I just executed a limit order for 8 shares of Altria (MO) at $34.15.
MO closed up at $34.24 yesterday. The same day the DOW Jones closed at
14,253.77. This is the DOW Jones' new all-time high.
Therefore, I anticipated some profit taking so I predicted that MO would at
least go down to $34.15 maybe even lower. My gambit paid off and my limit order
was completed earlier today. I could have gone lower since MO went as low as
$34.01 but I think my conservative bet was good enough. I just want to almost
guarantee that I would get those 8 shares of MO. The main reason why is because
we're approaching MO's Ex-Dividend date of March 13, 2013. The next valid
Automatic Investment Plan date is on Tuesday, March 12, 2013. That is cutting
it close since I have to buy the shares a day before the Ex-Dividend date in order
to qualify for the dividend pay out. I decided to execute it early just to make
sure plus the trading fees are now $6.95 (down from $9.95) so the $3 difference
would be paid for by the dividends.
So why Altria (MO)? First, the dividend pay day is coming. Second, MO's
dividend pay outs increased from $0.41/share in July 2012 to $0.44/share from October 2012.
I love stocks of companies who increase their dividend payments because it tells
me their earnings are doing well (after reviewing their financials of course) and they want to reward their investors with more cash.
Finally, I am counting on Altria's growth prospects as the global economy
improves. As the global economy improves, MO's customers would be more willing
to spend money to buy MO's E-Cigarettes, high-end cigars and wine products.
Even if MO's regular customers do not feel the improvement, they'll still continue buying
Marlboro cigarettes (and other MO brands). If there's one thing I've learned from my
siblings (and Mad Men), cigarette smokers have brand loyalty.
So that's pretty much my Altria thesis. I'll buy more shares in the future
and as long as smokers smoke, I'm bullish on Altria's growth prospects.
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