Economy:
Annual CPI slowed for the seventh consecutive month in January.
Annual CPI at 6.4%
Annual Core CPI at 5.6%
Allocation Shifts Discussed in this Post:
Treasury Auctions: +$7,000 in principal amount
Corporate Bonds: +$2,000 in principal amount
Individual Common Stocks: Net Outflow of -$3,230.8
(consisting of $3,498.6 in proceeds minus $267.8 in purchases)
Stock Funds: Net Outflow of -$693.14
Realized Gains Common Stocks/Stock Funds: +$1,442.91
Net Outflow Stocks/Stock Funds: -$3,923.94
2023 YTD Net Outflow Stocks/Stock Funds: -$25,465.11
The current FF rate and its likely increases are stimulative monetary policies for a large number of U.S. households, concentrated in the top 25%.
++++
Putin and His Servile Orcs:
Report says Russian government is operating network of camps where it has held thousands of Ukrainian children since start of war; Thousands of Ukrainian children forced into network of Russian camps, study finds
Russia is a state sponsor of child trafficking.
Maria Lvova-Belova, the Russian official at the center of alleged Ukrainian children scheme
There can be no doubt that Russia commits war crimes and crimes against humanity on a daily basis. Harris: US has formally determined Russia has committed crimes against humanity in Ukraine-The Hill
Another Russian has "fallen" out of window. Putin's top defence official dies after 160ft balcony fall in mystery death | Metro News
Putin Puts on a Brave Face over Vuhledar Disaster
Nearly Russia's entire army is in Ukraine, suffering '1st World War levels of attrition'
Russian Flash Drive Identifies Key Figures In Occupation Of Ukraine - YouTube
Putin Could Attack Other Countries If He Wins in Ukraine: Russia Experts
Incompetence and Torture in Occupied Ukraine - The Atlantic Russians routinely commit war crimes and crimes against humanity which includes torturing and murdering Ukrainian civilians. That is historically normal for them. In this article, Anne Applebaum shines a light on the barbaric actions routinely committed by Russian soldiers in formerly occupied Ukrainian cities and towns that have now been liberated by the Ukrainian army.
White House 'Deeply Concerned' About Putin's Reported Power Grab in Moldova
Putin, czar with no empire, needs military victory for his own survival - The Washington Post ("A couple in a Krasnodar restaurant were arrested, handcuffed and forced to the floor after being denounced to the police by an eavesdropper who heard them quietly bemoaning the war." This article also contains a link to Russian Orcs throwing an old lady off a bus, back first, after she correctly pointed out the government's failure to provide its soldiers with adequate boots, Twitter)
Russian student under house arrest for an Instagram story - BBC News - YouTube She was turned in by her college acquaintances who had read her social media posts and viewed themselves as Russian "patriots". It is not surprising that a totalitarian state punishes criticism severely. That was part of the authoritarian playbook under Stalin, Hitler and other dictators similar to Putin throughout world history. What strikes me about this video and hundreds of others that I have watched is the how Russians conflate patriotism with (1) severe punishment of free speech, (2) Russia's effort to erase an independent and democratic Ukraine through military conquest; (3) Russia's ongoing genocide of Ukrainians; and (4) Russia's routine commission of war crimes and crimes against humanity.
Hear Russian's chilling final message to wife after fighting in Ukraine - YouTube The Russian told his wife that he was about to be taken from his hospital bed and executed for "poor performance" during a battle that killed most of his comrades.
Russian soldier who fled Russian army speaks to CNN - YouTube
A 21 year old university student, Danuta Perednya, reposted a message criticizing Russian and Belarus dictators and received a 6 1/2 year prison sentence for that "crime". Student sentenced to 6.5 years in Belarus for reposting Putin and Lukashenko criticism
Anne Applebaum on Ukraine: One Year into the War - YouTube Worth the time viewing.
Russians abandon wartime Russia in historic exodus - The Washington Post (1M have fled and Putin refers to them as "scum") Sometimes, the best that a person can do for his family and future generations is to leave a place where opportunities are either non-existent or unattractive for almost everyone. Russia has been and will continue to be one of those places.
I have recently watched several episodes of "Finding Your Roots", a PBS documentary series, where the celebrity was unaware that their Jewish ancestors immigrated to the U.S. from what is known as the Pale of Settlement prior to WWII which included parts of the Russian Empire. Related family members who stayed were killed by the Nazis or Stalin. Some brief excerpts are available for viewing at Ancestry - YouTube. An example is the one involving David Duchovny. The Perilous Story of David Duchovny's Family Finally Revealed | Finding Your Roots | Ancestry® - YouTube After viewing several of the YouTube video clips, I bought several seasons at Amazon including the current one which is Season 9.
+++
Trump and His Party:
Fox Producer Abby Grossberg to Fox "news" Maria Bartiromo: "To be honest, our audience doesn’t want to hear about a peaceful transition.” The "journalist" Bartiromo replied "Yes, agree".
Fox News stars and executives privately trashed Trump's election fraud claims, court document reveals Publicly Trump's Fox "news" propagandists advanced those false election fraud claims to the Trumpsters.
Maybe Tucker Carlson Meant “Demonic Force” in a Nice Way When He Likened Trump to Satan
Fox News has been exposed as a dishonest organization terrified of its own audience
Election fraud claims on Fox News vs. what was said behind the scenes-NPR
Why Did Fox News Lie to Its Viewers? - The Atlantic
Brian Stelter: I Never Truly Understood Fox News Until Now - The Atlantic
Marjorie Taylor Greene (R-GA) Makes Absolutely Baffling 9/11 Claim In Bonkers New Video
West Virginia reporter's ouster exposed political pressure on local public media-NPR; West Virginia reporter's ouster exposed political pressure on local public media-NPR (transcript of interview with reporter) It is important to monitor how republican politicians are furthering their creeping authoritarian agenda, which in this particular case includes control over a formerly independent news media organization that provided accurate and unflattering information about those who govern. Jim Justice (R-WV) recently appointed his top public relations aide, Butch Antolini, to head West Virginia's Public Broadcasting.
The most recent model for growing authoritarianism in a democracy is Hungary.What Viktor Orbán's CPAC appearance tells us about Trump, GOP; Hungary: Freedom in the World 2022 Country Report | Freedom House; Hungary’s authoritarian leader is no gift to US conservatives | Human Rights Watch; Does Hungary Offer a Glimpse of Our Authoritarian Future? | The New Yorker; How the American right became aligned with Hungary and its authoritarian leader-NPR; The Right’s Rising Authoritarian Ally - The Atlantic
Andy Ogles (R-TN) Embellished Resumé, Much Like Republican George Santos; Economist, cop, sex crimes expert? The stories of Congressman Andy Ogles Ogles claims the liberal media is out to get him. Ogles is now my congressional representative, having won the 2022 race for the recently gerrymandered 5th Tennessee Congressional District.
The republicans in the Tennessee state legislature decided that Nashville would no longer be allowed to have a Democrat as their representative.
The incumbent Democrat won the 2020 election in that District with 100% of the vote but retired since there was no way he could win that district after it was gerrymandered by the republican state legislature.
The democrats in Nashville were gerrymandered into 3 newly drawn congressional districts that included heavily republican rural areas and small towns, including towns as far away as Cookeville in east Tennessee. (see my discussion of what the anti-democracy party did in Tennessee in my 11/15/22 Post, scrolling to "Trump and His Party") Nashville is now represented by 3 far right Trumpsters.
The republicans have not yet figured a way to gerrymander Memphis/Shelby County that would eliminate the last Democrat representative in Congress. There are just too many African Americans in Memphis who vote for Democrats.
+++
1. Eliminated SHEL - Sold 10 at $60.99:
Quote: Shell PLC ADR (SHEL)
Shell PLC ADR Analyst Estimates | MarketWatch
SHEL SEC Filings (foreign company forms)
Proceeds: $609.92
Profit Snapshot: $363.88
Last Earnings Report (Q/E 12/31/22): SEC Filing
E.P.S. = $1.47, down from $1.49
Adjusted E.P.S. = $1.39, up from $.83
"Fourth quarter 2022 income attributable to Shell plc shareholders also included net gains of $4.2 billion due to the fair value accounting of commodity derivatives, partly offset by charges of $1.9 billion related to the EU solidarity contribution and the UK Energy Profits Levy, and impairment charges of $0.7 billion. These gains and losses are included in identified items amounting to a net gain of $1.5 billion in the quarter."
Other Sell Discussions:
Item # 5. Pared SHEL in Schwab Account - Sold All Shares with a Cost Basis over $50 at $58.34 (4/28/22 Post)(profit snapshot = $84.89)
Item #1.P. Pared RDS/B in Schwab Account - Sold 5 at $49.36 (10/22/21 Post)(profit snapshot = $16.76)
Item # 3.D. Sold All Remaining Shares Purchased with Dividends in Fidelity Account at $40.14 (10/8/21 Post)(profit snapshot = $2.39)
Item # 2 Eliminated Royal Dutch Shell - Sold 52+ at RDS/A at $70.85 and 51 at $70.83 LIMIN. (1/28/14 Post)(profit snapshots = $325.89)
2. Small Ball Sells:
Baseball Analogy: Small ball (baseball) - Wikipedia
Small Ball Rules: Primarily a risk reduction trading technique.
(2) Purchases are made in small lots, using commission-free trades;
(3) On price pops, I will consider selling my highest cost shares at a profit, no matter how small;
(4) Some positions will be eliminated altogether on price pops when the goal is achieved;
The corollary is to buy the dips, particularly during extreme volatility events that would be associated with major declines in stocks. I may keep some high yielding dividend stocks bought after major price declines, similar in depth to March 2020.
Another aspect is selling fractional shares bought with dividends in order to harvest the original dividend amount plus a small profit on the shares. Prior to the most recent downdraft last year, I was doing that regularly having turned off the dividend reinvestment option in virtually all stocks that I own. I am now selectively turning back on the dividend reinvestment option based on valuation and yields. Generally, if I am willing to buy a dividend stock now through a market purchase, I will consider reinvesting the dividend. Conversely, if I am not willing to buy shares, I will likely turn off the dividend reinvestment option.
The primary known threat to the stock market are problematic inflation continuing for longer than currently anticipated that has several adverse impacts on the economy and corporate profits.
A. Eliminated ETN - Sold 1 at $170.1:
Quote: Eaton Corp. PLC (ETN)
ETN Analyst Estimates | MarketWatch
Proceeds: $170.09
Profit Snapshot: +$41.73
Last Discussed: Item # 2.H. Bought 1 ETN at $128.36 (7/13/22 Post)
Dividend: Quarterly at $.81 per share, last raised from $.76 effective for the 2022 first quarter payment.
Last Ex Dividend: 11/9/22
Last Earnings Report (Q/E 12/31/22): SEC Filed Press Release
E.P.S. = $1.8
Non-GAAP E.P.S. = $2.04
Reconciliation GAAP to Non-GAAP:
Revenues: $5.384B
Free Cash Flow = $977M
Forward Guidance: 2023 Adjusted E.P.S. $8.04-$8.44
B. Eliminated SCM in Vanguard Taxable Account - Sold 30 at $15.36:
Quote: Stellus Capital Investment Corp. (SCM)
Externally managed BDC.
Proceeds: $460.79
Investment Category: Monthly Income Generation
Website: Stellus Capital Management
10-Q for the Q/E 9/30/22 (summary of investments starts at page 5)
2021 Annual Report (risk summary starts at page 33 and ends at page 68)
Profit Snapshot: +$239.84
Average per share cost at $7.365
Last Substantive Buy Discussions: Item # 1.E. Bought 5 SCM at $7.41 in Fidelity Account (8/15/20 Post); Item # 3.J. Added 10 SCM at $7.85; 5 at $7.65; 10 at $7.5 (7/18/20 Post); Item # 2.B. Added 10 SCM at $7.8; 2 at $6.26, 3 at $5.30; 5 at $7.53 (5/9/20 Post)
Dividend: Monthly at $.1333 per share
2022 Tax Status of Dividends: No ROC
Next Ex Dividend: 2/27/23
Net asset value per share history:
9/30/22: $14.18 10-Q for the Q/E 9/30/22 at page 1
6/30/22: $14.32 10-Q for the Q/E 6/30/22
12/31/21: $14.61
9/30/21: $14.15
6/30/21: $14.07
3/31/21: $14.03 10-Q for the Q/E 3/31/21 at page 3
12/31/20: $14.03 10-K at page 74
12/31/19: $14.14
12/31/18: $14.09
12/31/17: $13.81
12/31/16 $13.69
12/31/15: $13.19
12/31/14: $13.94
12/31/13: $14.54
November 2012: IPO at $15 ($14.46 after underwriters discount)
Last Earnings Report (Q/E 9/30/22):
NII per share = $.37
Core NII per share = $.35
"Core net investment income, as presented, excludes the impact of capital gains incentive fees and income taxes, the majority of which are excise taxes . . . . The capital gains incentive fee had a reversal of ($0.6) million for the three months ended September 30, 2022 due to the increase in unrealized losses, net of realized gains over the quarter . . . The income tax expense accrual of $0.4 million for the three months ended September 30, 2022 was accrued based on estimates of undistributed taxable income, which was generated largely from net income. Core net investment income, which is a non-U.S. GAAP measure that excludes the capital gains incentive fee and income tax expense accruals, for the three months ended September 30, 2022 was $6.9 million, or $0.35 per share; and for the three months ended September 30, 2021 was $6.0 million, or $0.31 per share."
Net Realized Gains per share: $.08
Net Asset Value per share = $14.18
Company Risk Assessment of Loans:
 |
| Page 59 10-Q |
"As of September 30, 2022, we had loans to four portfolio companies that were on non-accrual status, which represented approximately 5.5% of our loan portfolio at cost and 2.5% at fair value." Page 59 10-Q.
Prior Sell Discussions:
Item # 3.C. Pared SCM in Fidelity Account - Sold 5 at $13.89 (8/23/22 Post)(profit snapshot = $28.69); Item 2.L. Pared SCM in Fidelity Taxable Account - Sold 5 at $14 (12/3/21 Post)(profit snapshot = $30.75); Item # 2.B. Sold 8.558 SCM shares at $13.19 (8/27/21 Post)(profit snapshot = $45.73); Item # 2.G. Pared SCM in Vanguard Taxable-Sold 10 at $13.2 (6/19/21 Post)(profit snapshot = $11.33); Item # 1.C. Pared SCM in Fidelity Taxable -Sold 13 at $12.46 and 13+ at $13.25 (4/17/21 Post)(profit snapshot = $69.04); Item # 1.F. Pared SCM in Fidelity Taxable-Sold 20 at $11.08 and Item #1.G. Pared SCM in Vanguard Taxable-Sold 20 at $11.17 (12/19/20 Post)(profit snapshots = $14.23); Item # 3 Sold 50 SCM at $13.72 (9/21/19 Post)(eliminating position as of that date; profit snapshot = $3.75); Item # 1.I. Sold 20 SCM at $7.61 (8/22/20 Post)(contains snapshots of prior trades; profit snapshot = $10.84); Item # 1.B. Sold 32+ SCM at $14.22-Used Commission Free Trade (2/2/19 Post)(profit snapshot = $78.09); Item # 1.A. Sold Highest Cost Lot-50 Shares at $12.63 (5/3/18 Post)(profit snapshot = $34.24); Item 2.B. Sold 100 SCM at $14.23 (2/27/17 Post)(profit snapshot=$285.96); Item # 2 Sold 100 SCM at $13.02 (1/12/17 Post)(profit snapshot= $141.96)
Goal: Any total return in excess of the dividends paid.
C. Eliminated SCM in Schwab Taxable Account - Sold 10 at $15.55:
See Item # 2.B above
Profit Snapshot = $70.2
For my taxable accounts, I currently own 35 SCM shares in 1 account.
Fidelity Account: AC per share at $7.15 (35 shares)
 |
| Price as 2/17/23 Close/Unrealized Gain at $298.85 |
Yield at $7.15 = 22.37%
The preceding snapshot is an example of trading down to the lowest priced shares, buying after major price declines and then keeping a few shares based on the dividend yield notwithstanding my general robust trading strategy now.
SCM realized gains to date: $1,064.65
D. Eliminated COLB in Vanguard Taxable Account - Sold 15 at $31.86:
Quote: Columbia Banking System Inc.
Proceeds: $477.89
Investment Category: Regional Bank Basket Strategy
COLB Analyst Estimates | MarketWatch
Profit Snapshot = $41.56
Last Discussed: Item # 3.B. Added 5 COLB in Vanguard Taxable Account at $27.5 (1/30/23 Post) I discussed the last earnings report in that post and have nothing further to add here. SEC Filed Earnings Press Release for the Q/E 12/31/22
E. Eliminated FDUS in Vanguard Taxable Account - Sold 15 at $20.5:
Quote: Fidus Investment Corp. - Externally Managed BDC
Proceeds: $307.87
2021 Annual Report (risk factor summary starts at page 28 and ends at page 55)
10-Q for the Q/E 9/30/22 (summary of investments starts at page 7)
5 year chart as of 2/17/23: Typical BDC crash and burn in March 2020
Profit Snapshot: $187.76 Average cost per share at $8
Last Discussed: Item #1.K. Pared FDUS Again - Sold 3 at $17.5 - Schwab Taxable Account (10/15/21 Post)(profit snapshot = $14.93) This post also contains snapshots of prior round trip trades.
Net Asset Value per share history:
9/30/22: $19.41
12/31/21: $19.96
6/30/21: $17.57
12/31/20: $16.81
9/30/20: $15.94
12/31/19: $16.85
9/30/19: $16.47 10-Q
12/30/18: $16.47
9/30/18: $16.41
3/30/18 $16.28
12/31/17 $16.05
12/31/16 $15.76
12/31/15 $15.17
12/31/14 $15.16
12/31/13 $15.35
12/21/12 $15.32
IPO at $15 June 2011
Spillover income as of 9/30/22: $2.86 per share
 |
| Page 45, 10-Q |
FDUS Realized Gains to Date: $452.3
GOAL: Any total return before any ROC adjustment to the tax cost basis in excess of the dividend payments.
Remaining Taxable Account Positions:
Schwab: 30+ shares with an AC at $8.47 per share, a 56.36% discount to last reported net asset value per share of $19.41 as of 9/30/22.
 |
| Price as of 2/17/23 Close/Unrealized gain at $374.67 |
Fidelity: 20+ shares with an AC at $7.98 per share, a 58.89% discount to last reported net asset value per share.
 |
| Price as of 2/17/23 Close |
Yield at $7.98 Regular Dividend Only = 19.55%
F. Eliminated GNL in Vanguard Taxable Account - Sold 28 at $14.61:
Quote: Global Net Lease Inc. -Externally Managed Net Lease REIT
Proceeds: $409.07
Investment Category: Equity REIT Common and Preferred Stock Basket Strategy
As previously discussed, GNL is highly disfavored by investors who count, a fact established by the dividend yield and long term chart. I would give the external managers an "F" grade based primarily on their excessive compensation.
5 year chart as of 2/17/23:
Website: Overview | GNL
As of Sept. 30, 2022, Global Net Lease Inc. owned 310 properties consisting of 39.5 million rentable square feet.
Property Classifications:
"66% U.S. and Canada, 34% Europe (based on annualized straight-line rent)"
Profit Snapshot: $148.11
Last Discussed: Item # 1. Added 1000 GNL at $16.15- Fidelity Taxable Account (10/8/21 Post) I still own those shares.
Last Sell Discussions: Item # 2.E Sold Highest Cost 10+ Shares in Fidelity Account at $19.91 (6/25/21 Post); Item # 1.J. Pared GNL in Fidelity Taxable- Sold 20 GNL at $19.49 (5/16/21 Post)
Other Buy Discussion: Item # 4.A. Added 5 GNL at $17.65; 5 at $16.87, 5 at $16.3; 5 at $14.6; 5 at $14; 10 at $13.5; 5 at $12.94; 2 at $12.66; 2 at $12.1; 2 at $11; 1 at 10.1; 4 at $11.48 and 2 at $10.8 (4/4/20 Post)
Dividend: Quarterly at $.40 per share
Global Net Lease (GNL) Dividend History | Nasdaq
Last Ex Dividend: 1/12/23
Last Earnings Report (Q/E 9/30/22): The 2022 4th quarter report is scheduled for release on 2/23.
SEC Filed Press Release and SEC Filed Supplemental
Core FFO per share = $.47
AFFO per share = $.40, down from $.44 in the 2021 third quarter
With AFFO at the quarterly dividend rate, a dividend cut is possible. It is also worrisome that AFFO declined Y-O-Y from $.44.
Net Income to AFFO Calculation:
98.6% Leased with average weighted lease term of 8.1 years.
"As of September 30, 2022, the percentage of debt that is fixed rate (including variable rate debt fixed with swaps) was 74.8% compared to 93.9% as of September 30, 2021. The Company’s total combined debt had a weighted average interest rate of 3.5% resulting in an interest coverage ratio of 3.3 times. Weighted-average debt maturity was 4.2 years as of September 30, 2022"
Interest expense will be going up in 2023.
Legal expenses will rise in 2023 as the external manager fights off a proxy challenge. Proxy Statement from Blackwells Capital and related entities; Blackwells Capital Announces Lawsuit Against Global Net; AR Global’s GNL Files Countersuit Against Blackwells - The DI Wire In my opinion, a court decision that allows a vote will be a positive for GNL shareholders.
If a court allows the alternative proxy statement to be voted on, I will vote for Blackwells director nominees and its bylaw amendments that will make it easier to get rid of the external manager.
Goal: Total return before any ROC adjustment to the tax cost basis + the dividend.
A net lease does not require much involvement by the property owner once the lease is signed. The tenant generally pays for routine maintenance, insurance and property taxes. Yet GNL paid the external manager $10.88M in fees during the 2022 third quarter or 11.75% of revenues which is of course outrageous:
 |
| Page 33, 10-Q |
In addition, the officers installed by the external manager receive share based compensation. Page 14, 10-Q.
The rise in interest and other expenses that I expect in 2023 will cause IMO AFFO per share to decline below the quarterly dividend. Without a reduction in management fees, which will not happen since the external management company is obviously excessively greedy, a significant dividend cut would be prudent but may not happen for as long as the external manager is under threat of being replaced.
I intend at some point to liquidate my 20+ GNL position held in my Schwab account as part of my ongoing house cleaning of duplicate positions. The average cost per share is $12.04. That may happen this week.
That will leave me with 1,325+ shares held in my Fidelity account where I am currently reinvesting the dividend.
 |
| Price as of 2/17/23 close/Unrealized loss at $1,203 |
I intend to sell at least 500 shares of the 1000 shares purchased at $16.15 when and if the price goes over $16.5.
Since buying that 1000 share lot on 10/1/21, I have acquired 206+ shares through dividend reinvestment at a weighted average cost of $13.87 per share.
I will probably liquidate the higher cost shares bought with dividends (price ranges between $15.03-$16.17) when I can profitably do so. The general idea is to capture a total return in excess of the dividend for those shares.
The lowest cost lot bought with dividends was 46+ shares purchased at $10.64, which I will keep.
GNL Realized Gains to Date: $277.68
G. Eliminated GMRE in Vanguard Taxable Account - Sold 20 at GMRE:
Quote: Global Medical REIT Inc. (GMRE)
Proceeds: $221.29
Management: Internal
Website: Global Medical REIT
Investment Category: Equity REIT Common and Preferred Stock Basket Strategy
Profit Snapshot: +$33.87
Last Discussed: Item # 2.E. Sold 15 GMRE at $10.46+ in Schwab Account (1/30/23 Post)(profit snapshot = $3.39) I discussed the last earnings report in that post and have nothing substantive to add here. SEC Filed Earnings Press Release for the Q/E 9/30/22 and SEC Filed Supplemental
Last Buy Discussion: Item # 4.B. Added to GMRE in Schwab Taxable Account - Bought 5 at $8.64; 5 at $7.93; 5 at $7.55; 5 at $7.3 (11/11/2022 Post) I still own those shares.
Dividend: Quarterly at $.21 per share
Last Ex Dividend: 12/21/22 (owned as of)
Remaining Taxable Account Positions: 46+ shares
Fidelity Account: 15 shares with a $7.72 AC per share.
As part of my ongoing house cleaning, I will sell those shares soon which will leave me with a small position in my Schwab account.
Schwab Account: 31+ shares with a $8.36 AC per share
 |
| Price as of 2/17/23 Close |
GMRE Realized Gains to Date: $507.2
Other Sell Discussions: Item # 1.B. Eliminated GMRE - Sold 40 at $11.25 (6/6/20 Post)(profit snapshot = $87.86); Item # 4.A. Eliminated GMRE-Sold 98+ at $9.41 (11/28/18 Post)(profit snapshot = $159.1); Item # 1.B. Sold 10 GMRE at $11.22 (4/18/20 Post)(profit snapshot = $12.07); Item # 3.C. Sold 50 GMRE at $10.01 (5/23/2017 Post)(profit snapshot = $82.54); South Gent's Comment Blog # 7: Eliminated GMRE (12/17/2016)(discussing realized gains from several trades)
I do not have access to any analyst reports.
H. Eliminated DOV - Sold 2 at $155.71:
Quote: Dover Corp. (DOV)
Proceeds: $311.41
DOV Analyst Estimates | MarketWatch
3 year Financial Data:
 |
| P. 30, Annual Report |
Profit Snapshot: +$69.73
Last Discussed: Item # 1.B. Added 1 DOV at $119.4 (7/20/22 Post); Item # 2.I. Bought 1 DOV at $122.28 (7/13/22 Post)
Dividend: Quarterly at $.51 per share
Next Ex Dividend: 2/27/23
Yield at $155.71 = 1.3%, viewed as unsatisfactory given my investment objectives and yields provided by credit risk free investments.
Last Earnings Report (Q/E 12/31/22): SEC Filed Press Release
GAAP E.P.S. = $1.87
Adjusted E.P.S. = $2.16
GAAP to Non-GAAP:
Analyst Reports (available to Schwab customers):
Morningstar (2/1/23): 4 stars with a fair value of $174 raised from $171, narrow economic moat.
S&P (2/9/23): 4 stars with a 12 month PT of $160, raised from $155.
I. Eliminated FIVG in Vanguard Taxable Account - Sold 13 at $33.45:
Quote: FIVG | Defiance Next Gen Connectivity ETF Overview
Sponsor's website: The First 5G ETF - FIVG
Expense Ratio: .3%
Proceeds: $434.84
Profit Snapshot: +$59.81
I am keeping 5 shares owned in my Fidelity account:
 |
| AC per share at $28.73/Price as of 2/17/23 Close |
Future purchases will be limited to this account and must reduce my AC per share.
Last Discussed: Item # 1.C. Sold 3 FIVG in Fidelity Account at $38.08 (10/15/21 Post)(profit snapshot = $25.46) Item # 2.A. Sold 5 FIVG at $38.83-Schwab Taxable (profit snapshot = $58.16)
Last Buy Discussions: Item # 1.D. Added to FIVG in Vanguard Taxable-Bought 2 at $28.16; 2 at $27.78 (10/3/2020 Post); Item #3.D. Started FIVG in Vanguard Account-Bought 8 shares at an average cost of $29.44 (7/29/20 Post); Item # 2.A. Started FIVG in Schwab Taxable Account- Bought 5 at $27.6 (8/15/20 Post)
Morningstar Page: Currently rated 5 stars
Dividend: Quarterly at a variable rate
Last 4 Dividends: $.488 per share
Yield at $33.45 = 1.45% (computed using the last 4 dividends)
Maximum Position: 20 shares given the low dividend yield and valuations of several stocks owned by this fund.
FIVG Realized Gains to Date: $143.43 (21 shares)
J. Pared HBAN in Fidelity Taxable Account - Sold 10 at $15.35:
Quote: Huntington Bancshares Inc. (HBAN)
Proceeds: $153.56
Investment Category:
Profit Snapshot: $37.56
I sold my highest cost lot using FIFO accounting.
Average cost per share this account before pare: $9.22
Average cost per share after pare this account: $8.75 (50+ shares)
 |
| Snapshot Intraday on 2/15/23 after pare |
Dividend: Quarterly at $.16 per share
Yield at New AC per share: 7.31%
Next Ex Dividend: 3/17/2023
Last Earnings Report (Q/E 12/31/22): SEC Filed Press Release
Comparisons are to the 2021 4th quarter.
Net Income: $645M, up from $401M
GAAP E.P.S. = $.42, up from $.26
Non-GAAP E.P.S. = $.43
Consensus at $.41
NIM = 3.52%, up from 2.85%
Efficiency Ratio: 54%, down from 73% (down is good)
NPL Ratio: .48%, down from .64%
Charge off ratio: .17%, up from .12%
ROA: 1.41%, up from .92%
ROE: 16%, up from 8.7%
ROTE: 26%, up from 13.2%
Tangible Book Value per share: $6.82
As with other regional banks, HBAN's 2022 4th quarter non-performing loans and charge offs are not consistent with recessionary conditions and are in line, or below, what I would normally expect during an economic expansion.
Some Sell Discussions: Item # 3.C. Pared HBAN - Sold Highest Cost 10 Shares at $16.22 (2/24/22 Post); Item #1.A. Pared HBAN in Fidelity Account- Sold 50 at $14.6 and 20 at $15 and Item #1.B. Sold 4 HBAN in Vanguard Account at $14.6 (1/31/21 Post); Item # 5.B Sold 51+ HBAN at $14.5 (9/28/19 Post)(profit snapshot = $52.58); Item # 5.A. Sold 104+ HBAN at $14.65 and 102+ at $14.57 (8/17/19 Post)(profit snapshots = $142.62); Item # 3.A. Sold 100 HBAN at $16.12 (2/3/18 Post)(profit snapshot = $254.75); Sold 50 HBAN at $9.53 (10/17/14 Post)(profit snapshot = $275.68); Item # 3 Sold 90 HBAN at $5.83 (9/29/2010 Post)(lots bought at $4.27 and $3.7)
As part of my house cleaning endeavor, I have eliminated my HBAN positions in other taxable accounts as discussed below.
K. Eliminated HBAN in Vanguard Taxable Account - Sold 10 at $15.25:
See Item # 2.I. above
Proceeds: $152.50
Profit Snapshot: $21.95
L. Eliminated HBAN in Schwab Taxable Account - Sold 10 at $15.37:
See Item # 2.I. above.
Proceeds: $153.7
Profit Snapshot: +$78.1
HBAN Realized Gains to date: $1,156.28 (currently at # 17 in the regional bank stock basket strategy)
Quote: First Trust Water ETF Overview
Sponsor's website: First Trust Water ETF (FIW)
First Trust Water ETF (FIW)-Morningstar (currently rated 5 stars)
Proceeds: $258.3
Profit Snapshot: +$32.56
Last Discussed: Item # 5.O. Added to FIW - Bought 1 at $72.74 (10/25/22 Post)
Dividends: Quarterly at a variable rate.
I am in the process of eliminating several small ball positions that have low or no dividend yields.
N. Pared TD - Sold 1 at $70.54:
Quotes:
USDs: Toronto-Dominion Bank (U.S.: NYSE)
CADs: Toronto-Dominion Bank (Canada: Toronto)
Canadian Dollar to US Dollar Exchange Rates Chart | Xe
SEC Filings (foreign company forms)
Proceeds: $70.53
Profit Snapshot: +$16.25
AC per share before pare: $51.16 (36 shares)
AC per share after pare: $51.08 (35 shares)
 |
| Snapshot Intraday on 2/14/23 after pare |
Dividend: Quarterly at C$.95 per share (C$3.8 annually)
Yield: Will vary with the CAD/USD exchange rate.
Assuming a constant CAD/USD of .75, near where the conversion is now, the current C$3.8 annual dividend converts into US$2.85 per share, creating before taxes a 5.58% dividend yield at US$51.08 constant total cost.
When TD is owned by a U.S. citizen in a taxable account, Canada will collect a 15% withholding tax. Recovery of that tax depends on the U.S. foreign tax credit rules.
Historical USD Dividends: The Toronto-Dominion Bank (TD) Dividend History | Seeking Alpha
Last Ex Dividend: 1/5/23
Last Earnings Report (F/Q ending 10/31/22): SEC Filed Press Release This is TD's 4th fiscal quarter.
All amounts are in millions of CADs except as noted:
GAAP per share at C$3.62
Non-GAAP per share at C$2.18
GAAP to Non-GAAP Reconciliation:
TD has not yet closed on its acquisition of First Horizon (FHN). I executed a successful arbitrage on FHN shares and no longer have a position. Excluding FHN, TD has about 35% of its revenues generated from U.S. operations and the remainder from Canada.
NIM Canadian Retail Banking: 2.7%, up from 2.48 in the 2021 4th fiscal quarter
NIM U.S. Retail Banking: 3.13%, up from 2.21%
Prior Sell Discussions: Item # 2.H. Pared TD-Sold 2+ shares at $70.97 (5/28/21 Post)(profit snapshot +$52.81, relatively low cost shares bought with dividends); Item # 2..N. Pared TD-Sold 1 at $60.54 (3/6/21 Post)(profit snapshot = $6.25); Item # 3.J. Sold 2 TD at $58.39 (1/31/21 Post)(profit snapshot = $6.99); Item # 1 Eliminated TD-Sold 53+ Shares at $58.31 (3/19/18 Post)(profit snapshot +$910.82); Item 4.A. Sold 54+ TD at $56.97 (11/4/17 Post)(profit snapshot +$718.78)-Dividend Growth And Large Cap Valuation Strategies: Bought Toronto Dominion Bank (TD) - South Gent | Seeking Alpha
TD Realized Gains to Date: $1,767.32
Analyst Reports (available to Schwab customers)
S&P (12/22/22): 3 stars with a 12 month PT of US$70
Morningstar (12/7/22): 4 stars with a $72 fair value estimate and a wide economic moat.
3. Small Ball Buys:
I am adding to some positions where the dividend yield is higher than current MM rates.
A. Added to CLPR - Bought 10 at $6.87:
Investment category: Equity REIT Common and Preferred Stock Basket Strategy
Last Discussed: Item # 2.C. Eliminated CLPR in Schwab Account - Sold 20 at $9.09 (1/7/22 Post)(profit snapshot = $30.54); Item # 1.D. Bought 50 CLPR at $7.36 (7/15/21 Post)
New AC per share: $7.2 (60+ shares)
Dividend: Quarterly at $.095 per share ($.38 annually)
Yield at $7.2: 5.28%
Last Ex Dividend: 11/20/22
Last Earnings Report (Q/E 9/30/22): SEC Filed Press Release
AFFO per share at $.12
The AFFO calculation deducts maintenance expenditures from FFO.
Lease Occupancy: 99.1%
Rent Collection: 95.5%
Glossary of REIT Terms | Nareit
Debt: Mostly fixed rate mortgages
 |
| Page 14, 10-Q for the Q/E 9/30/22 |
B. Added to CTO in Schwab Taxable Account - Bought 5 at $19.22:
Quote: CTO Realty Growth Inc. (CTO)
Website: Home - CTO Realty Growth, Inc.
Management: External
Investment Category: Equity REIT Common and Preferred Stock Basket Strategy
Stock Split: 3 for 1 effective 7/1/22
Businesses: Owns commercial properties, receives fees as the external manager for Alpine Income Property Trust Inc. (PINE) and dividends as a PINE stock owner, invests in commercial property loans, and has a portfolio of subsurface mineral rights that are periodically sold. As of 12/31/22, CTO owned 2,203,397 PINE shares.
Last Stock Offering (12/22): Prospectus, 3.45M shares at a $19 public offering price which includes the greenshoe.
Average cost per share this account = $19.59 (30+ shares)
Dividend: Quarterly at $.38 per share (was at $1.12 prior to the 3 for 1 stock split)
Yield at AC per share this account: 7.76%
Last Ex Dividend: 12/9/22
Last Discussed: Item # 5.F. Bought 10 CTO at $19.08 in Fidelity Taxable Account (12/6/22 Post). I discussed the last earnings report in that post. The 4th quarter report is scheduled for release on 2/23/23.
News Since Last Discussion: CTO Realty Growth and Announces Record 2022 Transaction Activity and Provides Corporate Update (1/4/23)
Other Recent Buy Discussion: Item # 4.K. Added to CTO in Schwab Taxable Account - Bought 2 at $17.77; 3 at $17.54 (10/11/22 Post)
As part of my ongoing house cleaning, I am cutting back on owning the same stock in multiple taxable accounts. I will sell my shares held in the Fidelity account when and if the price exceeds $20 and will add to my position going forward from now only in my Schwab account.
Purchase Restriction: 5 or 10 share lots up to a 200 share maximum position. Each subsequent purchase must reduce my average cost per share, changed from each purchase must be at the lowest price in the chain.
C. Bought 5 PDM at $10.3 - Schwab Taxable Account:
Quote: Piedmont Office Realty Trust Inc. Cl A (PDM)
Piedmont Office Realty Trust, Inc- Investor Relations
Investment categories: Equity REIT Common and Preferred Stock Basket Strategy/Bond Substitute
Last Discussed: Item # 2.B. Added to PDM in Schwab Taxable Account - Bought 5 at $9.56; 5 at $9.37; 5 at $9.12; 5 at $8.95 (12/13/22 Post)
Dividend: Quarterly at $.21 per share.
I have changed my dividend option to reinvestment based on valuation.
Average cost per share: $11.26
Yield at New AC per share = 7.46%
Next Ex Dividend: 2/23/23
Last Earnings Report (Q/E 12/31/22): SEC Filed Press Release and SEC Supplemental Filing
Excluded from FFO/AFFO is a $101.1M gain from property sales. PDM paid off its entire balance on its credit line.
FFO per share at $.48
Core FFO per share at $.50
AFFO per share (equivalent to CAD) = $.38 (computed by dividing $47.082M in AFFO by 123.633M shares weighted average shares)
Percent Leased: 86.7%
PDM "had approximately 1.14 million square feet of executed leases for vacant space yet to commence or under rental abatement, representing approximately $33 million of future additional annual cash revenue."
2023 Guidance: FFO between $1.8-$1.9 with an estimated $27M increase in interest expense compared to 2022
PDM Realized Gains to Date: $364.83
Sell Discussions: Item # 1.A. Eliminated PDM in Schwab Account - Sold 5 at $18.71 and 34+ at $18 (12/31/21 Post)(profit snapshot = $235.88); Item # 2.H. Eliminated PDM- Sold 10 at $17.95 in Fidelity Account and 10 at $18.02 in Vanguard Taxable Account (1/7/22 Post)(profit snapshots = $128.95)
New Purchase Restriction: Each subsequent purchase must reduce my average cost per share.
Goal: Any realized gain on the shares prior to any ROC adjustments + the dividend.
SU Bonds: I currently own 4
Item # 2.K. Bought 2 Piedmont Office REIT L.P. 3.4% SU Bonds Maturing on 6/1/23 at a Total Cost of 98.783 (11/1/22 Post); FINRA Page
Item # 1.A. Bought 2 Piedmont Office REIT L.P. 4.45% SU Bonds Maturing on 3/15/24 (11/8/22 Post); Finra Page
SU bonds are currently rated Baa2/BBB.
4. Corporate Bonds: +$2,000
A. Bought 2 Hess 3.5% SU Maturing on 7/15/24 at a Total Cost of 97.566:
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Issuer: Hess Corp. (HES)
HES Analyst Estimates | MarketWatch
SEC Filed Earnings Press Release for the Q/E 12/31/22 (net income of $624M, adjusted to $548M)
FINRA Page: Bond Detail (prospectus linked)
Credit Ratings: Baa3/BBB-
YTM at Total Cost: 5.3%
Current Yield at TC = 3.587%
I now own 4. This Hess bond is the next one that matures.
5. Treasury Bills Purchased at Auction: +$7,000
I have a $10K T Bill maturing tomorrow in my Fidelity Account. I will allow those funds to remain in SPAXX, the Fidelity Government MM fund, which currently has a 7 day yield of 4.2%.
Another $5K T Bill matures on 2/23 in my Schwab account. The proceeds will be used to buy a 3 month T Bill.
In March, I have $37K in T Bills maturing. Of that amount, $23K in proceeds will be paid into my Schwab sweep account and will be redirected into new T Bill purchases. There is no reason to keep funds for long in my Schwab sweep account that has a .45% yield.
The remaining T Bills maturing next month are in my Vanguard or Fidelity accounts. The proceeds from T Bills maturing in my Fidelity account will likely be redeployed into CDs maturing in 9 to 18 months.
I will not redeploy proceeds paid into my higher yielding Vanguard Federal MM fund.
A. Bought 2 Treasury Bills at 2/13/23 Auction:
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Matures on 5/18/23
91 Day Bill
Interest: $23.66
Investment Rate: 4.802%
B. Bought 3 Treasury Bills at 2/15/23 Auction:
C. Bought 2 Treasury Bills at the 2/16/23 Auction:
Inflation has come down... while expectation of peek's moved out from 6 mo to 1 year.
ReplyDeleteRussia is what dictatorships are. People turn in their neighbors and friends. Sometimes for money. But sometimes for nothing but cultism. Surreal. An acquaintance described her study of Arabic in Syria. Houses were bugged and people afraid to speak up. I've wondered if that's has any logistical slow down now that Bashar is busy with civil war. (She's Jewish but choose Syria over a Moroccan program, because as long as she 'passed', crime was much lower in the Syrian dictatorship.)
Someone else mentioned the Duchovny episode and program to me recently. I'd like to find it & watch some. It sounds so interesting.
It's hard to believe people are unaware of their own family coming from the Pale of Settlement and how rotten it was. It's become an English expression, "beyond the pale." Ops, have to correct myself. Looking it up, apparently there was part of Ireland called the Pale that was outside English reach and that's where it came from. Lol, well, that's not how it's used in the Jewish community.
Land: The higher yield on the 1 year involves an investor acceptance that the FED will increase the FF rate in March and May and will likely do so again in June. Consequently, short term rates will remain higher for longer than previously expected by the Bond Ghouls. That change in the previous consensus opinion has also caused a rise in the 2 year note yield this month.
DeleteThe CPI 12 month annual rate through January is still higher than the 5% T Bill rate, though it is possible that a 1 year bill purchased tomorrow will have a positive real return before taxes.
Most people alive today know nothing about their great-grandparents. Maybe they recall hearing something that their ancestors immigrated to America a long term ago from someplace in Eastern Europe or elsewhere but that is really fuzzy and frequently wrong.
My 9x maternal great grandfather was born in 1615 in Bristol, England and immigrated to the U.S. in 1635, as shown on the manifest of a ship called the Primrose and settled in Virginia.
My 3x paternal grandfather was born in NYC but settled in the south after fighting in the War of 1812 and ending up in Georgia which was where my 2x paternal grandfather was born. In the 1860 Census, it was a sharecropper with 5 children and less than $100 of property. The best decision he made for his family was to move to Nashville after the Civil War. The same kind of fateful long term decision was made by my maternal grandfather who moved from rural Hickman County to Nashville during the Depression. Those decisions resulted in better lives for their family members and their descendants.
That's so long ago! Near the Mayflower timing. Shows that sometimes the best way to make money is to move to opportunity.
DeleteBack then moves like this were a big deal, with lot's of risk and change. No McDonald's at the center of town, with the local beer on tap, or coke.
I decided to ditch my contemplated purchase of CDs with the $10K received today from a T Bill maturity. Instead, I bought a few corporate bonds maturing in 2024 today and will participate in tomorrow's 4 month T Bill auction. The close today was at 4.98%.
ReplyDeletehttps://home.treasury.gov/resource-center/data-chart-center/interest-rates/TextView?type=daily_treasury_yield_curve&field_tdr_date_value_month=202302
The 1 year T Bill was auctioned today with an investment rate of 5.046%. That kind of IR yield was last seen in 2007 and only briefly. You would need to go back to 1994-2000 to discover a constant trend above 5%.
https://fred.stlouisfed.org/series/DGS1
The stock market downdraft today was overdue IMO. Investors were still clinging to valuations based on a blue sky scenario relating to interest rates and inflation.
Predictions made about 2023 FF rates have changed materially since the last jobs and CPI reports.
https://www.cmegroup.com/markets/interest-rates/cme-fedwatch-tool.html
The current FF range is 4.5-4.75%. The odds of at least a .25% hike next month is still at 100% but the odds of a .5% hike have crept up to 25.5%.
At least another .25% hike in May is currently at 98.4% That would bring the range up to at least 5-5.25% with a 25% chance that the range will be 5.25%-5.5%.
The odds of at least another .25% to 5.25%-5.5% in June is currently at 75.4%.
The probability of a year end range of at least 5.25%-5.5% is currently at 49.9% and 83.3% at 5.-5.25%.
This kind of data does impact my weightings in bond durations, taking into account my financial needs and life expectancy.
It looks like it's dawning on the market that Fed is going to do what they've been saying.
DeleteI'm going to rate chase in cash. Bonds seems like a good way.
I forgot about Shiller's key element to his P/E charts. Interest rates.The higher P/Es are more reasonable when rates were 0-1%. Higher rates should be effecting the market now.
+++
Good thing my total Intel investment is a little over $800. I bought 16 shares then didn't buy down.
DollarTree stores are looking empty lately. There's areas that aren't stocked. Maybe they're backed up from when China was closed. It's been several stores.
The personal consumption price index rose more than expected in January. The annual rate was 5.4%, up from 5.3% in December. The core PCE price index increased 4.7% Y-O-Y, up from 4.6% in December.
ReplyDeleteThe PCE price index was up .6% in January compared to .2% in December. The core PCE price index increased .6% compared to .4% in December.
This report confirms the concern, recently formed this month by the Stock Jocks and Bond Ghouls, that problematic inflation is going to be sticky and will not be coming down sufficiently to avoid multiple FF increases this year or cause a cut after multiple increases.
On the positive side, the economy is still avoiding stagflation, another major concern.
Personal consumption expenditures increased 1.6% but personal income rose only .6%. That mismatch raises a concern that consumers will have to cut back on spending if that trend continues for much longer.
Thanks for the summary!!
DeleteAvoiding stagflation is a big relief.
The economic indicators are "solidly mixed." But I have no doubt that inflation will stay around for longer than mid-year. The late bull optimism is still driving the market. There may not be a recession (is that what "no landing" means?), but the Fed isn't pivoting in 2-3 months!
Looks like the warning in Dec that 1 good reading or 2, doesn't mean a pattern is firmly in place yet.
I have cash sitting in Vanguard. Should probably do a little more selling and adjustments to the 1/4 of my portfolio still left in stocks. (I'm writing to remind myself.)
Vanguard sent a message that they now have a cash settlement fund that's an FDIC insured bank product, not a mutual fund.
At 3.1%. I hope I don't accidentally hit anything that authorizes that on my account. !
Bloomberg guest yesterday was talking about her recommendations are floating rate 5% with 400 point spread interest products, so 9% interest. She thought they were safe and would avoid risk now. I couldn't make out what she was talking about.
First Foundation is now at 4.2% so I moved to Vang's 4.5%.
Ameritrade is still at .35% in their sweep account. It's hard to believe they're getting away with it.
S&P 500 Index 3,946.26
ReplyDelete-66.06 -1.65%
Last Updated: Feb 24, 2023 at 10:31 a.m. EST
Using a Yahoo Finance 1 year chart, the current 200 SMA line is at 3,940.23. I am expecting that line to be pierced to the downside.
The 50 day SMA line which is currently at 3,980.89 was pierced a few days ago.
The VIX remains in an Unstable Vix Pattern. I am currently anticipating another spike into the high 20s-low 30s.
It does not look now like the stock market is going to cooperate with my goal of a 15%+ total return this year. I have reduced the expectation to 5% to 7%, mostly generated by trading gains, MM dividends, and interest payments. Possibly that may turn out to be conservative with buying into another major decline followed relatively quickly by recovery in prices which will give me an opportunity for more trading gains.
I have published a new post:
ReplyDeletehttps://tennesseeindependent.blogspot.com/2023/02/atlo-d-gnl-kmi-matv-opbk-pdm-stew-vktx.html