The Dow started out strong, up 150 from a greatly oversold market. However there was no follow thru so it has bumping along with a gain of 83 currently. Citigroup (C), another Dow stock struggling to remain in the group, is a $3 stock now. Nobody knows what's going on with them, but most thoughts are gloomy for what used to be the largest bank in the world.
For a change of pace, let's take a look at a list of 10 members of the Standard & Poor's 500 Dividend Aristocrats:
Price
___________________11/19/08....Dividend....EPS (trailing 12 months)
Caterpillar (Cat).....................32.84.......1.68........6.07
3M (MMM)............................56.79........2.00.......5.29
Coca Cola (KO)......................41.07.......1.52..........2.57
Exxon-Mobil (XOM)..............65.00........1.60........8.08
Johnson & Johnson (JNJ)......55.35........1.84........4.42
Kimberley Clark (KMB)..........54.07.......2.32........4.10
Procter & Gamble (PG)...........59.33.......1.60.........3.64
Stanley Works (SWK)............25.38.......1.28.........5.01
US Bancorp (USB).................22.12.......1.70.........1.90
VF Corp (VFC).......................39.96.......2.36.........5.83
In all fairness, Caterpillar is not a member of this class. They don't have the track record of a minimum of have the 25 consecutive years of higher divs. However, they are a Dow stock which has paid divs since 1914 & I like them. OK so maybe I prejudiced about CAT, but these companies are in good shape with excellent long term track records of paying increased divs. Hopefully this list will give you ideas of companies worth checking out.
Any investment in these issues requires further analysis to check out how appropriate they are for a portfolio. For example, USB has only modest coverage for its div, but has not been clobbered with massive write-offs so common with other far larger banks. However new days bring new information, care is always needed before making an investment decision.
More selling in the markets will probably drag on for the balance of the year due to year end selling & more negative news about the economy. January may bring a relief rally producing large gains in greatly oversold markets. That rally could be followed by selling from continued negative macro economic news. Now is a good time for research to determine future buying points aimed at locking up high yields to help a very smart investor get thru a very difficult period for investment. These stocks should be excellent to keep your eyes on for future buying opportunities.
Returning to reality, Toyota (TM) is cutting back its workforce preparing for grim times. No point droning on with more dreary stock news, but it looks ugly out there. At these levels, Dow could have a 1000 point loss for the week making it one of the worst weeks in history.
Toyota Will Cut 3,000 Jobs in Japan as Car Sales Fall
Money from stock sales is still going into Treasuries. The 90 day note yields only 3 basis points annualized & the 10 year bond has a 3.21% yield.
