Dividend and Value Investing

 Ticker- CRMT Market Cap- $380 million Car-Mart is currently trading at about $59 a share down from a high of $156 in 2021. It’s currently trading at a massive discount to account receivables as its account receivables per share is $171 after around a 24% allowance for credit loss. Is this discount warranted, or is it a great buying opportunity? America’s Car-Mart is a “buy here pay here” car dealer that sells used cars mainly to “subprime” costumers. This means the costumers buying from them normally don’t have access to credit or have low FICO scores. The average price of a car that Car-Mart sold in 2024 was $19,113 which is up from $18,080 in 2023. Used vehicle prices were up in 2024 because of higher demand and a tight supply of used cars. They have 154 dealerships in 12 different states which is down from 156 dealerships in 2023. To read my full analysis on the company  https://open.substack.com/pub/justavalueinvestor/p/americas-car-mart-trading-at-a-huge?r=2z30yo&utm...

If you’ve ever read a financial article, you’ve probably seen a P/E ratio mentioned. A P/E ratio is a metric a lot of investors use to quickly figure out if a company is expensive or cheap. While using a P/E ratio to quickly look at a stock is a good tool there’s a lot of reasons why you shouldn’t rely on it for valuing a company. What is a P/E Ratio? Photo by Scott Graham on Unsplash A P/E ratio stands for price-to-earnings. It compares a companies stock price to their earnings per share. You can calculate a companies P/E by dividing the stock price by the companies annual earnings per share. For example if a company is trading at $10 a share and has $1 of EPS it’s trading at a P/E ratio of 10. A P/E ratio can be Manipulated  A P/E ratio can be manipulated a couple of different ways. One of those ways can be “creative” accounting. Some companies can shift depreciation policies or by adding a non-recurring gain to the bottom line. While “creative accounting” is legal many...

  In this article I’ll be sharing 3 dividend stocks that have been growing their dividend while still gaining massive capital appreciation. These companies have all grown their net income incredibly quickly over the past 10 years to be able to continue growing their dividends. Photo by Alexander Mils on Unsplash 1- Waste Management ($WM) Waste Management has been paying a dividend for the past 21 consecutive years. They paid 1.50$ per share in dividends in 2014 and have grown it to 2.80$ in 2023. This equals to a 7.18% dividend CAGR (compound annual growth rate). While averaging 7% dividend growth is great it’s actually the lowest CAGR on this list! In 2014 Waste management’s net income was $1.3 billion and in 2023 it grew to $2.3 billion. Their net income almost doubled in this nine year period. They currently have a 46.64% payout ratio so they do have some room to keep on growing it but it may slow down if they invest more heavily into growing the business. 2- Visa ($V) Visa a pa...

 Starbucks released their second quarter earnings yesterday and they do not look pretty. Starbucks missed on revenue, earnings, and same store growth while also lowering their full year guidance. So what happened? Photo by Ricko Pan on  Unsplash Revenue for the second quarter dropped 2% year over year to $8.6 billion and adjusted EPS also came in lower, down 8% to $0.68. Starbucks now expects 2024 revenue growth of low-single digits, down from the previous range of 7% to 10%, which itself was down from a prior guidance of 10% to 12%. This is a terrible look for the company as they have to keep on lowering their guidance. Starbucks has been adding new promotions to their app to try and attract more customers but active members have declined to 32.8 million, compared to 34.3 million last quarter. The CEO said a future area of improvement is their wait times as a lot of customers didn’t complete their orders because of long wait times. The biggest problem Starbucks faced in Q2 w...

  Disclaimer:  Nothing on this blog is intended as financial or investing advice. Please do your own due diligence. Business Overview and Investment Thesis I am currently bullish on VICI as they have continued increasing the size and diversity of their portfolio while still sticking to high quality tenants and properties. Despite this they are trading at a lower P/AFFO then they have historically. They are heavily concentrated in Las Vegas which I think should be a contributing factor for VICI's future growth as tourism has been on the rebound since covid. They have some of the most popular and recognizable properties in their area of expertise (casinos) which include Caesars Palace Las Vegas, MGM Grand, and the Venetian Resort Las Vegas. They have also gained popularity in the dividend investing space as they have a 5.56% dividend yield and have grown their dividend at a 7.6% CAGR while targeting a 75% AFFO payout ratio.  VICI Properties is a real estate invest...

 Amazon has grown its valuation from around a $300 million market cap when it went public in 1997 to now $1.966 trillion, making it the world's fifth most valuable company by market cap. Amazon has been able to do this because of their founder and ex-CEO Jeff Bezos and his drive for success. Jeff Bezos started Amazon as an online bookstore which was meant to compete with brick and mortar bookstores. As this worked out very well by the late 1990s Jeff Bezos decided to expand past just selling books. He also realized how important the internet was going to be and created AWS in 2006 for cloud computing which now makes up about half of Amazon's revenue. Amazon says their mission goal is to be “Earth’s most customer centric company”. They also say they want to be Earth’s best employer and Earth’s safest place to work. They are incredibly customer centric as their claim to fame is their 2 day shipping and they have an incredible return policy in which almost all items can be returne...

 Realty Income may be the most popular dividend stock on the internet. Realty Income is a REIT which specializes in triple net leases in single tenant commercial properties it currently has a 5.72% dividend yield. In this article I’ll share 3 reasons why dividend investors love this dividend stock. 1- Monthly Dividends As you can see in the picture Realty Income calls themselves “The Monthly Dividend Company” and they are known as just that. Realty Income has paid 646 consecutive monthly dividends! Dividend investors like monthly dividends more than quarterly dividends because they can compound faster which is amazing. Investors also like monthly dividends because they get paid more often.                                 2 - Dividend Growth Realty Income is a dividend aristocrat which means they’ve raised their dividends every year for at least the past 25 years. Since Reality Income went public in 1994...

You’ve probably seen people on the Internet, talking about how Blackrock and Vanguard control the world. It’s not just random people either, Vivek Ramaswamy former presidential candidate has said this too. This isn’t a new theory as people have been saying this for a while. The reason they’re saying this is because Blackrock and Vanguard combined manage about $17 TRILLION! That’s around half of the U.S’s debt and together they owned 21% of the S&P in 2021.  If you look at most stocks top holders Blackrock and Vanguard are normally at the top of the list. As an example look at Apple’s shareholders with voting power over 5% in 2023. Vanguard is the biggest and Blackrock is right behind it. This makes it seem that Vanguard and Blackrock really do control these companies.   So do Blackrock and Vanguard really control the world?  To put it very simply…. No they don’t.  You may have noticed in the first paragraph how I wrote they manage $17 trillion. That’s ...

There has been a massive influx of high yield dividend paying ETFs that have joined the market in the past couple of years. The problem is some of these ETF may have great dividend yields but keep on dropping in share price for a number of reasons. In this article I will specifically be talking about is TSLY which currently has a 94% dividend yield.  TSLY was created by Yieldmax on October 22, 2022 and its purpose is to produce a high dividend yield that pays out monthly. It currently pays a whopping 94.95% dividend yield! This means for every 100$ you invest it should (the dividend yield fluctuates so this isn't guaranteed as we'll discuss soon) pay you 94.95$ in dividends per year. The way it works is by buying call options and selling put options to mimic Tesla's price movement. They also sell covered calls and have short positions which have cash and U.S bonds as collateral for it if the strategy takes a wrong turn. All the money TSLY generates from the premiums on the ...

Why Dividend Investors Love SCHD   The Schwab U.S. Dividend Equity ETF (SCHD) has become a favorite among dividend investors, and for good reason. This ETF offers a great combination of features that specifically cater to a dividend investor’s strategy. In this article, we’ll explore three specific characteristics that make SCHD so attractive to dividend investors. 1-How SCHD Selects Dividend Stocks SCHD has some strict requirements for stocks to be in it’s portfolio. The first requirement is that the company is in the Dow Jones broad market index and has had to have been paying a dividend for at least 10 consecutive years. It then checks free cash flow to total debt, shareholders equity, and the five year dividend growth rate to determine which stocks make it into the portfolio. This means they search through 2,526 individual stocks and end up only choosing around 100 of those stocks to put into the portfolio. Below is a visual representation of the process. For those wondering ab...