iDan_TZ

People ask me why not save money and open a business? 'Hey, why not open a hot dog stand?". Well, although I enjoy eating hot dogs, I don't know if I'd like standing in one spot for 9 hours at a time serving them up. Although opening a hot dog stand is a very simplified version of the question, it is valid. Why not open a business instead of investing in dividend growth stocks? Why stocks in general? Let's examine that question.1) Dividend investing is just a fancy name for becoming a part-owner of a dividend paying company. Why dividends? Dividends are simply put the litmus test for a company's health and well-being. And if one looks into historical records, he can see that over the last hundred years, dividends make up almost the 50% of total return in the stock market.2) Investing in a…

v After Visa announced the Q1’14 results, shares fell to $200. In my opinion it is a reflection of misunderstanding of the results, which also ignores the quality of company’s balance sheet as well as the the growth prospects. v Visa has grown net operating revenues in Q1 by 11% YoY, thanks due to robust growth of service revenues, data processing revenues and international transaction revenues. v During the quarter the company has repurchased 5.5mln shares at an average price $199.56 using $1.1bln of cash at hand. v The company has not debt, no pension obligations or even no preferred stock. v Free cash flow for the company at the end of Q1 was $1.6bln, while capital expenditures were $250mln in total (!). v In 2008, there were 1.4bln shares outstanding, while at the end of Q1, shares ou…