LONDON -- Global premium-drinks company Diageo (LSE: DGE ) (NYSE: DEO ) has been a stellar investment over the years. Does this big blue chip have much further to rise, or are its growth days over? Let's have a look.
Track record
Diageo has delivered a storming performance for investors. In the last year, its shares have risen 30%. In the last five years, the shares have doubled. However, there are signs that this huge outperformance may be over. In the last three months, shares in this super-brewer have trailed the FTSE 100. While the FTSE is up 3.9%, Diageo is only 1.1% ahead.
What cannot be in doubt is Diageo's quality as a company. Shareholder dividends have been increasing every year since 1998. In fact, the payout is up nearly fourfold in that time. Sales and earnings per share have also increased year on year for the last five years. Diageo is one of the U.K.'s most successful companies.
Valuation
Go back two years, and Diageo shares were trading around 1,300 pence. The company had just completed a year in which it earned 68.3 pence per share and declared a dividend of 38.1 pence. That put the shares on a historic price-to-earnings ratio of 19 and a past yield of 2.9%. In May 2011, shares in Diageo traded at 15.7 times the full-year EPS. The 2011 dividend equated to a 3.1% yield.
Top 5 Supermarket Stocks To Invest In Right Now: Visa Inc.(V)
Visa Inc., a payments technology company, engages in the operation of retail electronic payments network worldwide. It facilitates commerce through the transfer of value and information among financial institutions, merchants, consumers, businesses, and government entities. The company owns and operates VisaNet, a global processing platform that provides transaction processing services. It also offers a range of payments platforms, which enable credit, charge, deferred debit, debit, and prepaid payments, as well as cash access for consumers, businesses, and government entities. The company provides its payment platforms under the Visa, Visa Electron, PLUS, and Interlink brand names. In addition, it offers value-added services, including risk management, issuer processing, loyalty, dispute management, value-added information, and CyberSource-branded services. The company is headquartered in San Francisco, California.
Advisors' Opinion:- [By Anora Mahmudova]
American Express Co. (AXP) �shares gained 3.6% after the credit card company said its fourth-quarter earnings more than doubled. Shares in rival Visa Inc. (V) � rose 4.7%
- [By Sean Williams]
And then there's payment processing company Visa (NYSE: V ) , perhaps one of the very few long-term investments you can get charged up about that combines the potential for rapid growth with consistency in nearly all economic environments. The way I see it, Visa has five opportunities that put it at the head of the class.
Top Blue Chip Stocks To Buy For 2014: McDonald's Corporation(MCD)
McDonald?s Corporation, together with its subsidiaries, operates as a worldwide foodservice retailer. It franchises and operates McDonald?s restaurants that offer various food items, soft drinks, coffee, and other beverages. As of December 31, 2009, the company operated 32,478 restaurants in 117 countries, of which 26,216 were operated by franchisees; and 6,262 were operated by the company. McDonald?s Corporation was founded in 1948 and is based in Oak Brook, Illinois.
Advisors' Opinion:- [By Jim Jubak]
Energy stocks, well, I don�� see oil moving up a whole lot. It doesn�� look like it is going to be necessarily a bad time for energy stocks because oil is going to be dropping, but I don�� see a whole lot of energy in the sector. But the real problem, I think, is consumer stocks. These are kind of like the safe stocks that people go to when they want to be in the market but they��e a little worried about the market. You know the stocks I mean, McDonald�� (MCD), Coca-Cola (KO), Pepsi (PEP), the companies that have theoretically steadily growing earnings. The problem is we��e had a lot of bad news from those stocks in the fourth quarter and in, sort of, month-to-month figures from companies like McDonald�� for January and February that we��e not seeing much in the way of growth. Two problems there, one of which is sort of general, which is that we��e not seeing a whole lot of increases in growth, sort of acceleration in the growth rate in emerging markets. In fact, we have seen a deceleration, and that has had an effect on companies like McDonald��. The other is that we��e battling some individual, or sector trends, so that McDonald��, for example, is fighting against a lot more competition, in the sense that, for some percentage of the market, they are really not very exciting anymore as destination restaurants. For Coke and Pepsi, we��e dealing with the fact that cola drinks and sweetened fizzy drinks, in general, are sort of losing market share, again, losing some pizzazz. If you look at all of these sectors and say, ��kay, so what�� going to drive the market higher from here,��a lot of the sectors that were doing the job in January, and the first half of February, seem to have run out of gas, and that may leave us with very little, other than technology, and it�� hard to see technology being sufficient in and of itself to drive the market from here and that is what I �� look for in the week ahead, what�� our leaders
- [By Dan Burrows]
Stocks to Sell: McDonald’s (MCD)
Strange as it may seem, McDonald’s (MCD) stock hit a record high very recently even as the fast-food chain struggles with ongoing sales weakness in the U.S. MCD stock touched $103.78 this week as part of its 6% gain for the year.
- [By Mick Weinstein]
��What does McDonald's (MCD) �need to do to recover its momentum?
- [By Oliver Pursche]
Overnight central-bank intervention by the People's Bank of China helped reverse a spike in yields, easing market concerns and reversing some early trading losses in Asian markets. U.S. equity futures are pointing to a higher open, as investors await key earnings reports from the likes of Verizon (VZ) , IBM (IBM) , Lockheed Martin (LMT) and McDonald�� (MCD) �this week. Market participants will also be focused on key economic data being released later this week, including Thursday's existing-home sales and home-prices reports, and PMI data.
Top Blue Chip Stocks To Buy For 2014: Apple Inc.(AAPL)
Apple Inc., together with subsidiaries, designs, manufactures, and markets personal computers, mobile communication and media devices, and portable digital music players, as well as sells related software, services, peripherals, networking solutions, and third-party digital content and applications worldwide. The company sells its products worldwide through its online stores, retail stores, direct sales force, third-party wholesalers, resellers, and value-added resellers. In addition, it sells third-party Mac, iPhone, iPad, and iPod compatible products, including application software, printers, storage devices, speakers, headphones, and other accessories and peripherals through its online and retail stores; and digital content and applications through the iTunes Store. The company sells its products to consumer, small and mid-sized business, education, enterprise, government, and creative markets. As of September 25, 2010, it had 317 retail stores, including 233 stores in the United States and 84 stores internationally. The company, formerly known as Apple Computer, Inc., was founded in 1976 and is headquartered in Cupertino, California.
Advisors' Opinion:- [By Doug Ehrman]
The lukewarm reception that greeted the Samsung Galaxy S4 has opened the door for competitors. The HTC One, for example, has been very well received. The question for Apple (NASDAQ: AAPL ) investors is whether having two viable alternatives is collectively worse than just one. Much as two franchise locations across the street from each other may steal sales from each other, but ultimately have higher collective revenues, there is a real risk that two foes may hurt Apple.
- [By Rick Munarriz]
The news is worse for Apple (NASDAQ: AAPL ) , which is the only one of the four largest PC companies in this country to see its domestic market share decline. Losing share in a shrinking pie isn't a good place to be.
- [By Evan Niu, CFA]
Japan's top carrier NTT DoCoMo (NYSE: DCM ) has never offered Apple's (NASDAQ: AAPL ) iPhone, and that's not about to change anytime soon. NTT DoCoMo exec Kazuto Tsubouchi recently compared the device to DisneyLand, using the theme park as a comparison for a walled garden. The carrier would prefer to have more control over the experience, something that Apple isn't willing to give up.
Top Blue Chip Stocks To Buy For 2014: Philip Morris International Inc(PM)
Philip Morris International Inc., through its subsidiaries, engages in the manufacture and sale of cigarettes and other tobacco products in markets outside of the United States. Its international product brand line comprises Marlboro, Merit, Parliament, Virginia Slims, L&M, Chesterfield, Bond Street, Lark, Muratti, Next, Philip Morris, and Red & White. The company also offers its products under the A Mild, Dji Sam Soe, and A Hijau in Indonesia; Diana in Italy; Optima and Apollo-Soyuz in the Russian Federation; Morven Gold in Pakistan; Boston in Colombia; Belmont, Canadian Classics, and Number 7 in Canada; Best and Classic in Serbia; f6 in Germany; Delicados in Mexico; Assos in Greece; and Petra in the Czech Republic and Slovakia. It operates primarily in the European Union, Eastern Europe, the Middle East, Africa, Asia, Canada, and Latin America. The company is based in New York, New York.
Advisors' Opinion:- [By Garrett Baldwin]
As the world's second-largest tobacco company, Philip Morris International (NYSE: PM) is an ideal sin stock.
And with numbers like these, it's also an ideal way to play global growth...
- [By Jonas Elmerraji]
As the second-largest tobacco company in the world, $137 billion cigarette company Philip Morris International (PM) has the whole "sin stock" thing down pat. PM owns nearly a third of the ex-China market for cigarettes, with some of the most popular global brands under its corporate umbrella. At the top of the pack is the firm's flagship Marlboro label, which accounts for more than a third of volume. Other brands include L&M, Philip Morris, and Parliament.
But don't mistake PM for the company manufacturing Marlboro cigarettes here in the U.S. -- this firm, which spun out from Altria (MO) in 2008, is 100% ex-U.S. That's actually spectacular positioning, because it means that PM is the part of legacy Altria's tobacco business that's actually still growing. At the same time that cigarette sales here in the U.S. die a slow death, PM's emerging market business is seeing quick growth rates. The combination of a sticky product (consumers don't tend to switch cigarette brands often), and premium positioning with Marlboro means that PM earns thick net profit margins (28% last year) for its trouble.
The strong dollar has been a thorn in PM's side in the last few years -- since the firm earns revenues in local currencies and then reports in dollars, any upside in the greenback presents currency risk. Even so, growth in the firm's core emerging markets has outpaced the dollar's climb in this environment. Another mitigating factor is PM's huge 4.5% dividend yield -- with low interest rates likely to persist for some time, that yield should look increasingly attractive as time wears on.
Must Read: 5 Big Stocks to Trade for Gains as QE3 Ends - [By Editor , Dividend Growth Investor]
Philip Morris (PM), through its subsidiaries, manufactures and sells cigarettes and other tobacco products. The company has paid and consistently increased dividends every year since being spun-off from Altria Group (MO) in 2008. The last dividend increase was in September 2013, when the Board of Directors approved a 10.60% dividend increase in the quarterly distribution to 94 cents/share.
Top Blue Chip Stocks To Buy For 2014: Chevron Corporation(CVX)
Chevron Corporation, through its subsidiaries, engages in petroleum, chemicals, mining, power generation, and energy operations worldwide. It operates in two segments, Upstream and Downstream. The Upstream segment involves in the exploration, development, and production of crude oil and natural gas; processing, liquefaction, transportation, and regasification associated with liquefied natural gas; transportation of crude oil through pipelines; and transportation, storage, and marketing of natural gas, as well as holds interest in a gas-to-liquids project. The Downstream segment engages in the refining of crude oil into petroleum products; marketing of crude oil and refined products primarily under the Chevron, Texaco, and Caltex brand names; transportation of crude oil and refined products by pipeline, marine vessel, motor equipment, and rail car; and manufacture and marketing of commodity petrochemicals, plastics for industrial uses, and fuel and lubricant additives. It a lso produces and markets coal and molybdenum; and holds interests in 13 power assets with a total operating capacity of approximately 3,100 megawatts, as well as involves in cash management and debt financing activities, insurance operations, real estate activities, energy services, and alternative fuels and technology business. Chevron Corporation has a joint venture agreement with China National Petroleum Corporation. The company was formerly known as ChevronTexaco Corp. and changed its name to Chevron Corporation in May 2005. Chevron Corporation was founded in 1879 and is based in San Ramon, California.
Advisors' Opinion:- [By Kelley Wright]
Chevron (CVX) is just a beast. There's a lot to like here: A $4.00 per share dividend; an S&P ��+��Quality Ranking, and a Dividend Aristocrat to boot. A must position for a quality portfolio.
- [By Laura Brodbeck]
Friday
Earnings Expected From: Chevron Corporation (NYSE: CVX), Procter & Gamble Company (NYSE: PG), Clorox Company (NYSE: CLX) Economic Releases Expected: U.S. ISM Manufacturing PMI, U.S. nonfarm payrolls, U.S. unemployment rate, British manufacturing PMI, eurozone manufacturing PMI, German manufacturing PMI, French manufacturing PMI, Italian manufacturing PMI, Spanish manufacturing PMIPosted-In: Earnings News Previews Global Economics Pre-Market Outlook Markets Trading Ideas Best of Benzinga
- [By Ben Levisohn]
It was a good news, bad news kind of day for Chevron (CVX) yesterday, after it told investors that it would meet guidance for the third quarter but that its profit would plunge 31% from a year ago during the fourth.
ReutersUnlike last year, when Chevron’s refining business was a drag on earnings while its so-called upstream business fired on all cylinders, now refining is providing the boost. That’s good news for Exxon Mobil (XOM) and refiners, says Morgan Stanley’s Evan Calio and Manav Gupta. They explain:
We believe capture rates [how much of the difference between the cost of oil and refined products a company can earn. Ed. ] troughed in 3Q13 and most US refiners will show a quarter-over-quarter improvement as differentials were widening and the WTI curve moved to contango from backwardation. Positive refining revisions will positively impact [Exxon Mobil] more than [Chevron], as�[Exxon Mobil] has significantly more absolute N. American refining capacity. Marketing margins [the margins from selling the finished product to the retail market. Ed.] also improved 17% q/q and 32% q/q on [West Coast] and [Gulf Coast] respectively, a positive indicator for refiners with retail operation [(Marathon Petroleum (MPC), Tesoro (TSO), Phillips 66 (PSX), Western Refining (WNR) & Delek US (DK))].
Shares of Chevron have dropped 2% to $1220.77, while Exxon Mobil has fallen 0.4% to $99.37, Marathon Petroleum has dipped 0.3% to $90.79, Tesoro has declined 1.3% to $57.23, Western Refining has slipped 1.2% to $40.79 and Delek US has dropped 1.7% to $33.31. Phillips 66 is little changed at $78.15.
Top Blue Chip Stocks To Buy For 2014: International Business Machines Corporation(IBM)
International Business Machines Corporation (IBM) provides information technology (IT) products and services worldwide. Its Global Technology Services segment provides IT infrastructure and business process services, including strategic outsourcing, process, integrated technology, and maintenance services, as well as technology-based support services. The company?s Global Business Services segment offers consulting and systems integration, and application management services. Its Software segment offers middleware and operating systems software, such as WebSphere software to integrate and manage business processes; information management software for database and enterprise content management, information integration, data warehousing, business analytics and intelligence, performance management, and predictive analytics; Tivoli software for identity management, data security, storage management, and datacenter automation; Lotus software for collaboration, messaging, and so cial networking; rational software to support software development for IT and embedded systems; business intelligence software, which provides querying and forecasting tools; SPSS predictive analytics software to predict outcomes and act on that insight; and operating systems software. Its Systems and Technology segment provides computing and storage solutions, including servers, disk and tape storage systems and software, point-of-sale retail systems, and microelectronics. The company?s Global Financing segment provides lease and loan financing to end users and internal clients; commercial financing to dealers and remarketers of IT products; and remanufacturing and remarketing services. It serves financial services, public, industrial, distribution, communications, and general business sectors. The company was formerly known as Computing-Tabulating-Recording Co. and changed its name to International Business Machines Corporation in 1924. IBM was founded in 1910 and is based in Armonk, New York.
Advisors' Opinion:- [By John Divine]
The major laggard of the day and, in fact, the reason that the Dow struggled to stay positive despite its overwhelming bullishness was IBM (NYSE: IBM ) . IBM lost 8.3% -- its worst single-day stumble in eight years -- after a quarter where revenues declined 5%. The only silver lining to today's report is that results were hit more by currency headwinds from a weak yen than inherent weakness in the underlying business.
- [By Alex Planes]
Key to 3.0's success was Microsoft's ability to convince many early PC-makers to pre-install the operating system on machines before they reached consumers. Although IBM (NYSE: IBM ) and Compaq (now part of Hewlett-Packard) refused to commit to pre-installs -- IBM was still trying to push its 3-year-old OS/2 (an early Windows competitor), and Compaq's general policy opposed all pre-installs at the time -- Microsoft still managed to assemble a lineup of 30 computer makers, virtually none of which still make computers today, to include Windows 3.0 on machines out of the box. The $150 operating system sold 100,000 copies in its first two weeks on the market, and 4 million PCs were running Windows 3.0 by the end of its first year on the market.
- [By Mark Morelli]
Positive trends have Silicon Valley tech giants Apple (NASDAQ: AAPL ) , Facebook (NASDAQ: FB ) , and the century-old�International Business Machines (NYSE: IBM ) �poised for future success in each of their diverse, but somewhat interrelated, businesses.�
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