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Strategies & Market Trends : Dividend investing for retirement

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To: Paul Senior who wrote (16543)	8/3/2014 10:51:31 AM
From: E_K_S	Read Replies (2) of 34328

Re: Waste Management, Inc. (WM) - peeled off more shares to raise cash Decided to book some LT capital gains and raise a bit more cash. WM missed on Q1 earnings & w/ one time adjustments missed on Q2 earnings. They are however, divesting themselves of un-profitable service areas (ie. Puerto Rico) and selling some non core operations ( Wheelabrator Technologies Inc for $1.94Bln) but the company still carries a lot of debt. Too much debt for me. This is especially true when you look at their net annual income to LT debt which is very high even after the $1.94Bln infusion from their Wheelabrator Technologies Inc sale. Their forward PE at 17.25x is high and both BV and capital investment(s) have decreased. WM's payout ratio is 557% according to Schwab so I find it difficult to see how they can raise or even sustain their current dividend. At 3.38% they are the highest in the sector w/ RSG paying 2.75%. Their return on equity at 2.01% seems low considering they are like a monopoly and should be able to maintain their pricing power. I will hold onto my small position (bought 150 @ $34.15/share 8/10/2010; bought 350 @ $29.96 11/21/2011; sold 150 @ $34.50/share 1/25/2012; sold 150 @ $43.17/share 8/13/2013; sold 100 @ $44.40 8/1/2014) of 100 shares from my 11/21/2011 buy and look for a possible re-entry below $35.00/share and/or a PE at/near 10x. The proceeds from this sale will go into another dividend payer w/ a better balance sheet specifically one w/ lower debt, a more reasonable dividend payout ratio and better long term growth potential. EKS

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