Taking Profits, Raising Limits

Several of our Global Income Edge Conservative Portfolio holdings have hit or have exceeded their full values.

In some cases we’re taking profits, and in some cases we’re raising our price limits.

Taking Profits

Sell Philip Morris International (NYSE: PM) for a gain of 19% (all gains are since initial recommendation). Add a dividend yield of 4.18% and it’s a holding that has delivered a total return of 23% in our portfolio.

Though addicted to the steady income, it’s time to quit cold turkey on a business that has declining margins as more of the world becomes smoke-free.

Sell Verizon (NYSE: VZ) for a gain of almost 11%. With a dividend yield of 4.22% that’s a total return of 15%.

Verizon is a solid company. but we haven’t been happy with the volatility in the stock and there are other telecoms in the portfolio that we believe are better positioned and better diversified.   

Sell Sempra Energy (NYSE: SRE) for a modest share price gain of almost 3%.

Since we added it to the portfolio last year, Sempra Energy has had some disappointing news with a natural gas leak that we reported on and management guidance for 2016 has been underwhelming.

Raising Price Limits

AT&T  (NYSE: T) is a Buy up to $48

T is up almost 20% since we added it to the portfolio, and the firm sports a 4.94% dividend yield, achieving a total return of almost 25%. The market has clearly recognized the value proposition of the company’s Direc TV acquisition.

We believe the firm’stock will continue it’s upward trend.

Southern (NYSE: SO) is a Buy up to $61

SO is up 18% since we added it to the portfolio. Add a 4.26% dividend yield and that’s a 22% total return.

Southern has been one of America’s truly well run utilities, and with the acquisition of gas utility AGL Resources (NYSE: GAS) we the firm has effectively diversified and will generate higher earnings.

Unilever (NYSE: UL) is a Buy up to $54

UL has been one of the most resilient global consumer staples firms in a difficult global environment. We’ve been impressed with its management and believe the firm will be a great beneficiary of a global recovery.




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