Indeed @jase, today's MLA is MASSIVE, the MLA has been published by numerous social media including Nasdaq.com, and it does take time for brokers/new investors to digest this significance MLA. * It is P&G, the world’s largest consumer goods company, that has put OBJ in the spotlight
*"Coconut has been cracked” there is no stopping the small Perth company’s global rise
*OBJ is now ready to tell its story
*P&G stock is up 12 percent since Taylor took the helm on Nov. 1 and the company is expected to report a $10 billion annual profit before one-time items on Tuesday when it will disclose results of its fiscal year that ended June 30.
Part of the reason dividend payers as a group produce better and more steady returns is because the dividend forces management to be more disciplined. If a company has several investment opportunities -- either acquisitions or internal developments -- the obligation of paying out a dividend every quarter will force management to only choose the opportunities with the highest expected rate of return. A growth company, looking to grow its revenue at all costs, may be apt to make every investment at its disposal in hopes that one may outperform its expectations. That means taking on more risk, and taking on more investments with lower potential returns.
What's more, if a company has a long track record of dividend growth, that discipline becomes even stronger. Procter & Gamble (NYSE: PG) , for example, has raised its dividend for 60 straight years and has a spot near the top of the Dividend Aristocrats. That kind of streak instills discipline in management to continue raising the dividend, because while it takes 60 years to build a streak like that, it only takes one year to break it.
* Shareholder friendly
While shareholders technically own a company, they don't control it. Management is in charge of calling the shots, including how much of the profits get returned to shareholders. Unless your name is Carl Icahn, you can't just buy some shares and start demanding that Apple (NASDAQ: AAPL) start buying back more shares and paying a higher dividend.
When management decides to pay a dividend of its own accord, it's showing a direct interest in returning value to its shareholders.
Additionally, steady dividend payers attract a different group of investors. Fewer people are short selling shares of P&G or Verizon because the dividend and its likely growth provides intrinsic value to the company's stock. Both of those companies have short interest that less than 1% of the company's shares outstanding, while a company like Twitter has over 8% short interest.
On top of that, investors in growth stocks are more likely to treat their shares like a race ticket rather than holding onto them for the long run, producing additional volatility in the share price. That's evidenced in the Siegel study mentioned earlier.
GLTA OBJers
OBJ Price at posting:
9.9¢ Sentiment: Buy Disclosure: Held
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