Today- everything is falling

Commodities and equities alike.

Oil down $9 bbl. RBOB gasoline down 25 cents/gallon

Wheat, soybeans, corn, lumber- all down significantly.

Fever breaking?

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MDB +10%
ZS + 3%
CRWD + 3%
MNDY + 6%

Some things have been going up. Remember when someone mentioned here some time ago to watch the Saul stocks for a rebound? I think it has been starting to happen the last week or two. I’m hopeful this is a good sign. But not buying, just yet.

Remember when someone mentioned here some time ago to watch the Saul stocks for a rebound?

Saul has talked about testing a bottom, something like 5 times now.

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Oil down $9 bbl. RBOB gasoline down 25 cents/gallon

Surely, the passing of the US July 4th holiday isn’t influencing global oil markets…surely…just like oil fell after July 4th of 2008…surely.
/sarcasm

Steve

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My target for the SPY is falling. I think odds of dividend cuts are mounting.

Most companies are proud of their dividend payment record. Most will retain their dividend for a while if they think the downturn is temporary. Meanwhile they will be cutting cost to maintain profits and keep paying that dividend.

Companies like GM used to be an exception. They had a base dividend and would pay a supplement in a good year. But I think variable dividends are out of style these days.

In Barron’s a company omitting a dividend got a big black O by their listing. Poison to income investors.

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Profits were way up in 2021 riding into mid 2022. The profits are falling suddenly. When profits are up some companies over promise by raising dividends too quickly. The change in fortunes some will cut dividends. Possibly. But that changes how far the SPY will fall.

And indeed you can estimate the potential by multiplying %yield of the dividend by the price earnings ratio to get % of earnings paid as dividends.

Stable companies usually keep that number below 50%. Those over 100% are clearly at risk. Most companies will not borrow funds to pay dividends.

Of course this works best when earnings are steady. PE may need adjustment if earnings fade rapidly.

But I think variable dividends are out of style these days.

In Barron’s a company omitting a dividend got a big black O by their listing. Poison to income investors.

Tru dat! But today:

https://www.bing.com/search?q=companies+paying+dividends&…

I think TMF’s Dividend Growth Investing discussion board does a good job.

https://discussion.fool.com/any-thoughts-about-altria-35137137.a…

They are into stocks with a long history of increasing their dividend.

Yes, while we are heading into declining earnings and possible recession investors need to be careful in their choices.

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Thank you for recommending this post to our Best of feature.

I think TMF’s Dividend Growth Investing discussion board does a good job.

They are into stocks with a long history of increasing their dividend.

I do that for mine and my wife’s ports but only Canadian listed stocks qualify for our TFSA (Tax Free Savings Accounts).

Tim