Tim McAleenan Jr. (The Conservative Income Investor)

Los que estáis suscritos, merece la pena?

Yo estoy en suredividend y en dividendgrowthinvestor y valoro la periodicidad y análisis de empresas a comprar en el mes.

Sin embargo en patreon he visto artículos sin periodicidad y que hablan un poco de todo.

Según me digáis me animaré o no a suscribirme.

Saludos y gracias

Bueno, eso es como todo, muy personal.
No escribe mucho, un par de artículos al mes y, a veces, se queda solo en uno.
Sus análisis son “muy de andar por casa”, es decir, no te da un sin fin de datos. Te comenta qué está comprando y por qué y hace mención a los datos que le gustan de esa empresa y ya está.
A mi me fastidia que escriba tan poco y que no cumpla a veces ni con el mínimo de dos artículos al mes, pero también tengo que decir que a mi me ha puesto varias veces en la pista de empresas que lo están haciendo francamente bien y que estoy haciendo un seguimiento de su cartera, simulada con Yahoo Financie apuntando cada compra de la que habla y el precio y los resultados no están nada mal.
Si lo que buscas es información de empresas con muchos datos económicos esta suscripción seguramente no sea para ti… De todas maneras leyendo su blog gratuito te puedes hacer una idea de lo que vas a encontrar en el otro.
Espero haberte ayudado.


Muchísimas gracias por la información. Igual estoy unos meses de prueba a ver qué tal van sus recomendaciones.

Muchísimas gracias por la info.

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Reinvesting Coca-Cola Dividends For Half A Lifetime



The Robert Wood Johnson Foundation’s Liquidation of Johnson & Johnson Stock


For you, the lesson to take home is that there can be something of a false security that can be found when searching for sophisticated strategies or brand-name hedge funds. Once you hand your hard-earned money to a hedge fund manager or some other investment selector, there is still a requirement to pick an ultimate investment. More times than not, this means common stock, preferred stock, or bonds. And if you are paying a substantial fee for these investments, there can be even greater pressure to avoid investing in the so-called obvious blue-chip stocks because there can be a human tendency to assume that “complexifying” affairs must carry some wealth-creating benefit for being clever.

Nope! Someone who is quietly investing $300 per month in Johnson & Johnson stock every month like clockwork year after year has, and will continue, to achieve higher compounding rates than the Robert Wood Johnson investment fund.


Wells Fargo Stock Investors: Betting Big On The Bank


“Right now, Wells Fargo is yielding over 4% (based upon a stock price of $49 per share). As part of the Fed’s limitations on its capital return policies, namely dividends and share repurchases, Wells Fargo is storing capital at a higher rate that will be unleashed in the future. It is positioning itself for long-term earnings per share growth of 7.5% with dividend hikes accordingly. For a yield that starts at slightly above 4%, high single-digit dividend growth and earnings per share growth over the long-term is likely to be a recipe for 10-12% annual returns. Given that Wells Fargo is already a trillion-dollar bank in terms of assets, that would be a colossal achievement. I expect that a day will come when all the heavy betters on Wells Fargo stock will have a period of sharp outperformance when the investor community wakes up and chooses to recognize that Wells Fargo and JP Morgan are coastal twins and deserve the same valuation.”


“I think the financial side of an investment portfolio can be fully satisfied by stocking up on some of the following: Visa, Mastercard, Discover Financial Services, Wells Fargo, JP Morgan, US Bancorp, and M&T Bank because those companies possess economies of scale and generally entrenched business models that won’t be leaving us anytime soon” The Conservative Income Investor


Yo tenía WFC en el radar ya hace un tiempo y después de leer el artículo he acabado abriendo posición.


Aparte de la opinión de este hombre que le veis a WFC?

He mirado su histórico y corto dividendo en la crisis por tanto lleva 9 años de incremento de dividendo.

Su beneficio por acción se mantiene entorno a los 4$ en los últimos 6 años apenas ha crecido.

La parte buena es que su yield es alto.

El ROE no está mal, un 10-11% de media.
Han hecho recompras de acciones en estos últimos diez años así que esto también sería positivo.

A mí con los criterios de compra que tengo no me encaja pero es posible que de me escape algo, más bien seguro que se me escapa algo.




Wells Reports a Tough Fourth Quarter: More Legal Charges, and Future Expense Outlook Is Cloudy

Wide-moat Wells Fargo reported poor fourth-quarter results, largely attributable to a $1.5 billion legal charge in the quarter as well as elevated expenses in other parts of the bank. While we hadn’t made any predictions about the amounts of future operating losses, we did expect that several outsize legal charges were on their way, which is exactly what happened in both the third and fourth quarters. Given that the bank has not announced a final wave of settlements, we think it is important for investors to brace for more potential charges.

Wells also missed its overall expense guidance, which excludes excess operating losses. Adjusted noninterest expense came in at $53.7 billion compared with a goal of $53 billion. Overall, we think it is important to focus on what information was actually new versus the information that was simply negative, but predictable. Booking more legal charges was somewhat predictable, although the exact amount was a new piece of information. Missing expense guidance was also a new piece of disappointing information, although it seems that the reasons for the miss are arguably transient (outside professional services, impairments and write-downs, and severance charges). We’ll be eagerly awaiting a new outlook from management as it completes internal reviews, but in the meantime, besides bumping up our operating loss outlook for the medium term, we don’t see much that has fundamentally changed.

We think it is clear that Wells is still a work in progress, and that progress will takes years, not months. After making several adjustments to our projections, largely related to slightly higher expenses in the future, we are lowering our fair value estimate to $56 per share from $57.





A Boeing la estoy esperando yo por debajo de 300. Me aferro a la combinación presentación de resultados + nuevo CEO para ello.

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Salvo que me dé por completar la posición en BPY, Boeing es la principal candidata para comprar en los próximos meses. Con el precio que tiene ahora ya me va bien, pero si baja de 300 (temporalmente :smiley:) pues mejor.


No lo comenté al final, pero también entre el viernes en Wells Fargo.

Pues a escoger no sé cuál sería peor, los españoles o los de por aquí.

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There is a passage in Jeremy Siegel’s “[Stocks For The Long Run] that I regard as one of the most important passages in shaping my investment orientation:

For his new work, Siegel searched through the Standard & Poor’s 500 Index to find patterns among the winners and losers. “I was frankly shocked that Philip Morris would be the number-one stock,” Siegel said. “I would just never have guessed that. I would have said, ‘Maybe IBM.’” From 1925 through the end of 2003, tobacco company Philip Morris, now called Altria Group, delivered a 17% average annual return, assuming all dividends were reinvested in the company’s shares. That beat the average stock by 7.3 percentage points a year. A $1,000 investment in Philip Morris in 1925 would now be worth more than a quarter of a billion dollars.

Similarly, consider a choice available to an investor in 1950 who could have put money into the most cutting-edge company of the day, computer maker IBM, or the numbingly ordinary Standard Oil of New Jersey. Even today, most investors would assume IBM was the best bet. Indeed, according to the most widely watched measures of growth, IBM was the winner over the next 53 years, dramatically outstripping Standard Oil in per-share growth of revenue, dividends and earnings.

But Standard Oil shareholders did better, with average annual returns of 14.42% versus 13.83% for IBM. That half-point difference, compounded over 53 years, put the oil-company shareholders ahead by more than 25%. A $1,000 investment in Standard Oil would have grown to $1.26 million, compared to less than $1 million for an equal investment in IBM.

Siegel found similar results again and again. Since 1950, the top-performing companies were National Dairy Products (now Kraft Foods), returning 15.47% a year; R.J. Reynolds Tobacco, 15.16%; Standard Oil of New Jersey (now ExxonMobil), 14.42%; and Coca-Cola, 14.33%. A $4,000 investment in the top four would have grown to $6.29 million, versus $1.11 million for a similar investment in the stock market as a whole.

Earlier today, I did what I’ve done most often over the past several months–purchased more shares of ExxonMobil (XOM) and Imperial Brands (IMBBY). For now, I am reinvesting the shares of both.

Investing is not merely a game of identifying the best company. Nike is one of my favorite companies in the world, and seems probable to deliver double-digit earnings per share growth annually over the next decade, but the P/E ratio is 37. If a deep recession or a stock market crash were to strike tomorrow and the stock experienced a 50% decline to the $50 range, the P/E ratio would still be around 18x earnings. That would be nothing out of the ordinary about that–heck, investors had six different years out of the past twenty when the stock traded at such a valuation. The stock price has the opposite of a margin of safety–it is treating future profits as though they have already arrived.

This happens over and over because investors use “recent price history” to inform their views of what will happen in the future. Nike was at $50 in 2015, $80 in 2018, and $103 in 2020 while the profits have been growing at a double-digit rate so it “feels good.” You get all the confirmation bias in the world when that occurs.

But it ignores the inquiry that will determine our future returns: What are the claims on profit that I am receiving when I outlay capital now, what will be the growth rate for that profit, and what will be the capitalization rate for that profit at the end of my compounding period?

With Nike right now, you are getting a 2.8% return on your profit that is probably going to grow at a high single-digit or low double-digit rate into the next decade and the P/E ratio will be probably come down to 20x earnings. The stock price has been exceeding the profit growth by five percentage points annualized for several years, and those premature gains will inhibit future returns.

My view is that I have to protect capital. I had a family acquaintance who worked at Russell Stover since the 1990s in Western Missouri. She gave them twenty years of her life, clawing up from a $40k annual salary to a $50k-ish annual salary over the past thirty years. Last week, she received that there were going to be several hundred layoffs in the area, and that she will be included. That sticks with me because it shows me exactly how “hard fought” money is to come by.

Right now, the average American household generates $59,039 in annual income and has a savings rate of 6.5%. That is $3,837.47 in surplus that can be used towards a better tomorrow. For someone who earns $20 per hour, that is 191 hours that the surplus represents. That is sacred to me. I’m not obsessed about money–I’m obsessed about the underlying labor in which someone sells the most precious asset we possess (time) in exchange for compensation. I take money seriously because it is the byproduct of our most precious resource.

The implication is that I don’t think about $3,837.47, or any allocation of capital, as just money. In this scenario, I would view it as “I have 191 hours of my life that I sacrificed, what am I going to do to make it worth it?”

The consequence of taking capital seriously is that I insist on thinking about as investment as safely and rationally as I possibly can. When I try to learn from investment mentors like Warren Buffett, I read their life story with a critical eye. I don’t just assume that every decision he made along the way was the most optimal (for instance, I come to the conclusion that he should have purchased National Indemnity in 1967 through the Buffett Partnership instead of Berkshire Hathaway because then he would have continued to earn fee overrides on all of the subsequent businesses that National Indemnity was able to fund and it wouldn’t have had to be shared with the “random” pre-existing shareholders of Berkshire Hathaway).

It also means that I have to avoid the various versions of recency bias that can cloud perception. I don’t lower my standards and purchase subpar companies just because they seem fashionable. I don’t avoid buying more shares of ExxonMobil and Imperial Brands just because of a vague notion that it’s “time for something new.” If they’re the best risk-adjusted compounders, they’re the best risk-adjusted compounders, and I will continue to allocate investment dollars to them as long as it remains true.

In the case of Exxon, I believe the stock is worth somewhere between $85 and $105 per share. The current price of $66 per share implies undervaluation of roughly 25% to 50%. Finding a truly undervalued business in this climate of frothy markets is a tremendous blessing because frothy markets don’t last forever. The United States is already approaching over a decade of economic gains. That is the longest period of such growth in the history of our country. I don’t profane prosperity, but I am not going to delude myself into pretending that another 1973-1974 or 2008-2009 or even a mild 1990-1991 won’t or can’t occur just because things are progressing well now.

This brings us back to the philosophical underpinnings of the “margin of safety” principle. It matters because wealth gets destroyed during market corrections when valuations shift. Those who lose the most money are those who own overvalued stocks heading into a decline. This is because the stocks lose money during the transition from overvaluation to fair valuation and then lose money from fair valuation to undervaluation.

I accept the latter (losses from fair value to undervaluation shifts) because the volatility is the admission fee for the prospect of double-digit purchasing power gains through passive investments. But losses from overvaluation to fair valuation shifts are a product of the market participants sifting out the fool’s gold from the real gold–and if I buy an overvalued stock, I am in effect by some x% of fool’s gold and hoping that some other market participant is fooled into thinking it is the real thing.

Returning to ExxonMobil, it is a tremendous starting point to purchase an ownership stake in a business that is selling for a ¼ or ½ discount from its fair value. If a recession were to strike, Exxon stock would have to fall from a position of undervaluation to a position of even more undervaluation. There are many fewer steps on those stairs to fall than what the overvalued Nike investor would endure under the same circumstances. Put it bluntly, if Exxon were to fall 50%, it would be yielding 10.4%. Not saying that is not possible, but Standard Oil/Standard Oil of New Jersey/Exxon/Exxon Mobil has only fallen to that type of valuation level for 6 months in the past 138 years.

Exxon singlehandedly has as much proven oil reserves as China (Exxon has 24 billion barrels of proven oil reserves, China has 25 billion barrels). If you exclude state-owned oil companies, it is the largest energy company in the world. Typically, there is a premium associated with owning the safest business in the industry.

The reason that is not the case right now, I suspect, is because Exxon is a major oil, chemical, and natural gas firm, and it produces 9.4 billion cubic feet of natural gas daily and natural gas is around $2 right now. The other industry participants do not have the natural gas exposure, and therefore, trade at a higher premium valuation. I admire Exxon’s extreme diversification and ability to generate funds from all energy sources–it’s the “Berkshire Hathaway” of energy. To me, it’s obvious that owning several major cash generators carries an enhanced risk that a particular cash generator will be outperforming at some time, but it is worth it because in the aggregate there are profits coming in from elsewhere to keep you marching forward.

The successful application of this concept was how Buffett and Munger were able to thrive in the 1970s–the $1.7 million losses from the Buffalo Evening News could be absorbed because there were $6 million See’s Candies profits that could plug in the loss and fund further investment in Wesco. Then, when the Buffalo News turned a profit, the Washington Post investment could occur, etc.

In the case of Exxon, it is all about economies of scale. There is no brand here in the sense that no customer prefers Exxon Oil over Chevron Oil in the sense that someone might prefer Coca-Cola to Vess. It’s all about low-cost production. In the coming ten years, Exxon is ramping up oil production in the Permian Basin, Brazil, Mozambique, Papa New Guinea, and Brazil. This means that Exxon Mobil will stand to produce its oil-equivalent per day production by roughly 40% over the next ten years.

That is astounding. Right now, every minute that goes by, Exxon produces 1,596 barrels of oil and oil equivalents. For every share you buy, you get a one out of 4.2 billionth claim on the profits from those 1,596 barrels of production per minute. Over the course of the next ten years, I expect each share to represent 2,250 barrels per minute. In other words, 3.5% annual production growth.

From 1988 through 2020, ExxonMobil also repurchased 2.8% of its stock annually. The starting dividend right now is 5.2%. This puts investors in the position of looking at 11% annual returns over the long haul subject to whatever happens to the price of oil.

And don’t forget about those dividends. Jeremy Siegel pointed out that low prices, coupled with dividend reinvestment, is the “total return accelerator.” Your family will be richer if Stock X trades at $66 and pays out a 5.2% dividend and grows that dividend at 8% if the stock price stays at $66 for a couple years than if it goes up to $100 immediately. People know this academically, but then pout when the capital appreciation doesn’t come right away. Prolonged undervaluation, coupled with either the imposed force of dividend reinvestment or share repurchases, builds your family’s treasury. Don’t let the emotionalism of enjoying a rising stock price detract you from rationally seeking the conditions that maximize compounding.

In a way, Exxon’s current situation is reminiscent of what occurred from 2010-2014. In 2010, the stock was in the $60s. By 2014, the stock had shot up to $100. For those that reinvested their growing dividends during this time period, they ended up with 17.5% annual returns during the time-frame. And Exxon was only yielding 2.6% in 2010 compared to 5.2% today. If the current payout were superimposed on the 2010-2014 compounding period, those annual returns would have been 20% annually. I would not expect anything like 20% compounding long-term, but the conditions are in place for “super compounding” in the double-digit range.

Exxon’s competitive advantage is that it is essentially the only private-sector energy company that can pour $20 billion investments into individual projects in individual countries. This leads to efficiency in extraction that gives it a low-cost producer advantage which is why Wal-Mart, Southwestern Airlines, and GEICO (prior to Berkshire’s acquisition) were able to deliver superior results compared to all of their peers. The current valuation of Exxon is the rare occurrence where the mightiest business in the sector is trading at the lowest price. I view it as a pitch down the middle and I want to add enough capital to the investment to make it a five-hundred foot home run. I’m in it for the long haul as a reinvestor, and I expect that it will prove the adage “the stock market is a wealth transfer mechanism from the impatient to the patient.” The dividend has a demonstrated track record of annual growth, and is already starting from a high base, so I’m content with the cash alone. Gobbling up additional undervalued shares in one of the best corporations in the entire world is fine with me if the conditions persist for an extended time period.

Elsewhere, I am continuing to buy shares of Imperial. It can be easy to ignore when shares of a stock just seem to be “trading in the $20s”, but the move from $21 to $26 recently marked a 20% gain in a matter of months for the stock. Plus, there was a $0.947 dividend during this time period, which single-handedly was a 4.5% return on the cheapest shares I bought.

In some sense, I could have led a perfectly fine investment life without touching Imperial Brands. It’s not one of those “Inevitables” (stocks that I want to own for a lifetime, just a matter of finding the right valuation like Brown Forman, Berkshire Hathaway, Visa, Coca-Cola, ExxonMobil, Disney, and despite my criticism above, Nike). It’s more like when I purchased Bank of America at $7-$11 per share while in college–a darn-good company that isn’t best in breed but the discount to fair value is so extreme that you get to capture both “value investing” margin of safety principles and “time is the friend of the wonderful business” principles in a favorable admixture.

Reynolds and the old Philip Morris were the supercompounders of the American 20th century. More than anything else, Imperial Brands continues to trade like the old Philip Morris did during the 1990s tobacco litigation when the stock of the old Philip Morris got so cheap it went on to compound at a 19% clip over the subsequent twenty years, counting all spin-offs. While I do not expect those types of rosy results from Imperial, good things tend to come to those who get 9% cash payouts that are supported by profits presently and those profits are also growing at a moderate mid-digit pace.

I am a happy camper. Benjamin Graham said that, no matter the conditions, there is always something intelligent to do. I find it annoying but understandable when investors complain about prosperity by saying they can’t find any good deals out there, but you only have to find one good idea at a time to be a compounder. I am satisfied that Exxon and Imperial at trading at prices that I would consider favorable even if we weren’t living in a through-the-looking-glass world with the way some prognosticators are projecting recent successes indefinitely into the future. Wealth is made when you stick to the script of acquiring real profits from real businesses at low ownership entry prices.


Lo único que se le puede echar en cara a este hombre es a veces su baja capacidad de síntesis. Por lo demás, es oro puro.


Y hasta reparte una colleja a todos los que nos creemos unos genios de la inversión porque nuestras acciones se revalorizan un tropecientos por ciento

And don’t forget about those dividends. Jeremy Siegel pointed out that low prices, coupled with dividend reinvestment, is the “total return accelerator.” Your family will be richer if Stock X trades at $66 and pays out a 5.2% dividend and grows that dividend at 8% if the stock price stays at $66 for a couple years than if it goes up to $100 immediately. People know this academically, but then pout when the capital appreciation doesn’t come right away. Prolonged undervaluation, coupled with either the imposed force of dividend reinvestment or share repurchases, builds your family’s treasury. Don’t let the emotionalism of enjoying a rising stock price detract you from rationally seeking the conditions that maximize compounding


No creo que se esté refiriendo al Santander o al BBVA, :rofl:


Esos los trata en un blog paralelo: The Risky Value Investor :wink: