BDN, D, DEI, EAI, ENB.PRP:CA, FHN, FNF, FSK, GILD, GPC, HRZN, LMT, NOMD, REYN, SBRA, TECB, XOM

Economy: 

Investors overreacted last Thursday IMO to a better than expected October CPI report. While CPI may have peaked, and I believe that is the case, it remains at problematic levels. There is no certainty yet that the recent decline is even the start of a persistent downtrend.   

Annual CPI Increase: 7.7%, prior month at 8.2%  

Annual Core CPI Increase: 6.3%, prior month at 6.6% 

Fed Vice Chair Brainard says it may 'soon' be appropriate to move to slower pace of rate hikes

Currently CME FedWatch Tool has a 50 basis point hike in the FF rate next month at about 80%. If that happens, the new target rate as of 12/14/22 would be 4.25% to 4.5%.  

++

Putin /Russia: 

Medvedev Hints at Russian Nukes As Ukraine War Continues to Go Badly Medvedev has repeatedly threatened Ukraine with nuclear weapons. For a brief time, some western leaders incorrectly viewed Medvedev, one of Putin's soulmates and fellow kleptocrat, as a "good Russian".

Ukraine forces enter Kherson as Russia retreats across Dnieper River ("jubilant civilians flocked to the city's central square to greet advancing soldiers") Kherson was the only regional capital seized by Russia since its invasion started on 2/24/22. 

Before leaving Kherson, the Russians destroyed civilian infrastructure in order to deprive its citizens of power and clean water. Amid Joy in Kherson, a Humanitarian Disaster Looms - The New York Times

Kherson residents celebrate liberation and describe trauma of occupation - The Washington Post

Russia Tried to Absorb Ukraine’s Kherson City. It Didn’t Work. - The New York Times

Kherson residents describe detentions and torture under Russian occupation - The Washington Post Russia disappeared many civilian residents of Kherson including the mayor. Savage torture was routine. Citizens of NATO countries need to fully understand and accept what Russians are capable of doing to them.   

Russia declared last Friday that Kherson was still part of Russia. Ukraine war: Kherson 'still part of Russia'-Euronews

Maybe Russia would like to hold another referendum now, this time under U.N. supervision, where Kherson residents, excluding Russian soldiers dress in civilian clothes, can decide whether to join the Russian Federation or remain Ukrainian citizens. 

Putin's retreat from Kherson is a military disaster | Maj. Gen. Chip Chapman - YouTube Chapman points out correctly that Kherson was the launching point for Russia's invasion of western Ukraine, extending to Odessa and then into Moldova. That advance was stopped near Mykolaiv by the Ukrainian army. The "special military operation" also included an attack from the north aimed at capturing Kiev, thereby decapitating the democratically elected Ukrainian government,  which was repulsed near the Ukrainian capital. 

I wonder how much Putin is paying the so-called separatist leaders in Donetsk and Luhansk. What are the Ukraine 'separatist' regions at the crux of the Russian invasion - ABC News (over 1 million people displaced due to Russia's imperial ambitions in those areas). Putin and his puppets have only succeeded in making life miserable for the Russian speaking population in those areas and in Ukraine as well. Russia has destroyed entire cities and towns where the majority of citizens are Russian language speakers, with  Mariupol being the most significant example. Mariupol before and after images - Google 

+++

Trump and His Party: 

Trump D.C. hotel receipts reveal $10,500-a-night rooms for foreign officials seeking to influence U.S. policy

Two of Demagogue Don's most recent Pants on Fire tweets: PolitiFact | Trump falsely claims Nevada and Arizona election officials ‘want more time to cheat’ (Donald needs to be sued by those officials); PolitiFact | No evidence for Donald Trump's claim about stopping a 'steal' in 2018 for Ron DeSantis Lying all of the time about almost everything works on the intended audience who believe that Donald is honest. 

6/18/20 - -Quinnipiac University Poll

The Tennessee Republicans succeeded in throwing democracy under the bus in pursuit of power. 

As a result of obvious racial and political gerrymandering, the anti-democracy party carved up Nashville into three newly formed congressional districts, joining each part with heavily republican rural areas and small towns. 

The result, which was expected and easily predictable, was that the republican state legislature chose 3 far right Trumpsters to represent parts of Nashville, even though the voters would have chosen a Democrat. 

Even though all 3 Democrat candidates in the 3 gerrymandered districts handily won the voting in Nashville, the overall results were not even close. 

Newly Drawn 7th Congressional District/Nashville Votes. The predominantly African American North Nashville is now represented by the Trumpster who lives in Clarksville, TN. 

Newly Drawn 6th Congressional District/Nashville Votes (primarily liberal areas of East Nashville who are now represented by a Trumpster who lives in Cookeville, TN.)

Newly Drawn 5th Congressional District: Nashville Votes (now represented by a Trumpster who lives in Columbia, TN) 

This district includes several republican areas in Nashville which explains why the Democrat only won 60% of the vote. 

There is no reason for democrats in Nashville to even vote for congressional representatives anymore. They have no choice in who will represent them. And knowing that to be case, candidate quality in future elections will suffer as will funding of those candidates. 

Two of Nashville's newly elected Trumpster congressional representatives, Mark Green and John Rose, joined in the Supreme Court petition to throw out the certified election results in 4 states won by Biden and requested that the Court authorize the republican dominated legislatures in those states to select Trump electors. House Members Who Signed a Brief Asking the Supreme Court to Consider Overturning the Election | Represent | ProPublica All of the incumbent Tennessee republican House representatives signed that petition. 

The third newly elected Trumpster, Andy Ogles, replaced the Democrat who had represented all of Nashville and elected to retire since there was no way that he could win in the newly drawn 5th congressional district after winning 100% in 2020. 

2020 Election Results 

Ogles would have signed that Supreme Court petition if he had been a member of Congress. 

Anyone who signed it is an enemy of democracy IMO and none of them are "conservatives".

Prayer for Relief: 

Republicans defend their gerrymandering in Tennessee by claiming it was done by a "bipartisan" commission. The commission consisted of 7 republicans who voted for the gerrymandering and 2 democrats who voted against.  

Trump Is 'Livid' and 'Screaming' After GOP Midterm Flops: Report 

'Furious' Trump is pinning the blame on Melania for his decision to back Dr. Oz: reporter - Raw Story 

While the Senate election results are not surprising, the GOP's failure to pick up more seats in the House is a big surprise. Several of the congressional districts flipped by the GOP, including those in NY, will be lost in 2024 IMO. 

Marie Gluesenkamp Perez’s Win Shows Why Republicans Flopped This Fall - The Atlantic 

Senator Graham (R-SC): Walker Critics Out to 'Destroy' Him to 'Deter' Young Minorities From GOP I do not expect Walker will win in the runoff election. If that proves correct, the Democrats will have 51 Senate seats with the VP being able to break any tie resulting from 1 Democrat defection.  

Trump Wanted I.R.S. Investigations of Foes, Top Aide John Kelly Says - The New York Times

The republican nominee for Maryland's Governor, Dan Cox, could not admit that he lost the election: 

He only acknowledged that Moore had been declared the winner by third parties and then made this statement: "Our internal data demonstrated a massive shift of swing voters our way and a huge turnout of Republicans — neither of which is reported to have occurred.” The Democrats can only pray that republicans continue to nominate candidates like Cox. 

++++

Allocation Shifts Discussed in this Post: 

Corporate Bonds and Treasuries: +$32,000

Net Common Stock: -$4,612.39

(Consisting of Common Stock Sell Proceeds of $5,246.23 - Common Stocks Buys of +$633.84)

Canadian Equity Preferred Stock: +C$1,620

Common Stock Realized Gains: +$2,021.85 (mostly from FHN, GILD and LMT)

Exchange Traded First Mortgage Bond: +$104.1

Some minor small ball purchases and sells over the past week are not discussed in this post. 

++++

1. Eliminated FHN - Sold 5 at $24.38; 20+ at $24.47; and 47+ at $24.38:

Quote: First Horizon Corp. (FHN)

TD to Expand in the Southeastern U.S. with Acquisition of First Horizon

I mentioned this elimination in a comment published on 11/8/22.

Investment Category: Regional Bank Basket Strategy

Profit Snapshots: $1,071.04  (11/8/22 sale only for Fidelity Account)

2022 Fidelity Total = $2,030.02/$727.52 from 47+ shares sold on 11/8/22

Vanguard Account 5 shares + $37.25

Schwab Account 20+ shares +$306.27 

I will not be buying FHN shares again unless TD's acquisition falls through and the FHN price sinks to an attractive valuation level several months after the dust settles. 

Last Discussed: Item # 1. Pared FHN in Fidelity Account - Sold 450 at $24.33 (11/1/22 Post) 

I discussed the last earnings report in this post and have nothing further to add here: Item # 5.K. Pared FHN in Fidelity Taxable Account - Sold 26+ at $24.02 and Item # 5.L. Pared FHN in Schwab Account - Sold 10 at $24.15 (10/25/22 Post)

FHN Realized Gains:  +$2,818.19

2. Canadian Reset Equity Preferred Stocks: 

A. Added to ENB.PRP:CA - Bought 100 at C$16.2: 

C$1 Commission at IB

Quote: ENB-PP.TO

I now own 500 shares. 

Last Discussed: Item # 2.A. Bought 100 ENB.PRP:CA at C$18.89  (3/31/22 Post) 

Other Currently Owned Lots: Item # 3.A. Added to ENB.PRP:CA Bought 50 at C$11.98 and 50 at C$11.76 (6/13/20 Post);Item # 3.A. Added to ENB.PRP:CA-Bought 50 at C$16.47 (2/16/20 Post): Item # 2.A. Bought 50 ENB.PRP:CA at C$15.68 (11/27/19 Post)

Security Description: Reset Equity Preferred Stock

Par Value: C$25

Current Coupon: 4.35% to but excluding 3/1/24 when the coupon resets unless redeemed at that time by the issuer. If the issuer does not redeem on the reset date, it loses its optional redemption right for another five years. 

Reset Coupon: 2.5% Spread to the 5 year Canadian government bond. 

Canada 5 Year Government Bond Overview | MarketWatch The yield has been moving up. 

When the next reset occurs in March 2024, it is probable that the reset coupon will be higher than the current one of 4.35%. 

At a 4% Canadian government 5 year bond yield on the reset date, the coupon would be 6.5% and my yield, based on my total cost for 500 shares, would rise to 10.12%. (.04% hypothetical 5 YR Canadian Bond Yield on reset date + .025% spread = .065% coupon for five years x. C$25 par value = C$1.625 annual dividend per share ÷ C$16.05 average cost per year = 10.1246% yield at a constant average cost per share)

A higher reset coupon looked unlikely when I sold the 100 shares at C$20.20 in early November 2021. I would note that the price has come down about 19% as the odds of a significant coupon increase have gone up, but all interest rates have risen which can at least partially explain that anomaly.  

Resetting at a lower coupon for five years will of course be a negative development.  And, a continued rise in interest rates after the reset is also a negative. The primary positive would be a reset for five years near a peak 5 year Canadian government bond yield with rates falling thereafter. 

The prospectus can be found here: Preferred Shares and Hybrid Securities - Enbridge Inc. 

Dividends: Quarterly and Cumulative

Average cost per share = C$16.05

Yield at AC = 6.7757%

Last Ex Dividend Date: 11/14/22 (owned 500 as of)

Sell Discussions: Item # 1.A. Sold 100 out of 400 ENB.PRP:CA at C$20.20 (12/10/21 Post)(profit snapshot = C$368); Item # 4.A. Sold 200 ENB.PRP:CA at C$19.91 (3/25/17 Post)(realized gain snapshot= C$963). The IB reportable profit in 2017 was US$606.07. That post also contains a snapshot of a 300 share round-trip that netted U.S.$1,458.25 which is after Fidelity converted the CAD profit into USDs for tax reporting purposes. That 300 share lot was bought at C$12.39. Update For Exchange Traded Bond And Preferred Stock Basket Strategy As Of 2/29/16 - South Gent | Seeking Alpha  

ENB.PRP:CA Realized Gains (after conversion into USDs for tax reporting purposes): US$2,419.66

3. Corporate Bonds: $15,000:

November Treasury Yield Curve:  

A. Bought 1 Federal Realty LP 3.95% SU Maturing on 1/15/24 at a Total Cost of 99.122: 

Issuer: Operating entity for who owns 100% of the partnership units. 

FRT SEC Filings 

FRT SEC Filed Earnings Report for the Q/E 9/30/22 

First Purchase. 

FINRA Page: Bond Detail (prospectus linked)

Credit Ratings: Baa1/BBB+ 

YTM at Total Cost = 4.654%

Current yield at TC = 3.985%

B. Bought 1 Federal Realty LP 3.95% SU Maturing on 1/15/24 at a Total Cost of 98.459: 

This is the same bond discussed in Item # 1.A. above. 

Purchased on 10/20/22. 

YTM at Total Cost = 5.26%

Current Yield at TC = 4.01%

C. Bought 1 Transcanada Pipelines 4.875% SU Maturing on 1/15/26 at a Total Cost of 99.198: 

Issuer: Originally issued by Transcanada Pipelines LTD, now a TC Energy Corp.  (TRP) obligation. 

I own the common shares. 

TC PipeLines, LP and TC Energy complete merger

TRP SEC Filings- Foreign Issuer Forms 

TRP Analyst Estimates | MarketWatch

FINRA Page: Bond Detail (prospectus not linked)

Prospectus 

Credit Rating: Baa1/BBB+

YTM at Total Cost = 5.142%

Current Yield at TC = 4.9144%.

D. Bought 2 Vulcan Materials 4.5% SU Maturing on 4/1/25 at a Total Cost of 99.285:

Issuer:  Vulcan Materials Co. (VMC) 

VMC Analyst Estimates | MarketWatch

VMC SEC Filings 

VMC SEC Filed Earnings Press Release for the Q/E 9/30/22 

FINRA Page: Bond Detail (prospectus not linked)

Credit Ratings: Baa2/BBB+

YTM at Total Cost = 4.808%

Current Yield at TC = 4.5324%

E. Bought 1 WPP Finance 3.75% SU Maturing on 9/19/24 at a Total Cost of 97.61: 

Purchased on 10/4/22. 

Issuer: Wholly owned subsidiary of  WPP PLC ADR (WPP) who guarantees the notes. 

WPP Analyst Estimates-MarketWatch

Investors | WPP

FINRA Page: Bond Detail (prospectus linked)

Credit Ratings: Baa2/BBB

YTM at Total Cost = 5.05%

Current Yield at TC = 3.84%

F. Bought 1 WPP Finance 3.75% SU Maturing on 9/19/24 at a Total Cost of 95.863:

This is the same bond discussed in Item #2.E. above. 

Purchased on 11/3/22. 

YTM at Total Cost: 6.126%

Current Yield at TC = 3.91%

I now own 3 bonds.

G. Bought 1 Site Centers 3.625% SU Maturing on 2/1/25 at a Total Cost of 94.896: 

Purchased on 10/5/22. 

Issuer: SITE Centers Corp. (SITC), formerly known as DDR Corporation and Developers Diversified Realty. This bond was issued when the REIT was known as DDR.

SITC SEC Filings 

2021 Annual Report 

FINRA Page: Bond Detail (prospectus linked)

Credit Ratings: Baa3/BBB- 

YTM at Total cost = 5.967%

Current Yield at TC = 3.82%

H. Bought 1 Wisconsin Electric 3.15% SU Maturing on 6/1/25 at a Total Cost of 95.594:

Issuer: Wholly owned subsidiary of the utility holding company WEC Energy Group Inc.  (WEC) 

WEC Analyst Estimates | MarketWatch

WEC SEC Filings 

FINRA Page: Bond Detail (prospectus linked)

Credit Ratings: A2/A-

YTM at Total Cost = 4.899%

Current Yield at TC = 3.3%, rounded up. 

This is my first purchase. 

In 9/2022, the parent company sold $500M in 5% SU notes maturing in 2025 and $400M in 5.15% notes maturing in 2027. Prospectus Fitch has a BBB+ rating on those bonds.  Fitch Rates WEC Energy Group, Inc.'s Senior Notes 'BBB+'

L. Bought 2 Spectra Energy LP 4.75% SU Maturing on 3/15/24 at a Total Cost of 99.275:

Spectra was acquired by Enbridge Inc. (ENB) 

I own ENB common shares. 

ENB SEC Filings 

ENB SEC Filed Shareholder Report for the Q/E 9/30/22 

ENB 10-Q for the Q/E 9/30/22 

Enbridge Inc. and Spectra Energy Partners, LP Complete Merger

FINRA Page: Bond Detail (prospectus linked)

Credit Ratings: Baa1/BBB+ 

Credit Ratings - Enbridge Inc.

YTM at Total Cost = 5.287%

Current Yield at TC = 4.7847%

M. Bought 1 Southwestern Public Service 3.3% First Mortgage Bond Maturing on 6/15/24 at a Total Cost of 97.494: 

Issuer: Wholly owned subsidiary of Xcel Energy Inc. (XEL)

XEL SEC Filings 

XEL SEC Filed Earnings Press Release for the Q/E 9/30/22 

Last Southwestern FM Bond Offering: May 2022

Prospectus 

Security: First Mortgage

Finra Page: Bond Detail (prospectus linked)

Credit Ratings: A3/A

YTM at Total Cost: 4.889%

Current Yield at TC = 3.3848%

I now own 2.  

N. Bought 1 US Bancorp 3.6% Junior Bond Maturing on 9/11/24 at a Total Cost of 97.199: 

Purchased 11/4/22. Discussed out of time order. 

Issuer: U.S. Bancorp  (USB) 

USB Analyst Estimates | MarketWatch

10-Q for the Q/E 9/30/22 

SEC Filed Earnings Press Release for the Q/E 9/30/22 (net income = $1.812B)

I have a small ball position in the common stock. 

FINRA Page: Bond Detail (prospectus linked)

Credit Ratings: A2/A

YTM at Total Cost: 5.212%

When I bought this bond, the 2 year treasury note was trading at a 4.69%.   

Current Yield at TC = 3.7037%

I will consider buying more 1 bond lots after price declines. I now own just 1. 

O. Bought 2 WP Carey 4.6% SU Maturing on 4/1/24 at a Total Cost of 98.665: 

Purchased 11/7/22. Discussed out of time order. 

Issuer: W. P. Carey Inc.  (WPC) - Industrial REIT 

WPC SEC Filings 

SEC Filed Earnings Press Release for the Q/E 9/30/22 and Supplemental 

10-Q for the Q/E 9/30/22

I own the common shares. 

FINRA Page: Bond Detail (prospectus linked)

Credit Ratings: Baa1/BBB

YTM at Total Cost: 5.605%

Current Yield at TC: 4.6622%

4. Treasuries-Secondary Market Purchases: $2,000

A. Bought 1 Treasury 2.75% Coupon Maturing on 2/15/24 at 98.0441: 

Purchased on 10/4/21. 

YTM at Total Cost = 4.238% 

Current Yield at TC = 2.8049%

I now own 5 bonds. 

B. Bought 1 Treasury 3.125% Coupon Maturing on 8/15/25 at 96.757: 

Purchased 10/7/22

I now own 2. 

YTM at Total Cost = 4.351%

Current Yield at TC = 3.23%

5. Treasuries-Auction Purchases: $15,000

A. Bought 10 Treasury Bills at 11/10/22 Auction at 99.7215: 

Investment Rate (coupon equivalent): 3.64%

B. Bought at 11/8/22 Auction Two 3 Year Treasury Notes at  99.7089: 

Coupon: 4.5%

YTM:  4.605%

U.S. 3 Year Treasury Note Overview | MarketWatch

C. Bought 3 Treasury Bills at 11/14/22 Auction: 

182 Day Bill

Matures 5/18/23

Investment Rate: 4.604%

6. Small Ball- Sells: 

A. Eliminated LMT - Sold 2+ Shares at $489.02: 

Quote: Lockheed Martin Corp.

LMT Analyst Estimates-MarketWatch

Website: Lockheed Martin Corporation

LMT SEC Filings

10-Q for the Q/E 9/30/22 

Last Discussed: Item # 1.M. Multiple Small Lot LMT Buys Between $334 Down to $322 (2/20/21 Post)

Profit Snapshot: +$364.41

Dividend: Quarterly at $2.8 per share, last raised from $2.6, effective for the 2021 4th quarter payment. 

LMT Dividend History | Nasdaq

Last Ex Dividend: 8/31/22

Last Earnings Report (Q/E 9/30/22): SEC Filed Press Release 

E.P.S. = $6.71 

Free Cash Flow = $2.7B

Revenues: $16.6B

Segment Results: 

2022 Outlook: 

B. Pared XOM Again- Sold 1 at $113.67: 

Quote: Exxon Mobil Corp.

XOM Analyst Estimates | MarketWatch

XOM SEC Filings

Last Discussed: Item # 6.N. Sold 1 XOM in Fidelity Taxable Account at $103.69 (11/1/22 Post) I discussed the last earnings report in that post. SEC Filed Press Release

Profit Snapshot: $77.57 (11/7/22 sale only)

New Average cost per share:  $35.67 (9 shares)

Snapshot Intraday on 11/7/22 after pare

Dividend: Quarterly at $.91 per share ($3.64 annually), increased from $.88 effective for the 2022 4th quarter payment.  

Exxon Mobil Corporation (XOM) Dividend History | Seeking Alpha

Yield at $35.67 = 10.2%

Last Ex Dividend: 11/15/22

C. Pared HRZN - Sold 5 at $13.32: 

Quote: Horizon Technology Finance Corp. (HZNC)

HRZN SEC Filings

Investment Category: Monthly Income Generation

2021 Annual Report (risk factor summary starts at page 27 and ends at page 63)

Website: Horizon Technology Finance

Profit Snapshot: +$7.4

Part of highest cost lot. 

Last Discussed: Item # 5.B. Added 5 HRZN in Schwab Taxable Account at $9.7 (10/18/22) 

New Average Cost per share this account:  $11.3 (20 shares)

Dividend: Monthly at $.11 per share (regular dividend), increased from $.10 effective for the December 2022 payment. HRZN will also pay a special distribution of $.04 per share which goes ex dividend on 11/16/22.  Horizon Technology Finance Announces 10% Increase in Monthly Distributions for January, February and March 2023 to a Total of $0.33 per Share and Special Distribution for December 2022 of $0.05 per Share 

HRZN Dividend History | Nasdaq

Yield at new AC = 11.68% (regular dividend only) 

Next Ex Dividend Date: Tomorrow, 11/16/22

Net Asset Value Per Share History: 

9/30/22:   $11.66

6/30/22:   $11.69

 3/31/22:    $11.68

12/31/21:    $11.56

12/31/20:   $11.02

 3/31/20:   $11.48 
12/31/19:    $11.83
12/31/18:    $11.64
12/31/17:    $11.72
12/31/16:    $12.09
12/31/15:    $13.85
12/31/14:    $14.36 10-K at page 54 
12/31/13:    $14.14
12/31/12:    $15.15
12/31/11:    $17.01

October 2010: IPO at $16, net of $14.88 to HRZN after underwriting discount: Prospectus 

Last Earnings Report (Q/E 9/30/22): Investors responded favorably to this report.  

NII per share: $.43

Consensus at $.35

Yield on Debt Portfolio =  15.9%

Held warrant and equity positions in 94 companies

Spillover Income = $.67 per share as of 9/30/22

HRZN Risk Assessments of Loans: 

"For the quarter ended September 30, 2022, net realized loss on investments was $8.6 million, or $0.33 per share, compared to a net realized gain on investments of $1.3 million, or $0.07 per share, for the quarter ended September 30, 2021."

Goal: Any profit on the shares + the dividend. 

D. Eliminated GPC - Sold 1 at $178.35: 

Quote: Genuine Parts Co.

Company website: Genuine Parts Company

GPC Analyst Estimates | MarketWatch

GPC SEC Filings

Genuine Parts Company Key Metrics | Reuters

My reasonable fair value range is $121-$146. So I will buy near the bottom of that range and sell at some point when the price goes over the top end.  

When establishing that range, I take into account the estimated E.P.S. for 2023, recent earnings growth, the dividend yield compared to alternative fixed coupon investments which is important to me, dividend growth taking into account my life expectancy, overall financial condition, and reliability of earnings growth. Then I make a judgment call. 

Profit Snapshot: $57.1

Last Discussed: Item # 2.L. Bought 1 GPC at $121.24 (3/24/22 Post) When I published that post, the E.P.S. estimate for 2022 was at $7.59; $8.14 in 2023; at $8.54 in 2024. As of 11/14/22, the E.P.S. estimates for 2022 was at $8.17; at $8.6 for 2023; and at $9.22 for 2024. 

Dividend: Quarterly at $.895 per share ($3.58 annually), last raised from $.815 per share effective for the 2022 4th quarter payment. 

GPC Dividend History | Nasdaq

Yield at Sales Price of $178.35: 2%

Yield at Purchase Price of $121.24:  2.95%

Last Ex Dividend: 9/1/22

Last Dividend Double: Takes about 10-11 years. The quarterly rate was at $.45 in 2011 and at $.495 in 2012. The dividend growth rate slowed in 2008 through 2010, going from $.39 to $.41. 

Last Earnings Report (Q/E 9/30/22): SEC Filing 

This report was released on 10/20/22 after the market close that day and was viewed favorably by investors. 

GPC  Stock Historical Prices & Data 

GAAP Net Income: $312M

GAAP E.P.S. = $2.2, up from $1.59 in the 2021 third quarter

Non-GAAP E.P.S. = $2.23

Non-GAAP E.P.S. excludes 3 cents per share of integration costs associated with the Kaman Distribution Group acquisition. 

Revenues: $5.7B

Raised Adjusted E.P.S. 2022 Guidance: 

E. Pared REYN - Sold 2 at $31.38- Schwab Taxable Account: 

Quote: Reynolds Consumer Products Inc. (REYN) 

REYN Analyst Estimates | MarketWatch

Brands (The main brands are Hefty garbage/trash bags, Reynolds Wrap/Foil; Presto storage bags and Freshlock zipper bags)

Profit Snapshot: $4.67

Sold highest cost lot using FIFO. 

Last Discussed: Item # 2.M. Added to REYN in Vanguard Taxable Account - Bought 2 at $26.78 (6/9/22 Post) 

New Average cost per share this account: $27.67 (20+ shares)

Dividend: Quarterly at $.23 per share ($.92 annually)

REYN Dividend History | Nasdaq

Yield  at new AC this Account:  3.32%

Last Ex Dividend Date: Today, 11/15/22

Last Earnings Report (Q/E 9/30/22): SEC Filed Press Release 

E.P.S. $.23, down from $.31 in the 2021 third quarter

Non-GAAP E.P.S. = $.24, down from $.34. 

Revenues: $938M

Released after this pare. Investors responded negatively to it, driving the price down -7.27% on 11/8/22. REYN Historical Prices 

While revenues increased by 7%, that was due to price increases. Volume was down. REYN benefited from dine at home trend created by the pandemic. Product sales volume "in many of our categories remains well above 2019 levels, driven by more cooking and working at home compared to prior to the pandemic." 

2022 4th Quarter and Year Guidance: 

The company expects to return to pre-pandemic profitability in 2023.  

I have a very large number of small  stock positions and REYN is just one of them. I view the stock as a weak hold based on recent earnings reports. This opinion may lead to further paring and a possible elimination. 

F. Eliminated GILD-Sold 10 +  at $82.99; 6+ at $83.01; 1 at $83.83:

Fidelity Account 10+ Shares

Schwab Account 6+  Shares 

Vanguard Account 1 Share

Quote: Gilead Sciences Inc. (GILD)

GILD  Analyst Estimates | MarketWatch

GILD SEC Filings

Pipeline | Gilead

Profit Snapshot Fidelity Account: $220  (11/8/22 sale only): 

Profit Snapshots Vanguard & Schwab Accounts: $174.47

Schwab 6+ Shares +$147.73

Vanguard 1 Share +$26.74

Last Discussed: I discussed GILD's third quarter report  in my last post and have nothing further to add here. Item # 6.C. (11/8/22 Post) 

G. Eliminated FNF - Sold 5 at $39.13 and 6 at $41.83: 

Quote: Fidelity National Financial Inc.

The share price popped after the first 5 lot sale, probably in response to the CPI report and lower interest rates. The assumption is that lower interest rates will revive the property title insurance business.

FNF SEC Filings 

10-Q for the Q/E 9/30/22 

Profit Snapshots: +$45.19

Last Discussed: Item # 2.B. Bought 5 FNF at $33.8 (12/5/2020 Post) 

Dividend: Quarterly at $.45 per share, last raised from $.44 orm 

Fidelity National Financial, Inc. (FNF) Dividend History | Seeking Alpha

Next Ex Dividend: 12/15/22

Last Earnings Report (Q/E 9/30/22): SEC Filing 

Property title revenue declined to $2.3B from $2.9B in the 2021 third quarter, which is understandable under the circumstances. More Y-O-Y declines in title insurance premiums can be reasonably expected as higher mortgage rates dampen both new and existing home sales. 

"FNF’s wholly-owned subsidiary F&G, a leading provider of insurance solutions serving retail annuity and life customers and funding agreement and pension risk transfer institutional clients" experienced a 7% decline in total gross sales to $2.9B. FNF is in the process of spinning off 15% of F&G to its shareholders.  

The result was an E.P.S. decline to $1.05 from $2.57 in the 2021 third quarter. 

Non-GAAP E.P.S. declined to $1.07 from $2.33. 

7. Small Ball - Buys:

A. Restarted D - Bought 2 at $60.42; 1 at $59.03; 2 at $58.42: 

Quote: Dominion Energy Inc

SEC Filings

Investor Relations | Dominion Energy

Closing Price 11/7/22: $62.94 -$4.19 or 6.24% (bought 2)

Closing Price 11/14/22: $57.96 - $3.7 or 6% (bought 3)

Yesterday's closing price was a new five year closing low. 

There was an intraday low at $57.79 on 3/23/2020. The S&P 500 closed that day at 2,237.40, down 67.52, and hit an intraday low at 2,191.86 which was the lowest point during the pandemic related meltdown.       

52 Week Range Through 11/14: $57.95-$88.78 

Dominion Energy, Inc. (D) Interactive Stock Chart - Yahoo Finance Waterfall formation starts near $85 in mid-August 2022 and shows no signs yet of stabilizing and forming a bottom. 

Dominion Energy, Inc. (D) Stock Historical Prices & Data - Yahoo Finance

Dominion Energy, Inc. (D) Interactive Stock Chart - Yahoo Finance

The downtrend IMO was not due to the better than expected third quarter earnings report released after the close on Friday 11/4/22, but to the uncertainty created by a strategic review announced with the earnings and multiple analyst downgrades on Monday 11/7 and 11/11. 

Broker Downgrades: I do not have access to these reports. 

UBS cut to neutral from buy and reduced its PT to $73 from $83

Credit Suisse cut PT to $69 from $76 (Schwab no longer has CS reports)

JPM downgrades to neutral from overweight and cuts PT to $76 from $83

BofA downgrades to underperform from buy, adjusts PT to $59 from $94. 

Goldman Sachs Upgrades to Neutral from sell, adjusts PT to $69 from $72. 

Morgan Stanley maintains equal weight rating and adjusts PT to $77 from $72. 

Last Elimination: Item # 2.K. Eliminated D - Sold 5 at $80.92; 5 at $81.95(3/10/22 Post)(profit snapshots = $71.42) 

Dividends: Quarterly at $.6675 per share ($2.67 annually), last raised from $.63 effective for the 2022 first quarter payment. The dividend rate was slashed from $.94 to $63 effective for the 2020 4th quarter payment. 

Dividends & Splits | Dominion Energy

The dividend slash was in response to selling Dominion Gas and canceling the Atlantic Pipeline project which resulted in a substantial loss. Dominion Energy Closes on Sale of Majority of Gas Transmission & Storage Assets - Nov 2, 2020;Dominion Energy and Duke Energy Cancel the Atlantic Coast Pipeline - Jul 5, 2020

While I am anticipating annual dividend increases, I may not live to see a higher quarterly rate than the pre-slash $.94 per share. 

The dividend history is consequently highly unfavorable. 

The current yield is not attractive enough in comparison to senior unsecured bonds, including those issued by Dominion and its subsidiary Virginia Electric that promise to pay par value at maturity; and cutting or eliminating  the coupon rate is not an option short of bankruptcy. Consequently, my position in the common stock will remain extremely small.  

Average cost per share = $59.34 (5 shares)

Using the current average E.P.S. estimate for 2023, which is currently $4.35, the P/E at $59.34 is 13.64. 

Yield at $59.34: 4.5% 

Next Ex Dividend: 12/1/22

Last Earnings Report (Q/E 9/30/22): Dominion Energy Announces Third-Quarter 2022 Earnings; Initiates Business Review - Nov 4, 2022

Operating Earnings (Non-GAAP): $944M

Non-GAAP E.P.S. = $1.11 

Consensus at $1.08

GAAP E.P.S. - $.91

"Differences between GAAP and operating earnings for the period include the mark-to-market impact of economic hedging activities, gains and losses on nuclear decommissioning trust funds, regulated asset retirements and other adjustments."

Guides 4th Q Non-GAAP E.P.S. to $.98-$1.13 and 2022 to $4.03-$4.18. 

Revenues: $4.386B

Dominion Energy, Inc (D) Q3 2022 Earnings Call Transcript | The Motley Fool

The strategic review may include the sale of the Dominion's 50% interest in the Cove Point LNG facility located in Lusby, Maryland.  

Analyst Reports Available to Schwab Customers: 

Morningstar (11/4/22): Keeps 5 star rating with a $82 FV estimate

S & P (11/4/22): 3 stars with a 12 month PT of $73, lowered from $89. 

Argus (9/23/22): Hold 

B. Bought Back 5 TECB at $27.11-Vanguard Taxable Account: 

Quote: iShares U.S. Tech Breakthrough Multisector ETF Overview

$27.11 is the lowest price that I have paid for this ETF. 

Sponsor's website: iShares U.S. Tech Breakthrough Multisector ETF

Expense Ratio: .4%

Last Eliminations: Item # 1.E. Eliminated TECB in Vanguard Taxable Account - Sold 5 at $42.80 and Item #1.F Eliminated TECB in Schwab Taxable Account - Sold 10 at $43.57 (12/10/21 Post)(profit snapshots = $179.84) 

Last Buy Discussions (all sold): Item # 4.E. Started TECB in Schwab Account-Bought 10 shares at an Average Cost per share of  $31.45 (8/20/20 Post); Item # 1.E. Started TECB in Fidelity Account-Bought 5 at $29.76 (8/1/20 Post)

Holdings as of 11/7/22: 180

Holdings Weighted at 1+% as of 11/7/22: 

Dividends: Paid quarterly and not relevant.

TECB Page at Morningstar (not rated)

YTD Total Return Through 11/7/22 = -35.53% Just enough to perk my interest a tiny bit of a tad. 

C. Added 5 DEI at $16: 

Quote: Douglas Emmett Inc. (DEI)

DEI owns and operates "18.1 million square feet of Class A office properties and 4,577 apartment units (excluding our residential development pipeline) in the premier coastal submarkets of Los Angeles and Honolulu."

DEI SEC Filings

10-Q for the Q/E 9/30/22 

Investment Category: Equity REIT Common and Preferred Stock Basket Strategy

Working my way up slowly to 100 shares. 

Last Discussed: Item # 6.M. Added to DEI- Bought 3 at $16.45 (11/1/22 Post) 

Last Substantive Discussion: Item # 4.L. Added to DEI - Bought 2 at $17.66; 3 at $17.19; 2 at $16.48 (10/11/22 Post) I discussed the second quarter earnings report in that post. 

New Average cost per share: $18.98 (25 shares)

Dividend: Quarterly at $.28 per share ($1.12 annually)

DEI Dividend History | Nasdaq

Yield at AC = 5.9%

Last Ex Dividend: 9/29/22

Last Earnings Report (Q/E 9/30/22): SEC Filing 

DEI has two primary problems IMO: (1) reliance on variable rate debt and (2) its office portfolio occupancy rates. 

FFO per share = $.51, up from $.48

AFFO per share = $.4364, up from $.42

Maintenance expenses for office and apartment properties will be the largest deduction from FFO. 

Occupancy:

During the pandemic, DEI could not evict non-paying tenants. Those tenants still had a legal obligation to pay rent. During the third quarter, DEI was able to recover 50,000 square feet from non-paying tenants and is pursuing its legal remedies to recover deferred rent payments. 

"Comparing the office leases we signed during the third quarter to the expiring leases for the same space, straight-line rents increased by 7.2% and cash rents decreased by 8.0%."

DEI estimate of net debt to pro forma enterprise value = 52%

Net Debt: $4.94B

2022 FFO Per Share Guidance: $2.03-$2.05

D. Added 2 FSK in Fidelity Taxable Account at $19.1: 

Quote:  FS KKR Capital Corp.-Disfavored by me BDC in a Disfavored by me Sector

1 for 4 reverse stock split in June 2020: FS KKR Capital Corp. Announces Effectiveness of Four-to-One Reverse Stock Split

Last Discussed: Item # 2.M. Pared FSK - Sold 9+ at $23.04 (3/24/22 Post) So I am not exactly throwing caution to the wind by buying back 2 of those 9 shares. 

Website: FS/KKR Advisor, LLC – One of the largest managers of BDCs

FSK SEC Filings

Management: External

Net Asset Value per share as of 9/30/22 = $25.3, down from $26.41 as of 6/30/22.

Average cost per share this account: $19.78 (71+ shares)

Dividend: Quarterly at $.61 per share (regular only)

Dividend information The next payment will include a 7 cent per share special dividend.  

Yield at AC = 12.34% (regular dividend only) 

Next Ex Dividend:  12/13/22.  

Last Earnings Report (Q/E 9/30/22):  SEC Filing 

NII per share as reported: $.76 

NII per share adjusted: $.73

Highlights: 

Goal: Any profit on the shares before ROC adjustments to the tax cost basis + the dividends. 

E. Added to SBRA in Schwab Taxable - Bought 1 at $11.83: 

Quote: Sabra Healthcare REIT Inc. - Primarily a Nursing Home/Senior Housing REIT, which are two out of favor property sectors.  

"As of September 30, 2022, Sabra’s investment portfolio included 407 real estate properties held for investment (consisting of (i) 270 Skilled Nursing/Transitional Care facilities, (ii) 52 Senior Housing communities (“Senior Housing - Leased”), (iii) 54 Senior Housing communities operated by third-party property managers pursuant to property management agreements (“Senior Housing - Managed”), (iv) 16 Behavioral Health facilities and (v) 15 Specialty Hospitals and Other facilities), one asset held for sale, one investment in a sales-type lease, 15 investments in loans receivable (consisting of two mortgage loans and 13 other loans), seven preferred equity investments and two investments in unconsolidated joint ventures. As of September 30, 2022, Sabra’s real estate properties held for investment included 41,053 beds/units, spread across the United States and Canada."

Average cost per share this account: $15.63 (71+ shares)

Dividend: Quarterly at $.30 per share 

I am currently reinvesting the dividend as a means to randomly lower my AC per share. 

Yield at AC = 7.68%

Next Ex Dividend: 11/16/22

Last Earnings Report (Q/E 9/30/22): 

SEC Filed Press Release and Supplemental 

SBRA offers 5 numbers: 

Net Income to AFFO Calculations: 

When calculating AFFO, there is no deduction from FFO for maintenance expenses which is appropriate IMO when none are paid. That normally would be case for a triple net lease where the tenant has that responsibility. 

SBRA is primarily a triple net lease REIT: 

Page 6 Supplemental 

Operating Statistics:

Top Ten Tenants:

Debt Maturities:

SU Debt rated Ba1/BBB- 

Fitch has a BBB- rating. Fitch Affirms Sabra Health Care REIT's IDR at 'BBB--Outlook Stable

I do not own any SBRA SU bonds. 

Maximum Position in this Account: 100 shares due to the assessment of the risk/reward balance. 

F. Added to BDN - Bought 3 at $6.53-Schwab Taxable Account: 

Quote: Brandywine Realty (BDN) - Office REIT, Currently an Extremely Disfavored Property Sector 

SEC Filings

10-Q for the Q/E 9/30/22 

Our Properties | Brandywine Realty Trust

Investment category: Equity REIT Common and Preferred Stock Basket Strategy

I mentioned earlier that I would not be buying more share in this account. Technically, 3 shares is a buy but not really. I am violating the First Law of Holes with this buy but will continue buying in 1 to 5 share lots nonetheless. My gut has informed me that analysts and investors have become too negative.  

Last Discussed: Item # 3.M. Added to BDN in Schwab Account - Bought 15 at $6.81 (10/4/22 Post) 

Last Substantive Buy Discussion: Item # 3.F. Added to BDN - Bought 5 at $8.93; 10 at $8.75; 15 at $8.58; 10 at $8.37 - Schwab Taxable Account (8/10/22 Post) I discussed the second quarter report in that post.  

Average cost per share = $8.31 (105+ shares)

Dividend: Quarterly at $.19 ($.76 annually) last raised from $.18 effective for the 2018 first quarter payment. The quarterly penny rate was slashed from $.44 paid in 2008 to $.10 per share effective for the 2009 second quarter payment. I doubt the quarterly dividend will ever return to $.44 per share.  

BDN Dividend History | Seeking Alpha

I am currently reinvesting the dividend based on valuation, dividend yield and dividend payout coverage with cash flow, and as a means to average down randomly. 

Yield at AC  = 9.15%

Yield at $6.53 = 11.64%

Last Ex Dividend: 10/5/22

Last Earnings Report (Q/E 9/30/22): SEC Filing 

While I do not have access to any analyst reports, I did note 2 price target downgrades in response to this earnings release: Citigroup cut PT to $6.5 from $7 and JPM cuts its PT to $10 from $11. 

FFO = $66.8M

FFO per share = $.36

BDN does not provide AFFO numbers which will be substantially below FFO for Office Reits due primarily to maintenance costs and the recognition in FFO of pretend revenues created by the straight line accounting convention. While including pretend revenue in FFO, noncash revenue is not available for distribution to shareholders. 

I would consequently take BDN's claim to a 52.8% dividend payout ratio based on its FFO calculation as misleading on the actual cash flow payout ratio: 

Dividend Payout Ratio Calculation

Some of those items are included in the 10-Q filing at  page 16 for the nine months ending on 9/30/22.  

Core Portfolio: 91.8% leased; 90.8% occupied 

Part of the problem is $700M in SU debt maturities in 2023-2024 and a credit facility based on a spread to SOFR.  

 Guidance: 

Last Elimination: Item # 2.F. Eliminated BDN - Sold 15+ at $13.51 in Schwab Account and 20 at $13.5 in Schwab Account  (1/7/22 Post)

Other Sell Discussions: Item # 1.K. Sold 1+ BDN at $13.75-All Shares Bought with Dividends in Fidelity Taxable (5/16/21 Post)($3.3); Item # 1.D. Sold 50 BDN at $12.9 in Schwab Taxable Account (3/27/21 Post)(profit snapshot = $7.72); Item # 2.B. Sold 101+ BDN at $15.33 (11/9/19 Post)(profit snapshot = $100.4); Item # 7 Sold 158+ BDN at $15.28 (5/24/14 Post)(profit snapshot = $72.31); Item # 2 Sold 100 BDN at $12.38-Roth IRA (profit snapshot = $100.5)

BDN Realized Gains to Date: $440.52

Goal: 2%+ annualized realized gain on the shares + the dividends 

G. Added to NOMD - Bought 2 at $13.12; 2 at $12.86: 

Quote: Nomad Foods Ltd.

NOMD Analyst Estimates | MarketWatch

Website: Home | Nomad Foods

NOMD SEC Filings (foreign company forms)

52 week range: $12.5 to $26.89

While I view NOMD as undervalued, I may be the only investor who has that opinion based on the chart. 

2 Year Chart Through 11/14/22: Bear Market starting in June 2021. 

Last Discussed: Item # 2.F. Added to NOMD- Bought 5 at $19; 5 at $18.49 Fidelity Taxable Account (5/12/22 Post) 

Average cost per share: $20.72

Dividend: None and none expected. 

Last Earnings Report (Q/E 9/30/22): 

SEC Filed Press Release 

Financial Information in Euros

1 EUR to USD - Euros to US Dollars Exchange Rate

Reported E.P.S. = €.47

Adjusted E.P.S. = €.52

The adjusted consensus was at €.43 per Fidelity 

Organic Revenues: +7.2% "comprised of a 3.4% decline in volume/mix offset by a 10.6% increase in price." Lower volume after significant increases in product prices is to be expected.  

"Gross margin increased 110 basis points to 29.1%, driven by higher pricing offsetting higher raw material costs across the business."

Reiterated 2022 Adjusted E.P.S. Guidance of €1.65 to €1.71 

Part of the share price decline this year is attributable to the USD rising in value against the Euro.  

H. Added to EAI in Vanguard Taxable Account- Bought 5 at $20.82: 

Quote: Entergy Arkansas 1st Mortgage Bonds 4.875% due 2066 (EAI)

I highlighted the maturity year in red just to emphasize the interest rate risk. 

I will not buy a $1K par value bond maturing in 2066, irrespective of the credit quality, since I am committing too much money in just 1 purchase. The exchange traded bond allows me to slice up purchases into small lots and then average down, thereby providing at least a measure of interest rate risk control before I hit a $1K outlay.  

Issuer: Wholly owned subsidiary of  Entergy Corp. (ETR) 

Investment Category: Income Generation with a First Mortgage Baby Bond, part of the  Exchange Traded Bond category. 

Working my way up slowly to 100 shares this account. 

Last Discussed: Item # 5.N. Added to EAI in Vanguard Taxable Account - Bought 5 at $22.44; 5 at $21.65 (10/25/22 Post) 

Security: Prospectus

First Mortgage attaching to substantially all assets

Par Value = $25 

Coupon: 4.875% 

Issue Optional Redemption: On or after 9/1/21 at par plus accrued and unpaid interest. Interest rate risk is asymmetric in favor of the issuer given the optional call date and the potential maturity date.  

Maturity: 9/1/2066, unless redeemed early at the issuer's option. 

Trades Flat (i.e. whoever owns the security on the ex interest date receives the entire quarterly interest payment)

Interest Paid Quarterly 

Credit Ratings: A/A2

I am not concerned about credit risk, even if this bond was a senior unsecured one. The first lien on substantially all assets simply provides an additional layer of protection in case that opinion proves wrong.  

Average Cost per share this Account = $22.82 (30 shares)

Yield at $22.82 AC = 5.34%

Next Ex Interest Date: 11/29/22

Last Sell Discussions: Item # 4.B. Sold 30 EAI at $24.7-Used Commission Free Trade (5/18/19 Post); Item # 4.B. Sold 30 EAI at $24.73-Used Commission Free Trade  (3/17/19 Post) 

EAI trading profits to date: $102.14

Goal: Interest + any profit on the bonds. 

Purchase Restriction this account: Up to 100 shares with each subsequent purchase required to be at the lowest price in the chain.  

Maximum Position All Accounts: 300 shares.

Small Ball Trading: 5 share lot buys. Will likely sell the highest cost lots when and if I can do so profitably. The highest cost lot in this account was a 10 share purchase  $24.64 on 4/13/2020. 

$1K Par Value FM: I currently own 3 Entergy Arkansas $1K par value first mortgage bonds. 

1 of the 3.7% FM Maturing on 6/1/24 

2 of the 3.5% FM Maturing on 4/1/26 I sold 1 in 2019 when the price went over par value. 

In 2019, I eliminated my position in the 3.05% FM maturing on 6/1/23 when the price went over the $1,000 par value.

The highest price for this bond was hit near 107 in May 2020. 

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 sale 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 my family members.