Four Stocks Worth Following

by: The Moneygardener October 05, 2008 | about stocks: DEO / GE / MMM / WAG    

The Moneygardener

About this author:
Become a Contributor Submit an Article
  • Font Size:
  • Print

With the S&P 500 index now re-visiting levels not seen since 2004, it is no surprise that several great companies with long histories of earnings and dividend growth are getting down to some notable lows. This massive sell off is not being felt the same across all sectors. Not surprisingly consumer staples seem to be holding up very well as recession fears loom. Consumer staples are typically products that people will continue to buy in hard times. Major selling is certainly at hand for companies operating in sectors that are directly affected by the broader economy in general and consumers discretionary spending.

Typically during such a steep, quick sell off like this it is wise to avoid 'catching a falling knife' when attempting to buy stocks at good value. Easier said than done, but one should try to wait until a particular stock stops going down and meets some support partnering with large volume before buying. Here are a few examples which I feel are notable and possibly worth taking a look at now or at some point soon. I am keeping a close eye on the following, and I'll likely make a purchase soon based on a list of stocks which includes these four. Ideally equity investors should have a time horizon of more than seven years and ensure they are properly diversified.

3M Company (MMM) - The diversified technology company which has paid a mostly rising dividend since 1977 is trading at levels not seen since July of 2003. Yield = 3.1%

Walgreen Company (WAG) - The U.S. drugstore chain with a stellar history of earnings and dividend growth is trading at levels not seen since February of 2003. Yield = 1.6%

Diageo PLC (DEO) - The maker of branded alcohol who has grown its dividend at a compound annual growth rate of 8% over the past 10 years is changing hands at levels last seen during April of 2006. Yield = 4.8%

General Electric (GE) - The diversified conglomerate with an outstanding record of earnings and dividend growth is trading at levels only seen briefly in February of 2003. Yield = 5.8%

Of course there are several more examples in the stock market today. You might call this the start or the end of recession pricing.

Disclosure: None

Related Articles

This article has 13 comments:

  •  
    Oct 05 09:25 AM
    I love value, growth and income and you do not find stocks with those 3 characteristics too often. It seems to me those 4 stocks fit the bill and we own DEO and GE . I have been tempted to buy MMM and EMR lately but have resisted to the temptation until now(always thinking it s gone to go lower yet). The name GE in your article is going to attract a lot of bashers ,a lot of people love to hate this stock and they have tons of reasons but that didn t stop me from buying it.
    Reply | Link to Comment
  •  
    Oct 05 10:52 AM
    I likely have my fill of GE for now being down quite a bit and still having a heavy weighting, but DEO is one stock that looks appealing at this valuation over the long-term. An emerging middle class in developing nations sure makes one thing that they like alcohol as much as we do!
    Reply | Link to Comment
  •  
    Oct 05 11:13 AM
    I too own GE, but don't appreciate Immelt changing his story everytime he has a news announcement, AND 10 billion shares outstanding is wayyyyyyyyyy over the top imo. Other value stocks with good solid dividends are DOW, PFE, HD, MO, and ITW. Good article by the way.
    Buy when there's blood in the streets, and also possible the DJIA could get near 9000 to satisfy 2 previous corrections (ie : 87 and 02), which approached 36% and 37.8% respectively.
    Reply | Link to Comment
  •  
    Oct 05 11:58 AM
    Thank for the thoughts, i have been following ITW, DHR, GPC and VFC for myself.
    Reply | Link to Comment
  •  
    Oct 05 01:16 PM
    I agree on GE. Good dividend, diversified company, warren buffet owns it.
    Reply | Link to Comment
  •  
    Oct 05 02:56 PM
    Nomad you are right concerning Immelt but he is going to be history before I sell my GE.Hopefully they then will find the right person to lead this company.Anonymous I share your thought about DEO.
    Reply | Link to Comment
  •  
    Oct 05 05:37 PM
    Be careful of PFE's dividend. There are reasons PFE's share price is in the dumps. It starts with l and ends with ipitor. And its going off patent and PFE has no pipeline.
    Reply | Link to Comment
  •  
    Oct 05 08:24 PM
    I like all of the above but haven't initiated a position in any of them yet. I have been picking up some financials recently Bank of America and Citi Bank. Granted they have cut their dividend but I expect them to come back long term. I am considering Ford but will probably shelve that one for now. Good post though, with Buffet picking up GE I may just get some of that happy bargain hunting.
    Reply | Link to Comment
  •  
    Oct 05 11:37 PM
    The article touts a 5.8% dividend. Where has the author been? GE has financial problems. No more buy back of shares, etc. Don't rely on that 5.8% rate continuing..The GE share price has been reduced by more than 30%.
    Reply | Link to Comment
  •  
    Oct 06 12:37 AM
    WAG IS THE BEST DRUGSTORE STOCK TO OWN. WALGREENS IS THE BEST DRUGSTORE TO SHOP.
    Reply | Link to Comment
  •  
    Oct 06 12:50 AM
    GE has a nice dividend, and will likely see some bounce when the market rallys but the long-term potential for the company is wasting away as long as Imelt is in charge. What has it come down from 58? That's ridiculous! A real bounce will come with naming a new CEO.
    Reply | Link to Comment
  •  
    Oct 06 07:21 AM
    Buffet bought perpetual preferred 10% GE stock, and warrents to buy common stock @ $22.50. This deal is unavailable to investing public. Pays to be a billionaire:)
    Reply | Link to Comment
  •  
    Oct 08 08:31 PM
    my two cents...

    be careful of GE if it goes through 20, on its way to 15....
    MMM, ITW, EMR and WAG are worth averaging into at these levels...
    DE and HAL are way oversold...good companies with good finances.
    Reply | Link to Comment
More Comments on MMM ยป
Top Rated Comment Streams:

Numbers are net rating-

See all Top 100 »
More by The Moneygardener

Investment Resources
Money Management
Research
Seeking Alpha provides these ads as a service to its leading contributors
Articles on related themes
Market Strategy
Bonds
Dollar/Currencies
Earnings