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Strategies & Market Trends : Dividend investing for retirement -- Ignore unavailable to you. Want to Upgrade?

To: Steve Felix who wrote (3474)	1/23/2010 9:35:11 PM
From: chowder	Respond to of 34328

OK, I think I understand. I very rarely use margin. I did last year as I put on a trade in BAC. I made a quick 15% to 20% profit and closed it out. I'm watching AA again. If it pulls back further, I'll use margin to put a trade on for that as well. Will be adding more LMT - yld 3.30% next week and taking a starter position in VFC - yld 3.30% as well. LMT has increased dividends each year for 7 years. This is more of a growth play that also pays a decent dividend. I'm looking for the Navy Strike Fighter contract to help push earnings growth going forward and I want an Aerospace/defense sector play. So, I picked LMT. Their 5 year dividend growth rate has come in at 22.11% Their dividend payout ratio is 30%. So, they have room to expand their business while paying a decent dividend. VFC has 14 years of consecutive dividend increases. I like this because it shows they can continue to increase dividends in bad times as well as good. They continued to raise dividends during the tech crash of 2001, even though share price dropped. And, they also increased dividends during the financial crash of 2008-2009. These are signs of strength, in my opinion. The important thing here for me, is that based on my goal of focusing on increasing the income, these companies are doing that even while share price is dropping in bad times. I can afford to wait for share price to come back and get paid while I wait. I don't plan on selling these companies unless something drastic happens to them fundamentally, or I have to take profits to rebalance them at a later time. As long as cash flows continue to increase and the dividend continues to be increased, share price will follow. Their 5 year dividend growth rate is 20.20%. Their payout ratio is 52%. Since their product line includes Lee and Wrangler jeans, as well as Nautica and several other quality lines, their revenues should improve as the economy improves.