The Long Term Investor

No...I dont think I will be buying TESLA any time soon. I do not generally favor auto companies....they are too boom and bust for my taste.

I bought TESLA based on three criteria......as a medium term trade. When I bought in June of 2020......the stock was facing over the next months......production numbers.......a quarterly profit......eligibility.entry into the SP500. I thought that it was PROBABLE that the three factors would be positive and drive the stock up. They were.....and they did.....and I took my profit in two rounds.

BUT......no plans at the moment....or any time soon...to buy this stock.

 

NO big stuff going on tomorrow........we will get some economic data. Thursday morning will be the......Initial Jobless Claims Report. It is expected to show a drop in new unemployment filings after last week's unexpected uptick. And.......on Friday the..... Personal Consumptions Expenditures (PCE) report.......is expected to show that headline inflation rose at the fastest pace in 13 years in May. Another talking point for the.....INFLATION HUNGRY media.

I assume it will be ANOTHER drifting, shallow, day in the markets.

 

Yes……Beautiful open today. I am out and about so no time for much posting. So…..I will let my stocks just do their thing this morning. We must be pushing +14% on the SP500 right now. An amazing result when you consider we are not even at the halfway point of the year yet. Plus….look back through this thread at ALL the constant negative fear mongering this year and over the past 5 years. An amazing lesson in long term investing.

 

Yes….those dividends are glorious. I remember my mom’s account in the 1990’s getting over $25K in dividends per year from PM alone. Her account was growing by tens of thousands every year regardless of the markets or anything else. At that time nearly every stock in her account was a divided giant.

 

HA.......one of those days when the averages look a lot better than my portfolio. It is STILL a very nice day.....but....having only 10 stocks....I hate those days when all the averages are NICELY up and I look at my portfolio and it is barely green. Of course.....I never gripe when the averages are doing poorly.....and.....my portfolio is UP.

 

SPEAKING of dividends above....here is a little article that touches on the topic as well as the topic of selling small amounts of a portfolio when income is needed.

Investors Needn’t Reach for Yield
Cash flow is a lot simpler to reap than yield-obsessed headlines let on.

https://www.fisherinvestments.com/en-us/marketminder/investors-neednt-reach-for-yield

(BOLD is my opinion OR what I consider important content)

"Lately, we have noticed several headlines lamenting bonds’ paltry yields, leaving individual mom-and-pop retirement investors and ginormous institutional pension funds alike scratching their heads. In this ultra-low interest rate world, what is there to meet their cash flow needs? Fortunately, we think there is an often overlooked but ready solution in retirement investors’ toolkits: what we call homegrown dividends.

With interest rates super low on virtually every type of bond imaginable, many see difficulty generating sufficient cash flow from a portfolio. They presume adequate, regular and dependable withdrawals require alternative, illiquid avenues like private investments—non-publicly traded assets with less reporting and disclosure requirements than ones that trade on regulated exchanges, potentially including things like non-traded REITs.

But there are a couple problems going this route as we see it. First, such hard-to-sell assets often carry high fees and may not match your financial goals and investment time horizon—how long you need your accumulated savings to support your endeavors. The illiquidity may also make them exceedingly hard to exit if you expect a market downturn. Second, the notion that you have to reach for exotic investments to get high yield plays into the myth that portfolio income is synonymous with cash flow.

From an investment perspective, income is interest and dividends coming from any security in your portfolio. It is a part of a security’s overall return—a part too many investors treat separately from price movement. But we think the two must be considered in concert. Together, interest, dividends and price movements constitute a portfolio’s total return. By contrast, cash flow is money you withdraw from your portfolio to meet expenses—regardless of how that withdrawal is funded.

When you remove the arbitrary halo shining over dividends and interest, you will find a simple answer to the alleged cash-flow conundrum: reaping homegrown dividends when needed by selling securities. As we explained before, selling stock is a perfectly legitimate way to get cash flow from an investment portfolio. Doing so allows you to control the timing and amount of capital you raise. It can also be as tax efficient or more so, depending on the amount of gain, whether it is long-term and the account’s tax status.

Now, many see this as problematic, arguing it eats into principal. But this overlooks two points: One, traditional dividends reduce stock prices, too—every single time a common stock pays a dividend, its price is reduced commensurately. Two, price appreciation over time means your principal likely isn’t static. Thinking cash flow can come only from interest or dividends is a needless straitjacket for investors.

Knowing you can use homegrown dividends to fund cash flow needs also allows you to make better investment choices, in our view. Restricting yourself to withdrawals from just interest and dividend income could lead you to disadvantageous decisions, like seeking yield in areas unlikely to maximize your portfolio’s longer-term total return. Devoting your portfolio to boost its income—loading up on bonds and dividend-oriented stocks—isn’t always optimal. It can lead to unintentional overweights to value-oriented sectors that typically pay higher dividends. It may even negatively affect diversification, increasing your portfolio’s risk. Being open to selling stock also lets you avoid pitfalls from all the idiosyncratic risks that come when pursuing income in less liquid or exotic alternatives. Homegrown dividends gives you a way out of the low interest rate trap without having to “reach for yield.”

In our view, picking an asset allocation should always be about the balance between your goals, time horizon, the total return you need to achieve those goals and managing the risks necessary to get there. Accordingly, prioritizing total return over portfolio income is crucial. A homegrown dividend strategy lets you focus on getting the growth you need in your portfolio as a whole to sustain your anticipated withdrawals over the entire time you need your portfolio to work. In contrast, a focus on yield alone is shortsighted—and can introduce unnecessary risks. You don’t need to plunge into exotic, high-fee, illiquid assets that generally lack transparency to fund your cash flow needs. Just viewing your portfolio as one holistic source of retirement funding can solve the problems posed by a yield drought. Rather than fret about cash flow with interest rates historically low, take comfort: With appropriate planning and forethought you can generate your own homegrown dividends as needed."

MY COMMENT

TOTALLY AGREE. There is NOTHING wrong with cashing some stock at the right time to fund cash needs. Your stock holdings are NOT a....SHRINE. They are a....TOOL.

Most people know well in advance when they are going to need cash flow. There is NOTHING wrong with looking ahead to your cash needs and selling enough of a stock holding......when the market is at a top....to satisfy that future need. Lets say you are supplementing your retirement from your portfolio......and....you keep three years of cash needs. At some time during that three years you....WILL....have an opportunity to replenish that bucket by selling some holdings at a MARKET TOP. The planing required is simple and obvious.

 

HERE.....is the GOOD inflation news of the day....even if no one cares.

Jobless claims hold above 400,000 for the second week in a row

https://www.cnbc.com/2021/06/24/weekly-jobless-claims.html

(BOLD is my opinion OR what I consider important content)

"Key Points

• Initial jobless claims totaled 411,000 for the week ended June 19, a decline from the 418,000 in the previous period but worse than the 380,000 estimate.
• Continuing claims decreased to 3.39 million.
• In other reports, durable goods orders rose 2.3%, below the Dow Jones estimate, while the final reading on first-quarter GDP came in at 6.4%, in line with expectations.

Initial claims for unemployment insurance remained elevated last week as employers struggled to fill a record number of job openings.

First-time filings totaled 411,000 for the week ended June 19, a slight decrease from the previous total of 418,000 but worse than the 380,000 Dow Jones estimate, the Labor Department reported Thursday.

A separate report from the Census Bureau showed that orders for long-lasting big-ticket items increased by 2.3% in May, slightly below the 2.6% estimate but still the biggest gain since July.

Also, the final count on first-quarter gross domestic product growth came in at 6.4%, unchanged from the last estimate and in line with forecasts.

Key stock markets indexes rose fractionally after the reports.

“Claims are noisy, and the weekly seasonal adjustments are unreliable. We expect new lows for initial claims in July; letting people go in increasing numbers now makes no sense as the economy rebounds,” wrote Ian Shepherdson, chief economist at Pantheon Macroeconomics.

Employment has taken the biggest focus for policymakers, and the latest data shows that the sharp claims drop from earlier in the spring has flattened.

That comes amid a record 9.3 million job openings, a total just shy of the 9.6 million or so American workers still counted as unemployed. Last week’s jobless claims total marked the second week in a row that the level has stayed above 400,000 after briefly dipping below in late May.

As things stand, the current level of initial claims is about double where it was prior to the Covid-19 pandemic.

The good news on the jobs front is that continuing claims are on the decline, falling to 3.39 million, a drop of 144,000. That number runs a week behind the headline claims total.

The total of those receiving benefits through all programs was little changed at 14.84 million through June 5.

Pennsylvania showed the biggest increase in claims at 14,523, while Illinois (-3,605) and California (-3,300) reported substantial declines.

In other economic news, the durable goods orders gain of 2.3% represented an increase from a 0.8% decline in April, the only drop in the last 13 months.

Excluding transportation, orders increased just 0.3%, while the total showed a 1.7% increase excluding a decline in defense orders. Shipments, unfilled orders and inventories all accelerated while new orders for nondefense capital goods jumped 2.7%.

In the GDP report, the final 6.4% estimate was unchanged as higher revisions for investment and exports were offset by an upward revision to imports."

MY COMMENT

LOTS of good inflation info in these reports. Employment remains weak and an issue. Durable goods orders actually dropped....... declined compared to prior numbers for the first time in a while. Some SOLID indicators for stock investors with a long term....re-opening....mentality.

IGNORE.....the GARBAGE, CHAFF, NOISE......you name it....IGNORE IT.

 

HERE is a perfect example of the......"stuff".....that should be IGNORED. A perfect example of FEAR MONGERING for clicks in an article by a site that should know better. I generally like this site and their material....but...COME ON MAN.

Mortgage rates jump above 3% for the first time since April — economists warn they’re likely to rise higher

https://www.marketwatch.com/story/m...kely-to-rise-higher-11624543874?siteid=yhoof2

"Homeowners who have yet to refinance may miss out on the opportunity to save if they don’t act soon.......etc, etc."

YET....at the same time we see:

Today’s Mortgage Rates: June 24, 2021—Mortgage Rates Fall

https://www.forbes.com/advisor/mortgages/mortgage-rates-06-24-21/

"The average rate fell on a 30-year fixed mortgage, slipping to 3.16% from 3.20% yesterday. Today’s rate is lower than the 52-week high of 3.37%.

The 30-year fixed mortgage APR is 3.33%. At this time last week, it was 3.35%. Here’s why APR is important.....etc, etc."

OR

Today's mortgage rates: 30-year rates fall, other terms unchanged | June 24, 2021

https://www.foxbusiness.com/money/todays-mortgage-rates-june-24-2021

MY COMMENT

I ALSO see many other articles about the rates being lower today. REGARDLESS......fear mongering a mortgage rate of about 3.13% is just plain DUMB. I hate to see what they will be saying when we get back to the 4.5% to 6% level.

 

YES.....I DO disclose ALL my holdings and moves on this thread. I dont have any ILLUSION that somehow this is going to make a bit of difference to anything.....including my privacy. SO......why not. It is not like I am cheating on my taxes or something.

I ACTUALLY believe that an investing thread MUST have such disclosure to have any real value to anyone that is a reader. Over time......anyone.....has the ability to go back and look at the long term ACTUAL results versus the posts that are being put up....and....determine if the person doing the posting has any ACTUAL idea of what they are talking about.

 

As a shareholder this is....ALL GOOD...to me.
Nike torches Wall Street estimates in Q4 as China effect less than expected

https://finance.yahoo.com/news/nike-q-4-2021-earnings-165843774.html

(BOLD is my opinion OR what I consider important content)

"Nike (NKE) reported fourth-quarter earnings after the bell, which saw the Swoosh brand smash expectations despite concerns over trouble for the brand in Greater China.

• Revenue: $12.3 billion vs. $ 11.033 billion expected and up 96% Y/Y
• Adjusted earnings per share: $93 cents vs. $ 50 cents expected.

Many wondered if the Swoosh brand would continue paying the price for statements made over alleged human rights abuses against Uyghurs in Xinjiang's northern province. However, the Swoosh brand has just completed seven consecutive years of double-digit, currency-neutral growth for its Greater China business. In North America, Nike delivered record revenues, which were up 141% on a reported basis for the fourth quarter and up 29 percent compared to the fourth quarter of 2019.

Sam Poser, analyst at Williams Trading, believed that the China concerns are “much ado about very little.

“The brand here [ in the U.S.] is insane and they finally got the inventories into a position where even with the more moderate channels of distribution they’ve created a pull model,” Poser told Yahoo Finance. He also expects Nike to see solid online sales growth this quarter. "

HERE is another take.

Nike earnings and sales beat estimates, retailer books record revenue in North America

https://www.cnbc.com/2021/06/24/nike-nke-q4-2021-earnings.html

Key Points

• Nike’s fiscal fourth-quarter earnings and sales were fueled by record revenue in its largest market, North America.
• Digital sales were up 41% compared with the prior year, and rose 147% compared with the same period in 2019.

Nike on Thursday reported fiscal fourth-quarter earnings and sales that topped analysts’ estimates, fueled by record revenue in its largest market, North America.

Nike shares jumped more than 4% in after-hours trading.

Here’s how the company did during its fiscal fourth quarter, compared with what analysts were anticipating, using Refinitiv estimates:

• Earnings per share: 93 cents vs. 51 cents expected
• Revenue: $12.34 billion vs. $11.01 billion expected

Nike’s net income for the period ended May 31 rose to $1.5 billion, or 93 cents per share, compared with a loss of $790 million, or 51 cents per share, a year earlier. That topped analysts’ forecast of 51 cents per share, using Refinitiv data.

Total revenue rose to $12.34 billion from $6.31 billion a year earlier, topping estimates for $11.01 billion.

In North America, Nike’s biggest market, sales more than doubled to a record $5.38 billion as the company surged from a year earlier when the Covid pandemic was hitting the retail industry the hardest. The region’s sales were up 29% on a two-year basis.

Digital sales were up 41% compared with the prior year, and rose 147% compared with the same period in 2019."

MY COMMENT

TOTAL BLOW OUT.....on the earnings. It is hard to imagine earnings BEATING by this much. OBVIOUSLY the ........yes once again....fear mongering....and speculation in the media over the past few months based on concerns about business in China.........was TOTALLY WRONG.

 

For those that are TESLA fans.....I do ACTUALLY....still....own a good chunk of TESLA since it is the 6th LARGEST holding in my SP500 Index fund. Since the Index is market-cap weighted......they are a major holding in the Index and for Index shareholders like myself.

 

HERE is the......what and why....of the markets today.

Stock market news live updates: Stocks end higher amid infrastructure deal, economic optimism; S&P 500 and Nasdaq reach record highs

https://news.yahoo.com/stock-market-news-live-updates-june-24-2021-221753533.html

(BOLD is my opinion OR what i consider important content)

"Stocks rose to record levels Thursday as investors digested another batch of key economic data and an announcement from President Joe Biden that he had reached a bipartisan infrastructure agreement with Senate lawmakers.

The S&P 500 and Nasdaq each set record intraday highs. The Dow extended gains to add more than 300 points, or nearly 1%.

Technology stocks have outperformed this week, with traders jumping back into the growth names that had underperformed so far for the year-to-date.

The advance in these has come at the expense of cyclical and value stocks and other shares that have comprised the "reopening trade," however. This rotation has occurred in part as concerns mount over higher inflation, with an extended period of higher prices potentially weighing on the strength of the economic recovery and stocks levered to economic growth.

Some strategists however, have downplayed these apprehensions.

"The value trade is still intact. It got overcrowded, it got over-loved ... but when we look at the fundamental drivers behind that trade, they're still intact," Keith Lerner, Portfolio & Market Strategist at Truist Advisory Services, told Yahoo Finance.

"So the first thing is, context. Yes, they had a big run this year, but they've trailed for about 14 years, so we've had a long underperformance cycle," he added. "And the second part is, why did they underperform for so long is because we had really slow economic growth. And this year and next we expect above-trend economic growth. And the earnings momentum and the earnings leverage for these areas is still positive."

While some rotation has occurred beneath the surface this week, the three major indexes have largely moved sideways as traders await more economic and earnings data. Thursday's weekly initial jobless claims report showed a drop in new unemployment filings after last week's unexpected uptick, though the margin of improvement was much smaller than expected. And Friday's personal consumptions expenditures (PCE) report will likely show headline inflation rose at the fastest pace in 13 years in May, in the latest sign of upward inflationary pressures.

These and other reports in the coming months could be crucial in determining the path forward for equities, as investors gauge what level and duration of inflation might prompt a monetary policy move by the Federal Reserve.

"There is going to be some volatility – I think it's going to probably be driven by action from the Fed," Greg Staples, head of fixed income North Americas at DWS Group, told Yahoo Finance on Wednesday. "But I think the real question over the next couple of months is, watch those CPI [consumer price index] prints, watch those PPI [producer price index] prints, meaning the data indicators as to where inflation is going to be."

"If they start to turn down and justify what [Fed Chair Jerome] Powell has been saying all along, that inflation is transitory, I think that's going to be a positive for the market, and I think you'll see a continued upside reaction," he added. "If on the other hand, they start to run hot, and there's a sense that maybe the Fed is really going to have to step in and tighten, you're going to potentially see another leg up in interest rates. And I personally think that would be very, very, bad for risk assets, equities included."

4:17 p.m. ET: Microsoft closes above $2 trillion market capitalization for the first time ever
Big Tech giant Microsoft (MSFT) closed with a market capitalization above $2 trillion for the first time, joining Apple (AAPL) with a valuation above the $2 trillion mark.

The company recently debuted a new version of its Windows operating system, called Windows 11. It has benefited over the course of the pandemic from adoption of its Teams platform, as well as ongoing growth in its Azure cloud offering.

9:25 a.m. ET: Durable goods orders rebounded in May but missed consensus expectations
Durable goods orders, or orders for manufactured items intended to last three years or longer, jumped in May after a dip in April, but rose at a slower-than-expected pace as supply chain issues continued to weigh.

Durable goods orders rose by 2.3% in May over April, according to the Commerce Department's preliminary monthly report. This came following a 0.8% drop in April, which was revised from the 1.3% drop previously reported.

Non-defense capital goods orders, excluding aircraft, unexpectedly fell for the first time since February, ticking down by 0.1% compared to the 0.6% increase expected, according to Bloomberg consensus data. This metric serves as a closely watched proxy of business investment. Non-defense capital goods orders, excluding aircraft, were up 0.9%, which was better than the 0.8% rise expected for May. This metric is factored into calculations of gross domestic product.

8:30 a.m. ET: New jobless claims fell by a smaller than expected margin last week, holding above 400,000
Initial unemployment claims held above the psychologically important 400,000 level for a back-to-back week during the period ended June 19, underscoring the still-choppy recovery in the U.S. labor market.

Initial filings totaled 411,00 last week, coming in above the 380,000 expected. This did decline from the 418,000 reported for the prior week, which was revised up from the 412,000 previously reported.

Continuing claims showed more improvement, dropping to the lowest level since March 2020. These totaled 3.39 million, coming in below the 3.46 million expected and 3.534 million reported for the previous week. "

MY COMMENT

If this is a sideways move this week.....bring it on...I will take this sort of sideways move all day long. The BOTTOM LINE......and ALL......that will matter moving forward for at least the next 12-24 months....the re-opening and company earnings.

I have not looked at my account yet....hoping for a positive surprise compared to what my 10 stocks were doing earlier in the day.......when they were very slightly positive. I have been positive for the past 3 days and am hoping to make it 4 in a row. Looks like this might be enough momentum to get us to a BIG close of the week tomorrow.....and.....have a shot at 5 in a row.

 

The MSFT news above of record market cap today is GOOD news for those like myself that own the stock. Today was a good day for my holdings with the MSFT record and the NKE earnings. In normal fashion.....both will be down tomorrow.

WELL...I hope not...but that seems to be the norm. If so....who cares.

 

WELL....at least I kept my streak alive and am now 4 in a row for positive days this week. I was green....but....not huge. I got beat by the SP500 by .39%. Amazon was the bad boy of my portfolio today that held me down....it was (-1.56%) for the day. AAPL was also a lagging stock today.....(-0.22%). My winner of the day was HON....up by +1.41%.

Nicely NVIDIA...continued their historic RUN with another gain today...this time by +$5.93 per share or +0.78%. STARTING next Monday we will be in the final 3 week SPRINT to the NVIDIA stock split. I am very curious to see if this run up continues for that three weeks.....escalates....or....if there is a drop back in price. To date....I am up by....$5,915 on my little share purchase on May 21 at the time of the split announcement. This translates to.....+28.2%. I STILL anticipate SELLING enough of those shares right after the split to recover my initial investment and keeping the rest of the profit in the form of shares. My ASPIRATIONAL goal is to end up with about......40-50....additional shares post-split as profit. I will just keep those shares as part of my LONG TERM position in NVIDIA.

 

Way to go Emmett. You should have bought the stock.