- It is Time to Buy Beaten Down Healthcare Stocks
(September 29, 2015)
- How To Make A Double Trading 3xleveraged Gold Miner ETF In A Week
(September 4, 2015)
- Market Bounced. What is the Next? (August 30,2015)
- Has the Market Entered its Bear Phase? (August 23,2015)
- Signs of Market Weakness (July 12, 2015)
- JNUG - Doubled In Three Weeks (April 22, 2015)
- Gold via Fed Fund Interest Rate
- An Historical Prospect (March 8, 2015
- Crude Oil - Don't Be Too Optimistic (February 16, 2015)
- Gold - It May Have Topped (January 22, 2015)
- Our View On Coming Market Direction
(August 10, 14)
- In Search of the Next Multi-Baggers
(August 01, 14)
- Market Has Topped. Prepare for Market Correction
(September 22, 13)
- GLD - The Last Drop. Bought NUGT
(June 26, 13)
- GLD - Bottom Is In But Do Not Chase It
(June 02, 13)
- ReneSola Earnings Preview: What to Look For
(May 12, 13)
- Good Year for Our Short Term Play
(April 14, 13)
- The US Stock Market Will See New Highs in 2013
(January 02, 13)
- 10 Stocks That Could Be Doubled In Value During January Rally
(December 16, 12)
- Monthly Market Review And January Rally
(December 02, 12)
- Top 20 Gainers For The Week Of September 17 - 21, 2012
(September 17, 12)
- The Market - Will We See A Repeat Of 2008 Crash?
(June 26, 12)
- 2012 Will Be a Very Good Year for the US Stock Market
(January 02, 12)
- The Market Will Keep the Momentum in 2011
(January 15, 11)
- The Market Will Have a Good Run Over the Next Two Months
(August 22, 10)
- RAIT Financial Trust - Revisited
(August 14, 10)
- KKR Financial Holdings: A Value Investment Pick
(August 06, 10)
- Are We Going into Another Depression?
(July 05, 10)
- Why RAIT Financial Trust Looks Like a Comfy Investment
(Apr 23, 10)
- CELM - Not All Chinese ADRs Are the Same
(Apr 22, 10)
- Super Star Pick of the Day - PMI
(Mar 31, 10)
- Gold Prices for the Year of 2010 Revisited
(Mar 23, 10)
- The Near Term Outlook for Major Solar Stocks
(Mar 17, 10)
- Value Investing for Your Retirement - Next Pick
(Feb 20, 10)
- The Near Term Trend for Chinese Solar Stocks
(Feb 11, 10)
- Where Will Gold Price be Heading for 2010
(Feb 06, 10)
- Value Investing for Your Retirement - KFN
(Jan 05, 10)
- Super Star Pick of the Day - SANM
(Dec 07, 09)
- Will October's Market Minic September's Comeback?
(Oct 02, 09)
- Sinovac Biotech: Still Worth Owning?
(Sep 21, 09)
- Super Star Pick of the Day - KFN
(Aug 31, 09)
- Super Star Pick of the Day - GCI
(Aug 27, 09)
- Super Star Pick of the Day - RTK
(Aug 19, 09)
- Super Star Pick of the Day - AIG (Aug 08, 09)
- Super Star Pick of the Day - MNI
(Aug 03, 09)
- Market Trend and Our Strategy to Pick Our Next Big Winners
(Jul 25, 09)
- Buying on Fear (Jul 07, 09)
- Hot Stock of the Day - FITB (May 11, 09)
- Hot Stock of the day - BAC
(May 09, 09)
- Hot Stock of the Day - BRCD (May 08, 09)
- Hot Stock of the Day - ASH (May 07, 09)
- Value Investing for Your Retirement - MTL (Feb 01, 09)
- Value Investing for Your Retirement - BK (Jan 17, 09)
- Don't Fall on the Trap of Short ETFs
(Jan 03, 09)
- How Long Will This US Stock Bear Market Last?
(Oct 13, 08)
- Once in a Century Financial Crisis Once in a
Lifetime Investment Opportunity
(Sep 26, 08)
- Buy Open Gap Down at Support
(Aug 26, 08)
Value Investing Series
KKR Financial Holdings: A Value Investment Pick
August 6, 2010
If you want me to name one stock which is worth for long term investment (buy-and-hold), it has to be KKR Financial Holdings (KFN).
KFN just announced its latest earnings. The company earned $0.51/per share in its latest quarter and earned $1.33/per share for the first half this year.
More importantly, the company raised its quarterly dividend by another 20%: from $0.10 to $0.12.
The following is its dividend history after it resumed its dividend since Q4, 2009:
- Q4, 2009 - $0.05
- Q1, 2010 - $0.07
- Q2, 2010 - $0.10
- Q3, 2010 - $0.12 (expect to deliever this month).
We bought this stock July 30, 2009 at a price of $1.79 and have reduced our cost basis to $1.57 now, using our dividend-reinvestment-plan and will reduce it further to $1.45 if the coming quarterly dividend is to be re-invested.
Now the company's dividend equals to $0.48/year. Let us assume that the company's dividend keeps unchanged for the next two years. That means, our cost basis will be reduced to $0.49 two years from now if we keep implementing our dividend reinvestment plan.
What does that mean? That means our initial investment will allow us to collect a 100% annual dividend after three years of our buy.
That is, we buy-and-hold this stock without any trade during the three year span, our initial $100k investment will distribute at least $100k annual dividend to us (it will be tax free if the money is invested in Roth IRA account). The stock will be traded at least $10.00 then (it is now an $8.50 stock).
Don't forget that the company's annual dividends were well above $1.00 before the current recession:
- 2005 $0.32 (The company did IPO in Q4, 2005 with IPO price of $25)
- 2006 $1.86
- 2007 $2.16
- 2008 $1.80
- 2009 $0.07
- 2010 $0.29 (up to Q3)
- 2011 ?
- 2012 ?
If the company can increase its annual dividend to $1.00 level in two years, our initial $100k investment will give us more than $200k annual dividend.
That is the true investment we have been looking for.
No daily market analysis, no frequent tradings.