BHB, CC, CSCO, EBIX, ERC, FAX, HBNC, HCMLY, KC, KREF, LMT, NOMD, RCII, REYN, SKT, SNY, WEC

Economy: 

U.S. Minimum Wages Have Already Jumped—With Minimal Costs to Business | Barron's

U.S. budget deficits to be near or above $1 trillion annually over next decade, Congressional Budget Office says - MarketWatch

U.S. retail sales January 2021: +5.3% vs. consensus at 1.2% 

New unemployment claims for the W/E 2/13/21 = 861,000 vs consensus at 773K, and prior week was revised up to 848K from previously reported 793K. 

‘This is not inflation’: Economist says expectations are unanchored from reality

Household debt rises to $14.6 trillion due to record-breaking rise in mortgage loans This number is compiled by N.Y. Fed. Household Debt and Credit Report - FEDERAL RESERVE BANK of NEW YORK

Millions of jobs aren’t coming back after the pandemic ends, spurring a need for retraining - The Washington Post

 

++++

Markets and Market Commentary: 

A small-cap stock-market breakout is leaving the S&P 500 in the dust — here’s what it means for the rally - MarketWatch

We were ‘dangerously close’ to collapse of ‘entire system,’ says Interactive Brokers founder ahead of GameStop hearing - MarketWatch

Rise in Treasury yields prompts speculation of a ‘tantrum’ for markets

Higher Interest Rates Don’t Trouble the Stock Market—at Least Not Yet | Barron's

Regional Banks: This sub sector of financial stocks is outperforming the S & P 500 this year by a significant amount. 

YTD through 2/19/21: 

SPDR® S&P 500 ETF Trust (SPY) Performance = +4.32%

SPDR® S&P Regional Banking ETF (KRE) Performance = +22.83%

My largest sector exposure for individual stocks is to regional banks which I have been paring. This is a list of my holdings and dividend yields at last Friday's closing prices:

My dividend yield will be substantially higher than what is shown above due to my original purchase price being lower and paring of my highest cost lots. 

Yahoo Finance does not show the 12 month trailing yield of Truist (TFC), which is currently 3.13%.  

Earnings Reports Owned Stocks: 

Bank of Butterfield (NTB) Reports Fourth Quarter and Full Year 2020 Results (E.P.S. of $.84 with core E.P.S. at $.86; consensus at $.73 according to Fidelity; declares regular quarterly dividend of $.44; Board approves stock buyback of up to 2 million shares; 2020 core E.P.S. at $3.04; 4th quarter: ROE at 16.9%, ROTE = 19%; core efficiency = 65.6%; NIM = 2.25%; NPA Ratio = .6%; Coverage Ratio = 47%; total capital ratio = 19.8%; tangible book value per share = $19.88) 

Black Hills Corp. (BKH) Reports Strong 2020 Fourth Quarter and Full Year Results and Provides Five-year Growth Outlook (4th Q. E.P.S. reported at $1.23, both GAAP and non-GAAP and up from $1.13 in the 2019 4th Q.; consensus at $1.146 according to Fidelity; boosts 2021 E.P.S. guidance to $3.8 to $4; introduces 2022 E.P.S. guidance of $3.95 to $4.14; 2020 E.P.S. at $3.65 GAAP) 

Brookfield Asset Management (BAM) Reports Record Financial Results and Announces a Dividend Increase of 8% (FFO of $1.34 per share, up from $.75 in the 2019 4th quarter; 2020 FFO per share = $3.27, up from $2.71 in 2019)

The Chemours Company (CC) Reports Strong Fourth Quarter and Full Year 2020 Results with Solid Momentum Across Core Markets (GAAP E.P.S. $.11; adjusted E.P.S. at $.61; consensus at $.411 according to fidelity; free cash flow at $300M)

Duke Energy (DUK) Reports 4th Quarter and 2020 Results (adjusted E.P.S. of $1.03 in line; reaffirmed 2021 adjusted E.P.S. guidance of $5 to $5.30 and long term adjusted E.P.S. growth of 5% to 7% through 2025 off 2021 mid-point of $5.15)

Flowers Foods, Inc. (FLO) Reports Fourth Quarter And Full Year 2020 Results (E.P.S. = $.26, adjusted to $.28; revenues up 11.5% but additional week in quarter accounted for 8.2% of that gain; consensus E.P.S. at $.24)

Gladstone Commercial Corporation (GOOD) Reports Results for the Fourth Quarter and Year Ended December 31, 2019 (Core FFO at $.40 per share, quarterly dividends at $.375 paid in monthly installments; properties -118; square feet leased = 97%)

Kellogg (K) Reports Results for the F/Q Ending 1/2/21 (E.P.S. at $.59; Adjusted E.P.S. at $.86; consensus at $.888 non-GAAP according to Fidelity; organic net sales up 2.5% in quarter and 6% for the F/Y ending 1/2/21)

Kraft Heinz (KHC) Reports Fourth Quarter and Full Year 2020 Results (E.P.S. of $.84, adjusted to $.80; consensus at $.736 according to Fidelity probably comparable to $.80 adjusted number; organic net sales up 6%; company declared regular quarterly dividend of $.40 per share; and see Kraft Heinz Announces Agreement to Sell Several Brands, including Planters Nuts, to Hormel Foods for $3.35B)

Manulife (MFC) reports 2020 net income of C$5.9 billion, core earnings of C$5.5 billion, APE sales of C$5.6 billion, and strong Global WAM net inflows of C$8.9 billion (4th Q E.P.S. at C$.89 with core at C$.74; declared regular quarterly dividend of C$.28 per share) 

Record high volumes for Mowi (MHGVY-ADR) in 2020 (resumes quarterly dividend with .32NOK per share; basic E.P.S. €.09, down from €.39 in the 2019 4th quarter; negatively impacted by pricing and lost revenues due to pandemic as previously noted; divested in January 2021 shares in DESS Aquaculture Shipping for a realized gain of €54M) 

PennantPark Floating Rate Capital Ltd. (PFLT) Announces Financial Results for the Quarter Ended December 31, 2020 (NII per share = $.26, down from $.29 in the 2019 4th quarter; dividends per share at $.285-dividend not covered; adjusted net asset value per share = $12.32) 

Southern Company (SO) reports fourth-quarter and full-year 2020 earnings (non-GAAP 4th quarter net income reported at $497M or $.47 per share, up from $.27 in the 2019 4th quarter; consensus non-GAAP at $.416 according to Fidelity; GAAP E.P.S. at $.37 compared to $.42 in the 2019 4th quarter)

Treasury IBonds:  

I have a small allocation to IBonds bought through my Treasury Direct Account. At least I earn the inflation rate on that investment. Individual - Series I Savings Bonds Rates & Terms: Calculating Interest Rates  When I bought some, the coupon rate was .1% + CPI. The current rate is zero + CPI. I am not currently interested in buying more. 

Buying IBonds Through Treasury Direct - South Gent | Seeking Alpha (5/29/16 Post)

++

Trump was guilty of inciting an insurrection, but only a few republicans will come to that obvious conclusion.  

McConnell votes for acquittal but says 'no question' Trump responsible for riot McConnell had the power to call the Senate back in session while Trump was still President but refused to do so. The senate trial could have been completed while Trump was still President. But several republican senators wanted to avoid a decision on the merits so they delayed the trial until after Trump left office and then argued that, due to McConnell's refusal to hold the trial while Trump was still in office, the trial was unconstitutional.  

Trump response to McConnell: "Mitch is a dour, sullen and unsmiling political hack, and if Republican Senators are going to stay with him, they will not win again".  Sure, Mitch is a shameless, dour, sullen, political hack, but he is not responsible for republican losses in recent elections. Donald is responsible for republican Senate and House losses in 2018 and 2020, but he will never take responsibility for bad outcomes. He will take credit for positive outcomes when he deserves no credit however. 

New details about Trump-McCarthy shouting match show Trump refused to call off the rioters 

Mitch McConnell: Read the Senate minority leader's remarks following Trump's acquittal 

There Is No Defense—Only Complicity - The Atlantic

Louisiana GOP Official Calls Bill Cassidy a 'Senator Without a Party' After Impeachment Vote The Louisiana GOP censored Cassidy for his vote. 

Fact check: Trump lawyer closes impeachment defense with a barrage of dishonesty 

Michigan Senate GOP leader Shirkey falsely claims dead people voted When asked for proof, Shirkey could not identify a single dead person who voted. Shirkey recently received some blowback from non-Trumpsters when he claimed that the 1/6/21 Trumpster riot at the nation's capitol was a hoax.   

Promotions for Female Generals Were Delayed Over Fears of Trump’s Reaction - The New York Times

Texas Power Failure: 

How Fox News is exploiting Texas’ power outages to fearmonger about clean energy | Media Matters for America; Natural gas, not wind turbines, main driver of Texas power shortage The republican Texas Governor joined Fox "news" in lying about the causes since he does not want voters to pin the blame where it belongs. 'Morning Joe': Texas Governor Is 'Lying' About Renewable Energy; Blaming the Wind for the Mess in Texas Is Painfully Absurd | The New Yorker

Donald Trump Jr. called the Texas "democrat" governor incompetent. In tweet defending Cruz, Donald Trump Jr. blasts incompetence of Texas' 'Democrat Governor' | The Daily

One needed change in Texas is weatherization of generation facilities which was recommended a decade ago by the Federal Energy Regulatory Commission after a similar power failure. The recommendation was of course ignored as to enforcement by the republicans in Texas who control the state. Texas Was Warned a Decade Ago Its Grid Was Unready for Cold- Bloomberg; How one Texas storm exposed an energy grid unprepared for climate change Perhaps the Texas republicans  and Fox "news" need to explain how wind generation works in Greenland and why many of the  wind turbines in Texas froze up during the mild by Greenland standards freeze. 

Other utilities that experience far deeper and more frequent deep freezes did not have a problem with power generation from renewable or other sources. There will be isolated problems during deep freeze events with snow and ice due to trees falling over distribution power lines. The problem in Texas was that its non-weatherized generation went offline as demand spiked due to the cold weather.    

The massive power failure is peculiar to Texas which is not connected to the nation's grid  Why does Texas have its own power grid? | Fort Worth Star-Telegram The state refused to weatherize its generation facilities and will not connect to the interstate grid, where it could draw power to meet unanticipated power, since the republicans view it as more important to have a less reliable power system that is not subject to any federal regulation.

Perry says Texans willing to suffer blackouts to keep feds out of power market Perry is a former republican governor of Texas and was Donald's Secretary of Energy. Rick Perry's College Transcript: A Lot Of Cs And Ds at a non-challenging college 

So Governor Abbott and other republican politicians blamed wind energy in an effort to avoid pointing to themselves as the primary reason why Texas experienced widespread blackouts and millions suffered as a result. Sweden Shows Texas How to Keep Turbines Going in Icy Weather - Bloomberg If Texans want a reliable power system, the republicans will have to be removed from power throughout state government. It is that simple IMO. 

+++++

1. Small Ball: 

A. Started NOMD-Bought 5 at $25.85: 

Quote: Nomad Foods Ltd. (NOMD) 

Closing Price 2/19/21: NOMD $26.37 +$0.30  +1.15% 

NOMD is Europe's leading frozen food company and is based in the U.K. 

NOMD Analyst Estimates | MarketWatch

Website: Home | Nomad Foods

NOMD SEC Filings 

Last Earnings Report (Q/E 9/30/20): SEC Filed Press Release 

Reported revenue increased 6.7% to €576 million

Organic revenue growth of 5.4% 

Reported Profit for the period of €56 million 

Adjusted EBITDA increased 13% to €109 million

Adjusted EP.S. increased 20% to €.3 

The 2020 4th quarter earnings report is scheduled for release on 2/25. 

Recent News:

Nomad Foods Completes Acquisition of Findus Switzerland for approximately €110M. 

Nomad Foods Enters into Exclusive Negotiations to Acquire Fortenova Group’s Frozen Food Portfolio (1/11/21)

Nomad Foods Raises 2020 Guidance and Announces Significant Share Repurchase Activity 

B. Started RCII-Bought 2 at $47.33; 3 at $46.5; 2 at $44; 1 at $43.5; 2 at $43; 2 at $42.5: 

 

Quote: Rent-A-Center Inc. (RCII) 

Closing Price 2/19: RCII $52.42 +$1.11 +2.16% 

RCII "is an industry leading omni-channel lease-to-own provider for the credit constrained customer . . Preferred Lease provides virtual and staffed lease-to-own solutions to retail partners in stores and online enabling our partners to grow sales by expanding their customer base utilizing our differentiated offering. The Rent-A-Center Business and Mexico segments provide lease-to-own options on products such as furniture, appliances, consumer electronics, and computers in approximately 1,950 Rent-A-Center stores in the United States, Mexico, and Puerto Rico and on its e-commerce platform, Rentacenter.com. The Franchising segment is a national franchiser of approximately 460 franchise locations."

RCII  Analyst Estimates | MarketWatch

RCII SEC Filings

Investor Overview - Rent-A-Center

Average Cost Per Share: $44.72 (12 shares this account)

Dividend: Quarterly at $.31 per share, last increased from $.29 effective for the last payment. 

 

Yield at AC = 2.77%

Last Ex Dividend: 12/14/20

5 year Chart: 

Last Earnings Report (Q/E 9/30/20) SEC Filed News Release 

E.P.S.  = $1.15

Non GAAP E.P.S. = $1.04, up 120.9%

Same Store Sales: +12.9%

E-Commerce Sales: +71%  

The 2020 4th quarter report is scheduled for release on 2/24. 

On 2/4/21, the company did raise its guidance for 2020 to a Non-GAAP E.P.S. range between $3.51 to $3.56 from $3.35 to $3.5. Rent-A-Center, Inc. Provides Estimated Preliminary 2020 Results 

Other news: 

Rent-A-Center Enters Into Definitive Agreement to Acquire Acima to Create Leading Virtual Lease-to-Own Platform, Accelerate Long-Term Growth (12/20/20)(RCII "announced that it has entered into a definitive agreement to acquire Acima Holdings LLC, a leading provider of virtual lease-to-own solutions. Total consideration consists of $1.273 billion in cash and approximately 10.8 million shares of Rent-A-Center common stock currently valued at $377 million". In 2020, ACIMA ie expected to have about $1.25B in revenue and $225M in adjusted EBITDA.) 

Rent-A-Center Closes Acquisition of Acima Holdings 

Rent-A-Center, Inc. Announces Pricing of $450 Million of 6.375% Senior Unsecured Notes Due 2029 (2/4/21)(rated at B3 by Moody's)

C. Pared HBNC in Fidelity Taxable-Sold 5 at $17.02:

Quote: Horizon Bancorp Inc.  (HBNC)

HBNC Analyst Estimates

HBNC SEC Filings

Investment Category:  Regional Bank Basket Strategy

Profit Snapshot: $31.09

Last Buy Discussion: Item # 1.K Added HBNC Fidelity Taxable Account-Bought 5 at $10.3; 2 at $9.9; 3 at $9.57 (10/10/20 Post)

Average Cost After Pare this account  = $10.24

Snapshot after pare Intraday 1/20/21 

Tangible Book Value per share as of 12/31/20: $11.78

Dividend: Quarterly at $.12 per share, last raised from $.10 effective for the 2019 third quarter payment. 

Yield at AC = 4.69%

Last Ex Dividend: 1/7/21

Last Earnings Report (Q/E 12/31/20): SEC Filed Press Release

E.P.S. = $.50, up from $.41 in the 2019 4th Q 

NIM = 3.34%, down from 3.58%

Adjusted Efficiency Ratio = 56.48%

ROA = 1.49%

ROE = 12.79%

NPL Ratio: .69%

Charge Off Ratio: .01% (excellent)

"Fourth quarter 2020 income from the gain on sale of mortgage loans, totaled $7.8 million in the fourth quarter of 2020, down from $8.8 million in the linked quarter and up from $3.1 million in the prior year period." (emphasis added). Gains from selling mortgages were unusually high last year due to the decline in interest rates.  

"COVID–19 deferral levels improved to 3.5% of total loans at period end, compared to 4.1% on September 30, 2020 and 14.3% on June 30, 2020 and the bank experienced no material specific loan losses attributed to COVID–19 closures in 2020."

Sell Discussions: Item # 2 Sold 60 HBNC at $24.96  (4/30/12 Post)(profit snapshot = $429.68); Item # 3.C. Sold Highest Cost HBNC Lots-10 at $14.25; 5 at $14.8 (12/5/20 Post)(profit snapshot = $46.53) 

HBNC Realized Gains to Date: $475.21

D. Added to BHB-Bought 2 at $22.75; 5 at $21.5:  

Quote: Bar Harbor Bankshares (BHB)

BHB SEC Filings

Closing Price 2/19/21: BHB $25.24 +$0.24  +0.96% 

Investment Category: Regional Bank Basket Strategy

Position this Account: 65+ shares

Average Cost per share = $20.28

Dividend: Quarterly at $.22 per share

Yield at AC = 4.34%

Last Ex Dividend: 2/17/21 (owned all as of)

Last Substantive Buy Discussion: Item # 2.D. Added to BHB-Bought 5 at $17.5; 5 at $14; 2 at $13.8; 2 at $13.5 (5/2/2020 Post)

Last Sell Discussions: Item # 3.A. Pared BHB-Sold 40 at $24.48-highest cost lots in Fidelity taxable account (12/5/20 Post); Item # 3.B. Eliminated BHB-Sold 54+ Shares at $26.34 (5/18/19 Post); Item # 1.A. Sold 100 BHB at $30.69-Used Commission Free Trade (7/15/18 Post); Item # 1.A. Sold 50 BHB at $30.02 (5/21/18 Post); Item # 1. A. Sold 30 BHB at $29.42 (3/25/18 Post); Sold 100 BHB Update For Regional Bank Basket Strategy As Of 5/6/2016 - South Gent | Seeking Alpha

Last Earnings Report (Q/E 12/31/20): Bar Harbor Bankshares Reports Fourth Quarter Results

GAAP E.P.S. = $.58 

Non-GAAP = $.62 compared to $.56 for the Q/E 12/31/19 (GAAP included a swap termination fee and profitability initiative costs

NIM = 3.02%

Core NIM = 2.79%

Efficiency Ratio: 61.98%

NPL Ratio: .48%

NPA Ratio: .33%

Charge Off Ratio: .03% 

Core ROA = .98%

Core ROE  = 8.95%  

Core ROTE = 13.27%

Tangible Book Value Per Share =  $19.05

Tangible Equity to Tangible Assets = 7.9%

BHB Realized Gains to Date: $4,223.71 

E. Restarted HCMLY-Bought 10 at $11.4; 5 at $11.02; 10 at $10.89: 

Quote: LafargeHolcim Ltd. ADR Lafarge is based in Switzerland.  

Website: LafargeHolcim, industry experts in building materials (cement, aggregates, and ready mix concrete)

Media releases

The ordinary shares are priced in Swiss Francs: LafargeHolcim Ltd. (Switzerland: SWX ) | MarketWatch

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

ADR Ratio: 1 ADR = .2 ordinary

The ADR is traded on the U.S. Pink Sheet exchange. 

HCMLY Analyst Estimates | MarketWatch

Last Sell Discussion: Item # 4 Sold 200 HCMLY at $11.74 (4/5/17 Post)(profit snapshot = $109.95) 

Dividend: Annually at 2 CHFs or .4 CHFs for HCMLY owners, subject to Swiss withholding tax. LafargeHolcim shares dividend history

Last Ex Dividend: 5/15/20 

Earnings reports are released semi-annually. The last report was for the 6 month period ending on 6/30/20:

Half-Year Results 2020 | LafargeHolcim.com

The annual report is generally released in late February. I will discuss that report after it is issued. 2020 results were adversely impacted by the pandemic. HCMLY is a recovery play and hoped for major increases in infrastructure spending.   

The following development caused me to restart a position:  

LafargeHolcim has signed an agreement to acquire Firestone Building Products (FSBP), a leader in commercial roofing and building envelope solutions based in the United States. (1/7/2021)(Firestone Building Products is "a leader in commercial roofing and building envelope solutions based in the United States (US), with 2020 (est.) net sales of USD 1.8 billion and EBITDA of USD 270 million. . .This transaction is valued at USD 3.4 billion, to be financed with cash and debt while maintaining net debt below 2x. Synergies of USD 110 million per year are expected on a run-rate basis within two years of closing, which is expected in the second quarter. The acquisition is earnings per share (EPS) accretive from the first year.") 

LafargeHolcim announces two bolt-on acquisitions to accelerate growth in Europe (2/1/21)

F. Eliminated KC- Sold 2 KC at $52.2 in Schwab Taxable and 3 at $69.21 in Fidelity Taxable: 

Quote: Kingsoft Cloud Holdings Ltd. ADR (KC)

KC Analyst Estimates

SEC Filings

IPO at $17 in May 2020. Prospectus

Profit Snapshots:  $159.03

Item # 1.J. Started KC-Bought 1 $32.25; 1 at $30 1 at $28.45  (10/24/20 Post) 

Lottery Ticket Basket Strategy

G. Multiple LMT  Small Dollar Buys at $334; $332.5; $331; $328.93; $328.63; $324; $322  ; 

Quote: Lockheed Martin Corp.

Closing Price 2/19: LMT $335.42 -$2.50 -0.74% 

LMT Analyst Estimates-MarketWatch

Website: Lockheed Martin Corporation 

LMT SEC Filings

Last Discussed: Item # 1.K. (1/9/21 Post) 

5 Year Historical: 

2020 Annual Report at page 30 The decline in 2017 earnings was due to "a net one-time tax charge of $2.0 billion ($6.77 per share), substantially all of which was non-cash, primarily related to the estimated impact of the Tax Cuts and Jobs Act of 2017." (see footnote g) 

Investors are concerned about what the Biden administration may do, including the possible cancellation of F-35 fighter sales to the United Arab Emirates. UAE confirms it inked $23 billion deal to buy F-35 jets, drones from U.S. | Reuters (1/22/21) Those sales have been put on hold pending review by the Biden administration. Biden administration halts arms sales to UAE and Saudi Arabia | News | DW 

Last Earnings Report (Q/E 12/30/20): SEC Filed Press Release

"fourth quarter 2020 net sales of $17.0 billion, compared to $15.9 billion in the fourth quarter of 2019. Net earnings from continuing operations in the fourth quarter of 2020 were $1.8 billion, or $6.38 per share, compared to $1.5 billion, or $5.29 per share, in the fourth quarter of 2019. Cash from operations in the fourth quarter of 2020 was $1.8 billion, compared to $1.5 billion in the fourth quarter of 2019. Cash from operations was after discretionary pension contributions of $1.0 billion in each of the fourth quarters of 2020 and 2019."

2021 Financial Outlook: 

2021 Midpoint E.P.S. = $26.15

P/E at AC of $336.84 (2+ shares) and E.P.S. at $26.15 = 12.88

H. Started KREF-Bought 10 at $17.7; 10 at $17.58; 10 at $17.3; 10 at $17.2: 

Quote: KKR Real Estate Finance Trust Inc. 

Closing Price 2/19: KREF $18.54  +$0.17  +0.93% 

KREF SEC Filings 

2020 Annual Report (risk summary starts at page 10 and ends at page 51)

Classification: Mortgage REIT "that focuses primarily on originating and acquiring senior loans secured by commercial real estate ("CRE") assets."

 

Management: External

After my purchases, JPM raised KREF to overweight with a $19 PT. 

Average Cost per share = $17.45 (40 shares)

Dividend: Quarterly at $.43 per share ($1.72 annually)

Yield at $17.45 = 9.86%

Last Earnings Report (Q/E 12/31/20): SEC Filed Press Release

Released after my purchases.  

Net Income per share: $.52 for the 4th quarter

Distributable Earnings of $.48 per share for the 4th quarter and $1.95 for 2020

Portfolio: $5B funded-97.7% performing

Weighted Average Loan-to-Value Ratio: 67%

Book Value Per Share = $18.76

See also, SEC Filed Supplemental for the 4th quarter 

I. Started WEC-Bought 2 at $87.8; 1 at $86.9; 1 at $86.5; 1 at $85.9; 1 at $85.1; 1 at $84.25; 1 at $82.8; 1 at $81.9:  

Quote: WEC Energy Group Inc. 

Stock Information as of 2/19/21: 

 

WEC is a utility holding company "based in Milwaukee, is one of the  nation’s premier energy companies, serving 4.6 million customers in Wisconsin, Illinois, Michigan and Minnesota.The company’s principal utilities are We Energies, Wisconsin Public Service, Peoples Gas, North Shore Gas, Michigan Gas Utilities, Minnesota Energy Resources and Upper Michigan Energy Resources. Another major subsidiary, We Power, designs, builds and owns electric generating plants. In addition, WEC Infrastructure LLC owns a growing fleet of renewable generation facilities in the Midwest."

Owns a 60% interest in American Transmission. 

Rate Base: About $22B

Customers: About 1.6M electric in Wisconsin and Michigan and 2.9M gas in Wisconsin, Michigan, Illinois and Minnesota 

Through 2025, plans 800MW of new solar generation; 600 MW of new battery storage; 100 MW of new wind generation; and $2.2B in unregulated renewable energy. Plans to retire 1400MW of coal generation and 400MW of less efficient natural  gas generation.  

WEC Analyst Estimates | MarketWatch

WEC SEC Filings 

Investment Category: Bond Substitute/Dividend Growth

Average Cost Per Share: $84.99 (10 shares)

Dividend: Quarterly at $.6775 ($2.71 annually), last raised from $.6325 effective for the 2021 first quarter payment

Dividend History: 

WEC Energy Group-Dividend history

Yield at AC = 3.19%

Last Ex Dividend: 2/11/21

5 Year Chart: 

The most recent headwind for the stock has been the rise in intermediate and longer term interest rates. 

Last Earnings Report (Q/E 12/31/20): SEC Filed Press Release 

Electric and gas utilities faced headwinds in 2020 due to lower demand caused by the pandemic. 

E.P.S. at $.76

Consensus at $.73

E.P.S. for 2020 = $3.79 (up from $3.58 in 2019)  

Reaffirms 2021 operating E.P.S. in the range of $3.99 to $4.03 in line with guidance to deliver 5% to 7% earnings growth annually. 

Broker Reports (available to Schwab customers):

Morningstar (2/4/21): 3 stars with a $91 FV

S & P (2/9/21): 2 stars with a $81 PT

Argus (11/19/21): Buy with a $110 PT

J. Started REYN in Schwab Taxable: Bought 5 at $29.95; 5 at $28.95; 2 at $28.58: 

Quote: Reynolds Consumer Products Inc. (REYN)

Brands | Reynolds Consumer Products The main brands are Hefty garbage bags, Reynolds Wrap aluminum foil and related products, Presto food storage bags, FreshLock zipper and Slide-Rite storage bags.  The company has benefited from more cooking at home due to the pandemic. 

AC This Account: $29.3 per share

Dividend: Quarterly at $.23, raised from $.22 effective for the 2021 first quarter payment. 

Yield at AC  = 3.14%

Next Ex Dividend: 2/22/21

Last Discussed: Item # 2.J. Added to REYN in Fidelity Taxable Account-Bought 1 at $30; 2 at $29.25, 2 at $28.5; 2 at $28.2; 2 at $27.9 (11/13/20 Post) 

Last Earnings Report (12/30/20): Released after purchases. Reynolds Consumer Products Reports Fourth Quarter and Fiscal 2020 Financial Results 

GAAP E.P.S. at $.53

Non-GAAP E.P.S. at $.57 in line with consensus

Net revenues up 6% Y-O-Y

Increased quarterly dividend per share to $.23 from $.22. 

2021 Guidance Non-GAAP E.P.S. = $1.96 to $2.03

2020 Non-GAAP Actual = $1.97

2021 Guidance GAAP E.P.S. = $1.90 to $1.98 

Overall, the 2021 guidance reflects anemic earnings growth Y-O-Y.  

I would note that the 2020 guidance made in March 2020 proved to be way off at non-GAAP between $1.67 to $1.76  vs. $1.97 actual. REYN benefited from more in-home dining.  

GAAP E.P.S. was reported at $1.45 in 2019. 

The IPO was in January 2020 with the public offering price at $26.  Prospectus 

K. Eliminated SKT-Sold 50 at $18.17-IB Account: 

Quote: Tanger Factory Outlet Centers Inc. (SKT) 

SEC Filings 

Profit Snapshot: +$185.84

Investment Strategy: Equity REIT Common and Preferred Stock Basket Strategy

I mentioned this sell in a 1/27/21 comment. As of 12/31/20, the short position as a percentage of the float was at 49.7%. The stock price appreciation in January was most likely due to a short squeeze which was common among heavily shorted stocks last month. Check out the most heavily shorted stocks this year—GameStop tops the list - MarketWatch (1/27/21) 

5 Year Chart:  

Before the pandemic SKT was facing serious problems with tenant bankruptcies. The pandemic accelerated those problems and added delays in rent payments from some solvent tenants. SKT eliminated its dividend for  2 quarters last year and recently resumed payments at a reduced penny rate. The penny rate was reduced to $.355 to $.177. 

I just wanted to get out of my small position and consequently used a non-fundamentally based price pop to sell at a profit. 

Last Earnings Report (Q/E 12/30/20): SEC Filed Press Release 

L. Added to SNY-Bought 10 at $47.8: 

Quote:Sanofi ADR

SNY Analyst Estimates

Sanofi S.A. (France: Euronext Paris)

ADR Ratio: 1 ADR - .5 ordinary share

Last Discussed: Item # 1.A. Restarted SNY-Bought 10 at  (1/23/21 Post) 

Dividend: The proposed annual dividend this year is €3.2 which translates into €1.6 per ADR share. 

Last Earnings Report (Q/E 12/31/20): This report was released after this purchase. Sanofi delivered close to double-digit Q4 2020 business EPS(1) growth at CER This report contains a revenue breakdown by product. 

"In the fourth quarter of 2020, Sanofi sales were €9,382 million, down 2.4% on a reported basis. Exchange rate movements had a negative effect of 6.6 percentage points, mainly driven by the decrease of the U.S. dollar, Brazilian real, Turkish lira, Russian ruble, Mexican and Argentine pesos. At CER, Sanofi sales increased 4.2%."

"Full-year 2020, Sanofi sales reached €36,041 million, down 0.2% on a reported basis. Exchange rate movements had a negative effect of 3.5 percentage points. At CER, Sanofi sales were up 3.3%."

CER = Constant Exchange Rates

E.P.S. = €.86

"Business E.P.S." = €1.22

Consensus in USD per ADR = $.69 according to Fidelity

Dupixent revenues rose 54.2% Y-O-Y to €982M. In my last post discussing SNY, linked above, I mentioned this drug as the main reason why I have restarted a position. 

Vaccine revenues were up 14.6%. 

A judge in Hawaii found that BMY and SNY violated a consumer protection law by failing to warn consumers that Plavix may not have been as effective as claimed for some non-white patients. Bristol-Myers, Sanofi ordered to pay Hawaii $834 million over Plavix warning label | Reuters  

M. Pared EBIX-Sold 1 at $53: 

Quote: Ebix, Inc.

I mentioned paring my EBIX position in a 1/27/21 comment.

EBIX SEC Filings

EBIX Historical Stock Prices

Website: Ebix

Lottery Ticket Basket Strategy

Profit Snapshot: $31.51  

Last Discussed: Item # 2.N. Started EBIX-Bought 8 at an Average Cost per share of $20.72 (11/13/20 Post) 

1 year chart: 

N. Eliminated CSCO in Schwab Account-Sold 4 + at $47.21: 

Quote: Cisco Systems Inc.

Closing Price 2/19: CSCO $45.68 -$0.66 -1.42% 

CSCO Analyst Estimates

CSCO SEC Filings

Recent History this Account: 

I still own shares in my Fidelity taxable account (15+ shares with at $39.33 AC). 

Profit Snapshot 4+ Shares: +$40.16

The largest profit in this account occurred in 2018 when I sold 50 shares realizing an $885.28 : 

The 5 share lot sold in 2020 generated a $11.7 profit:

Last Discussed: Item # 2.F. Sold 3 CSCO in Fidelity Taxable Account at $42.8-highest cost lots (12/25/20 Post)(discussed earnings report for the F/Q ending 10/24/20).  

Last Earnings Report (Q/E 1/23/21): SEC Filed Press Release I was not impressed. 

GAAP E.P.S. at $.60, down from $.68 

Non-GAAP at $.79 (consensus at $.755 according to Fidelity), up from $.77 in the year ago quarter. Just a $.02 Y-O-Y increase. I have seen far better Y-O-Y results from electric utilities. 

Reconciliation Data: 

Revenue: $12B flat Y-O-Y

Dividend: Quarterly at $.37, raised from $.36 effective for the next payment

Dividends & Splits - Cisco

Next Ex Dividend: 4/5/21

Item # 1.H. (9/13/2020)(contains snapshots of roundtrip trades starting in 2010 and ending in 2019 generating a profit of $1,804.65) 

Realized CSCO Profits Starting in 2010: $1,858.3

I have not been impressed by CSCO's earnings report for awhile.  

O. Pared ERC-Sold 10 at $12.6-highest cost lot: 

Quote: -Wells Fargo Multi-Sector Income Fund Overview - A Leveraged CEF

ERC SEC Filings 

Last SEC Filed Shareholder Report (period ending 10/31/20)

Leverage: 27.21% as of 2/15/21 according to CEF Connect

Credit Ratings as of 10/31/20: 

Sourced:  Multi-Sector Income Fund (fact sheet, PDF) 

2021 Profit Snapshot (20 shares):  +$16.62

AC Before Pare: $9.49

53+ shares

AC After Pare= $8.92 (43+ shares)

Dividend: Monthly at $.0916, trending down monthly.

There is significant ROC support for the dividend. 

Yield at AC = 12.11%  (assumes annual at $1.08)

For purposes of computing yield, I just rounded the dividend rate to $.09 per share which assumes that the penny rate will continue to move down and will average somewhere close to 9 cents over the next 12 months. 

Data Date of 2/16/20 Trade: 

Closing Net Asset Value Per Share: $13.08

Closing Market Price: $12.49

Discount: -4.15%

Average Discounts as of 2/16: 

1 YR  -8.5%  

3YR  -7.72%

5 YR -8.19%

Sourced: ERC-CEF Connect (click "pricing information" tab)

Wells Fargo Multi-Sec Income (ERC) Quote | Morningstar (Rated 3 stars)

ERC has benefited recently from its significant exposure to junk bonds, which is a reason justifying this pare IMO. 

The discount to net asset value per share has significantly narrowed since my purchases and is currently below the 1, 3 and 5 year historical averages. Those are two more justifications for the pare IMO.  

I am not impressed with the managers of this fund.  The fund has a net loss on holdings as of 10/31/20 and a significant net loss carryforward. 

That is IMO an extremely poor result in a bond bull market. That history is another justification for the pare and tiny position. 

I will opportunistically trade ERC which explains the purchases made in March 2020. I started the position too early by buying 20 shares in late February which have now been sold profitably.  

Goal: Total return in excess of the dividend paid before adjustment to the tax cost basis for ROC. 

P. Continued to PARE Highest Cost FAX Shares-Sold 10 at $4.52: 

Quote: Aberdeen Asia-Pacific Income Fund Inc. Overview - A leveraged bond CEF 

FAX-CEF Connect Website

Year-To-Date Profit: +$133.18  

New Average Cost Per Share: $2.91

Dividend: Monthly at $.0275 per share ($.33 annually). Supported by ROC.

Yield at $2.91 = 11.34%

Last Discussed: Item 3.M. Sold 103 FAX at $4.46 (1/30/21 Post) I have nothing further to add to that discussion. 

Goal: Total return in excess of the dividends paid before the ROC adjustment to the tax cost basis. 

Q. Bought  5 CC at $25.2 in Schwab Taxable Account: 

Quote:  Chemours Co.

Closing Price 2/19/21: CC $25.95 +$1.10  +4.43% 

Last Discussed: Item # 1.D. Started CC in Fidelity Taxable Account-Bought 5 at $26.6; 5 at $26.14; 5 at $25.4; 5 at $24.8; 5 at $24.3 and Sold 22 CC Vanguard Taxable account at $28.5 (1/16/21 Post)(profit snapshot = $45.79) 

Add based on better than expected 4th Q earnings report: The Chemours Company (CC) Reports Strong Fourth Quarter and Full Year 2020 Results with Solid Momentum Across Core Markets (GAAP E.P.S. $.11; adjusted E.P.S. at $.61; consensus at $.411 according to fidelity; free cash flow at $300M)

As discussed in prior posts, caution is warranted IMO due to PFAS cleanup and litigation exposure. 

Dividend: Quarterly at $.25 per share 

Next Ex Dividend: 2/25/21

Yield at $25.2  = 3.97% 

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.