date 2/28/18)

Dividend Yield at $16.75 TC = 3.1%

Last Discussed:

Item 2.A. Eliminated ONB-Sold 50 Shares at $18.55 (2/27/17 Post)(profit snapshot=$312.97)

Most Recent Purchase Discussions: 

Item # 2. Averaged Down: Bought 50 ONB at $12.25-Update For Regional Bank Basket As Of 1/19/16 - South Gent | Seeking Alpha

Item # 2. Bought 50 ONB at $13.1: Update For Regional Bank Basket Strategy As Of 1/6/16 - South Gent | Seeking Alpha

Item # 5. Bought in Roth IRA: 50 ONB at $11.38:Update For Regional Bank Basket Strategy As Of 1/28/16 - South Gent | Seeking Alpha

Trading Profits to Date: $757.11

Last Earnings Report: 

Old National’s 4th quarter includes strong commercial loan growth and another successful partnership  

ONB had to record a non-cash charge of $39.3M relating to the revaluation of its deferred tax asset.  

"Also included in the 4^thquarter were the following pre-tax charges: $11.9 million for merger and integration, $3.0 million for branch consolidations, $1.6 million in severance, $1.3 million for Foundation funding and $0.7 million for a client experience improvement initiative." 

ONB recently completed the acquisition of Anchor Bancorp.   

On a GAAP basis, E.P.S. for the 4th quarter was ($.13). Ex-items, E.P.S. was reported at $.22 per share.  The extraordinary items make the ROA, ROE, E.P.S. and efficiency ratio numbers for the quarter worthless. 

The charge-off ratio was excellent at .03%. The NPL ratio was too high at 1.3%. NIM was reported at 3.47%.

The capital ratios are pedestrian. 

Overall, I have a slightly unfavorable opinion of this bank which explains the 10 share purchase. I want lower prices before buying more. 

The most recent acquisition was Anchor Bancorp. 

Anchor Acquisition Announcement:  Old National partners with Anchor Bank, expands into Minnesota’s Twin Cities (with "$2.1 billion in total assets, $1.6 billion in total loans, $1.7 billion in deposits, and $164 million in common shareholder’s equity as of June 30, 2017, Anchor is a bank holding company with Anchor Bank, N.A. (“Anchor Bank”) as its wholly-owned subsidiary. Founded in 1967 and with 18 total branches, Anchor Bank is one of the largest community banks headquartered in the Twin Cities, and also serves Mankato, Minnesota. Anchor Bank has no affiliation with the former AnchorBank in Madison, Wisconsin, which Old National acquired in 2016.")

Historical Annual Tax Rates: ONB will be a beneficiary of lower federal tax rates: 

Closing Price Yesterday:  ONB $17.55 +$0.35 +2.03% 

2. SMALL BALL- Equity REIT Common and Preferred Stock Basket Strategy:

REITs are in a major downtrend as interest rates, so I am just nibbling for now.  

A. Small Lot LXP "Buying Program" Using Commission Free Trades in Fidelity Taxable Account: 

Quote:  Lexington Realty Trust  (LXP)

As shown in this snapshot of small ball buys, LXP is one of the equity REITs whose stock has been hammered recently:

I will continue to add in small lots, using commission free trades, but only at lower prices. I am set up to reinvest the dividend now which I did not do for the few shares owned at the last ex dividend date which was on 12/28/17.  


Average Cost Per Share = $9.07

Dividend: Quarterly at $.1775 ($.71 annually)

Dividend Yield at $9.07 AC = 7.828%

In Item # 1 (1/4/18 Post), I discussed this REIT in more detail.

In 2017 the dividends paid last year were supported in material part by a return of capital. The ROC component is not taxable as a dividend but does reduce the cost basis.

Lexington Realty Trust Final Dividend Allocation for 2017

B. Added 10 SNR at $6.9-Used Commission Free Trade:

Quote: New Senior Investment Group (SNR)
Website: New Senior Investment Group
Property Map | New Senior Investment Group
2017 Third Quarter Investor Presentation.PDF

In this account, my average cost per share is currently at $8.23 per share.

I will sell the 50 share lot bought at $8.79 when and if the prices goes above $9.

New Senior Announces $296 Million of Asset Sales Under Contract (10/5/17 Press Release)  

"On November 1, 2017, the Company sold nine AL/MC properties in the Managed Properties segment for a purchase price of $109,500 and expects to recognize a gain on sale of approximately $7,000. In connection with this sale, the Company repaid approximately $79,000 of debt." Page 18 10-Q for the Q-E 9/30/17 under "Subsequent Events"

I have not seen any press release announcing the sale of $186M of six triple net leased properties that was included in that $296M asset sale announcement. Those properties are leased to Life Care Services who is listed as the buyer. New Senior to Sell Holiday, LCS Properties for $296 Million - Senior Housing News

2017 Third Quarter Results

Closing Price Day of Trade (2/9/18): SNR $6.98 -$0.05 -0.71%

Last Discussed: Item 2.A. Added 20 SNR at $7.65 (12/26/17 Post)

Last Substantive Discussion: Item 4.A. Bought 50 SNR at $8.2k (11/9/17 Post)

Links to Sell Discussions:

Item # 4.A. Sold 100 SNR at $10.44 (8/7/17 Post)

Item # 6 Sold 100 SNR at $11.76 and Item # 7 Sold 50 SNR at $11.85: Update For Equity REIT Basket Strategy As Of 7/28/16 - South Gent | Seeking Alpha

South Gent's Comment Blog # 2 (noting a 50 share sell transaction at $12.3 on 9/16/16 in a Vanguard Roth IRA)

Net Realized Gains to Date: $468.18 (very hard to generate profits)

Dividend: Quarterly at $.26, likely to be cut soon

Assuming no cut, which is not going to happen, the dividend yield at $6.9 would be about 15.07%.

The current dividend is simply not sustainable. If the dividend is maintained at $.26, I would not regard that circumstance as a positive one since it would be most imprudent. 

The next earnings release date is before the market opens on 2/23/18. New Senior Announces Fourth Quarter and Full Year 2017 Earnings Release Date and Conference Call I anticipate that a dividend cut will be announced at that time. My best guess is a cut to $.15 or $.16 per share. At a $.6 annual dividend, down from the current $1.04, the yield at $6.9 would be about 8.7% which is at least comfortably below AFFO.

Last Ex-Dividend Date: 12/7/17

Tax Classification of Dividend Payments:

The entire dividend paid in 2017 was classified as a return of capital: New Senior Announces Tax Treatment of 2017 Dividends The cost basis for shares owned in a taxable account will be reduced by the applicable ROC amount.

For 100 shares owned for the entire year, for example, the total dividend was $1.04 per share or $104. The cost basis would be lowered by $1.04 per share and no tax would apply to the $104 received in dividends. When the shares are sold, the profit will be greater, or the loss lower, than it otherwise would have been without the ROC adjustment to the cost basis.  

C. ADDED 5 GPT at $22.61-Used Commission Free Trade: 

Quote: Gramercy Property Trust  (GPT)

This brings me up to 35 shares with an average cost per share of $24.25.

The dividend yield at a TC of $24.25 is about 6.19%, assuming a continuation of the current quarterly dividend of $.375 per share ($1.5 annually)

D. Added 5 VNQ at $72.4-Commission Free ETF for Vanguard Customers:

Quote: Vanguard Real Estate ETF Overview

Sponsor's Webpage: Vanguard (.12% expense ratio)

This brings me up to 30 shares, all bought in 5 share lots while averaging down from my first five lot purchase made on 1/25/18.

Fidelity has a similar REIT ETF that can be bought commission free by their customers provided the shares are held for at least 30 days. FREL | ETF Snapshot - Fidelity

VNQ pays quarterly dividends. The VNQ dividend will be assigned the tax characteristics of the dividends paid by the owned stocks which will generally include a return of capital ("ROC") component. That part of VNQ's dividend classified as ROC will reduce the cost basis of VNQ's shares:

"Vanguard REIT Index Fund pays quarterly distributions consisting of dividend income, return of capital, and capital gains. However, the tax characteristics of these distributions cannot be determined until after the end of the year since the REITs in which the fund invests do not designate the composition (i.e., dividend income, return of capital, and capital gains) of their payments until the new calendar year." Vanguard-REIT Index Fund disclaimer

2017 Total Dividend = $3.5136

The Vanguard website does not currently have the tax classifications of those dividends.

If I just took the 2017 dividend and my $72.4 cost per share from this last 5 share purchase, the dividend yield based on last year's total dividend amount is about 4.853% which includes the ROC component.

3. Short Term Bond/CD Ladder Basket Strategy:

A. Bought 1 Caterpillar Financial Services 1.9% SU Bond Maturing on 3/22/19: 

FINRA Page: Bond Detail (prospectus linked)

Issuer: Wholly Owned Subsidiary of Caterpillar Inc., which does not guarantee the bonds

Credit Ratings: 

Bought at a Total Cost of 99.817

YTM at TC Then at 2.059%

Current Yield at TC = 1.9035%

B. Bought 1 McDonalds 2.2% SU Bond Maturing on 5/26/2020:

As time moves closer to maturity and assuming the price falls some, I will probably use proceeds from maturing issues to buy more. At Interactive Brokers and Fidelity, I pay $1 per bond so there is no discounted commission for buying more than 1 bond. Buying 5 bonds one-at-a-time results in the same brokerage commission as buying 5 bonds in one trade. 

FINRA Page: Bond Detail (prospectus linked)

Issuer: McDonald's Corp.  (MCD)
MCD Analyst Estimates

Credit Ratings:

Bought at a Total Cost of 99.641
YTM at TC Then at 2.358%
Current Yield at TC = 2.2079%

I did previously sell 2 of these bonds at 100.918. Item 6.B. (9/21/17 Post) Observations and Sample of Recent Trades: ORKLY The YTM at that price was 1.838%.

I will be looking to add  another 1 bond lot at lower total cost number than 99.641, preferably closer to 99. 

C. Bought 1 Wells Fargo 2.3% CD (monthly interest payments) Maturing on 1/31/20:

D. Bought 1 Citigroup 2.45% SU Bond Maturing on 1/20/20-A Roth IRA Account:

FINRA Page: Bond Detail (prospectus linked)

Issuer: Citigroup Inc. (C)
C Analyst Estimates
Citigroup Reports Fourth Quarter 2017 Financial Results

Credit Ratings:

Bought at a Total Cost of 99.996
YTM & Current Yield Effectively Coupon Yield of 2.45% at Total Cost

E. BOUGHT 2 JP Morgan 2.2% SU Bonds Maturing on 10/22/19:

FINRA Page: Bond Detail

Issuer: JPMorgan Chase & Co. (JPM)
JPM Analyst Estimates

Credit Ratings:

Bought at a Total Cost of 99.793
YTM at TC Then at 2.321%
Current Yield at TC = 2.2046%

F. Bought 2 American International Group 2.3% SU Bonds Maturing on 7/16/19:

Finra Page: Bond Detail (prospectus linked)

Issuer: American International Group Inc. (AIG)
AIG Analyst Estimates

Credit Ratings:

Bought at a Total Cost of 99.851
YTM at TC Then at 2.403%
Current Yield at TC = 2.3034%

G. Bought 1 Dow Chemical 2.5% SU Bond Maturing on 10/15/19:

Dow Chemical is now part of DowDuPont Inc. (DWDP ).

Finra Page: Bond Detail (prospectus linked)

Credit Ratings:

Bought at a Total Cost of 99.975
YTM at TC Then at 2.514%
Current Yield at 2.5006%

H. Bought 2 Live Oak Banking 1.65% CDs (monthly interest payments) Maturing on 8/9/18:

Holding Company: Live Oak Bancshares Inc. (LOB) - MarketWatch
LOB Analyst Estimates

I. Bought 2 Bank of India 1.45% CDs Maturing on 4/3/18 (2 month CDs):

4. Sold 51+ IDV Shares at $33.48 (commission free ETF at Fidelity):

Quote: iShares International Select Dividend ETF (IDV)

Profit Snapshot: +$242.33

Rationale: Profit taking and some concern that the USD's decline may reverse. IDV is a USD priced ETF that owns foreign stocks.  

5. Ingesting Microscopic Crumbs Basket Strategy Using Commission Free Trades:

A. Bought 10 COTY at $16.92:

Quote: Coty Inc. Cl A  (COTY)

Closing Price Yesterday (2/14/18):  COTY $21.25 $0.69 +3.36%

I just sold 20 shares at Stocks, Bonds & Politics: Item 1.D. Sold 20 COTY at  $20.89 (1/28/18 POST)(profit snapshot= $80.61)

Maybe I could have splurged and bought back 20 shares rather than just 10 at $16.92, but Left Brain is a stickler for target prices. The next purchase had to be below $16.78. 

Last Discussed: Item # Bought 10 COTY at $16.94 and 10 at $16.78  (11/30/17 Post)

After I bought this lot, COTY reported earnings for its second fiscal quarter ending 12/31/17 and the stock popped in response.

Last Earnings Report: Coty Inc. Reports Second Quarter Fiscal 2018 Results

B. Bought Back 10 MRK at $54.53:

Quote: Merck & Co. Inc. (MRK)

I just sold 10 shares at $61.2: Item 1.C. Sold 10 MRK at $61.2 (1/28/18 Post)

Last Discussed: Item # 2.A. Bought 10 MRK at $54.29 (12/7/17 POST)

Prior 2017 Discussion: ITEM # 2.B. Sold 113 MRK at $65.28 (2/19/17 Post)(profit snapshot= +$741.19)

Dividend: Quarterly at $.48 per share

Merck Announces Second-Quarter 2018 Dividend

Dividend Yield at a $54.53 TC per share = 3.52%

Recent Earnings Report: Merck Announces Fourth-Quarter and Full-Year 2017 Financial Results

Merck's growth remains a Keytruda story.

Main Products:

Pipeline Developments:

Recent News Releases:

FDA Approves SGLT2 Inhibitor STEGLATRO™ (ertugliflozin) and Fixed-Dose Combination STEGLUJAN™ (ertugliflozin and sitagliptin) for Adults with Type 2 Diabetes (12/22/17)

Merck’s KEYTRUDA(R) (pembrolizumab) Significantly Improved Overall Survival and Progression-Free Survival as First-Line Treatment in Combination with Pemetrexed and Platinum Chemotherapy for Patients with Metastatic Nonsquamous Non-Small Cell Lung Cancer (1/16/18)

LYNPARZA® (olaparib) Receives Approval in Japan for the Treatment of Advanced Ovarian Cancer (1/19/18)

Merck Receives Positive CHMP Opinion for PREVYMIS™ (letermovir) in the European Union (11/13/17)

Merck Receives FDA Approval of PREVYMIS™ (letermovir) for Prevention of Cytomegalovirus (CMV) Infection and Disease in Adult Allogeneic Stem Cell Transplant Patients (11.9.17 Post)

AstraZeneca Deal: AstraZeneca and Merck Establish Strategic Oncology Collaboration

At the time of purchase, Morningstar had a $65 fair value estimate and a 4 star rating. Credit Suisse had a $66 target price and an outperform rating. Both of those reports are available to Charles Schwab customers.  S & P had a 3 star rating and a $60 twelve month price target. I am likely to be a seller in the $60 to $65 range based on what is known to me now. That range can go up or down based on future developments.

Closing Price Yesterday (2/14/18): MRK $54.90 0.00 0.00%

C. Bought 10 NVS at $85 and 2 at $82.9  -Used Commission Free Trade:

Quote: Novartis AG ADR (NVS)

I recently sold 30 shares at $93.85. Item 2.A. Sold 30 NVS at $93.85 (2/3/18 Post) I am just buying back those shares and taking my time. 

I discussed the last earnings report in that recent post. 

What's Expected of Novartis's Core Operating Income in 2018? - Market Realist

Annual Ex Dividend Date: 3/6/18

My larger NVS position, close to 105 shares, is held in another account. 

Closing Price Yesterday: NVS $85.52 +$1.92 +2.30%

CHF / USD Currency Chart. Swiss Franc to US Dollar Rates

D. Bought 5 ENB at $33.36-Used Commission Free Trade:

Quote: Enbridge Inc. (ENB)

This brings me up to 45+ shares:

Average Cost Per Share: $35.82

Quarterly Ex Dividend Date: 2/14/18

Enbridge is a Canadian corporation. Canada will withhold a 15% dividend tax:

The amount of the dividend will also depend on the CAD/USD conversion rate. The current quarterly rate is C$.671 per share. Enbridge Dividend History and Securities Info - Enbridge Inc.

Convert CAD/USD. Canada Dollar to United States Dollar

Assume that the CAD/USD is .79. The C$.671 would convert into US$.53. Assuming the same exchange rate for all four quarterly dividends, the dividend yield at a total cost of US$35.82 would be about 5.92% before the withholding tax. 

CAD / USD Currency Chart. Canadian Dollar to US Dollar Rates

At a 1 CAD to 1 USD exchange rate, the quarterly dividend amount would increase to US$.671 and the yield using the same assumptions would then be 7.483%. 

So the owner of ENB would want the CAD/USD to rise after purchase, primarily because of the favorable impact on ENB's price compared to the ordinary shares priced in CADs and secondarily because of the increased USD value of the Canadian Dollar dividend payment. 

I am reinvesting the dividend.

My next add will be another 5 share at <$32.5

I will generally eliminate or pare an ENB position at >$39.

Sell Discussion: Item # 3 Sold 50 ENB at $39.03 (12/21/17 Post)

I also briefly mentioned selling my highest cost 10 share lot, using a commission free trade, at $40.14 here.

Most Recent Substantive Purchase Discussion: Item 3. Added 20 ENB at $36.5 (11/17/17 Post)

E. Added 10 ENY at $7.57-Used Commission Free Trade:

With the recent decline in energy prices, this ETF declined quickly from my last purchase at  $8.27 just a few days ago. Item # 1.A. (2/1/18 Post) 

Guggenheim Canadian Energy Income ETF
Guggenheim Canadian Energy Income ETF
All Holdings

It would be fair to say, without fear of contradiction or dispute, that ENY is not working at the moment. 

Yesterday's Closing Price (2/14/18): ENY $7.69 +$0.10 +1.33%

CAD / USD Currency Chart. Canadian Dollar to US Dollar Rates

Disclaimer: I am not a financial advisor but simply an individual investor who has been managing my own money since I was a teenager. In this post, I am acting solely as a financial journalist focusing on my own investments. The information contained in this post is not intended to be a complete description or summary of all available data relevant to making an investment decision. Instead, I am merely expressing some of the reasons underlying the purchase or sell of securities. Nothing in this post is intended to constitute investment or legal advice or a recommendation to buy or to sell. All investors need to perform their own due diligence before making any financial decision which requires at a minimum reading original source material available at the SEC and elsewhere. A failure to perform due diligence only increases what I call "error creep". Stocks, Bonds & Politics: ERROR CREEP and the INVESTING PROCESS Each investor needs to assess a potential investment taking into account their personal risk tolerances, goals and situational risks. I can only make that kind of assessment for myself and family members.