Mike Capombassis

Markets. He does not focus on dividend yield so much as on dividend growth. The US equity market has been in a profit recession for 5 quarters. First quarter this year was the worst quarter for earnings growth. But improvement in earnings for the fourth quarter is largely priced in. Telecom, utilities, energy and materials are the top sectors. He is typically in consumer staples, consumer discretionary and financials. There is a real risk in stocks with a high dividend yield.

He likes it. It does not pay a dividend so he does not own it in his fund. It owns some very valuable properties such as Instagram, which is the growth engine. They spent a billion dollars to acquire Instagram and 4 years later it is one of the fastest growing platforms. They also own Whatsapp. He sees upside, but growth will decelerate. They are investing in the trends of tomorrow.

HD-N vs. V-N. Don’t focus on the current yield. He thinks V-N will deliver 20% dividend growth going forward. HD-N is also a high dividend grower. You need to decide which business you want. He would go with V-N because it is the largest electronic payment network in the world. They just completed the European acquisition and it should be very accretive.

It does not pay a dividend so he cannot own it. It sold off because they disappointed the market in terms of new subscribers. The reasons to own the stock are still the same.

GILD-Q vs. DIS-N. Gild-Q: 7-8 times earnings. HEB-C drug is over 2/3rds of the revenue. The revenue is rolling over a little bit. They need to either get a surprise in the pipeline or acquire somebody. The dividend is safe but won’t grow much.

GILD-Q vs. DIS-N. DIS-N has 20% dividend growth and 15% expected going forward. Their business is growing. Their business model is very sustainable. He is comfortable with a 60 times PE.

They are 18 billion dollars in debt and they cut their dividend in 2014. It has been stable ever since. The market is telling you it is at risk. He prefers T-N (AT&T).

(Top Pick Jun 7/16, Down 3.60%) He is still a fan. The largest and highest quality media company in the world. The scale and diversity of the portfolio is the competitive advantage for the company. They acquired a stake in a company that does live streaming. It offsets cord cutting effect on ESPN.

(Top Pick Jun 7/16, Down, 12.78%) Largest recreation retailer to the hobby ranchers in the US. A weak second quarter was caused by weather. Same store sales were down 0.5% vs. expectations of up 3% and caused the stock to come down.

(Top Pick Jun 7/16, Down 4.29%) They had a great second quarter. They have high customer intelligence. The company has been around about 100 years and paid a consistent dividend for 77 years. Very high quality book.

It does not have a high enough dividend growth for him, but the telecom space has been a big winner. You can buy it at a decent multiple. A solid holding for income.

Largest restaurant chain in the world by sales. It has repositioned itself in the last year or so, so the stock has done well. You get a nice dividend and PE of 20 times earnings. They offer all day breakfast which is a home run for the stock. He likes it.

A higher dividend yielding company. More than 4% dividend and a little bit of growth, but not quite high enough for him. It should do well for the remainder of the year.

He needs three years of dividend history so he could own this. Tim Cook replaced Steve Jobs 5 years ago. It is the most valuable company in the world. The growth is slowing down however and it breaks a thirteen year streak. He would not buy in anticipation of the iPhone 7 release.

One of his newest names, one of the highest quality companies in the world. Going through a merger with DD-N (Dupont). Once completed, they will spin off the business into 3 components. It has a rich dividend and growth. A recession would be the biggest risk, but he doesn’t see one on the horizon. He feels comfortable going forward in rate of dividend growth.