November Budget 2012

 

Hey guys, no time to chat but here's the same budget that I had last month which seemed to be manageable.

I'm swarmed with school/work and going to be stuck hitting the books for at least the next 2 weeks so posts may be sparse. Education first right?

-the Paperboy

CRTC Strikes Down BCE-Astral Deal

 

In a move that nobody saw coming, the Canadian Radio-television Telecommunications Commission rejected BCE's bid for Astral media, stating that BCE would be too large and control to much of the market. What does this mean for shareholders of either company (I happen to have shares in both companies)?

Bell is obligated to pay a $150 million break fee if the deal falls through; which will happen unless BCE tries to appeal the decision. This comes out to about $3 per share is Astral.

Astral media will probably take a hit in market price since BCE may not be buying all the shares for $50 a pop anymore. However, it is believed that Astral will continue to look for a suitor because it's speculated that Ian Greenberg, the CEO plans to retire and he has no known successor. Since everybody still thinks that Astral intends to sell, that may keep the market price afloat. The only issue here is that the list of potential buyers is significantly shorter; larger companies like Rogers would run into the same competition issues as BCE did. Cogeco has been the name that I've seen thrown around as a potential suitor. If worse comes to worse and there's no buyers, then it is believed that Astral will just sell off its assets piece by piece.

So what does this mean or me personally? Back when the deal was announced, my profits jumped. I decided to hold on to the shares until the deal was sealed so that I could get the premium. When the deal was showing signs of faltering I decided to keep holding Astral stock because I honestly thought that the worst thing that could have happened was that the CRTC approved the deal but with changes; not outright kill it.

As of writing, Astral just took a 15% nosedive. This triggered my stop limit and I sold out for a mere 3% gain (not including dividends accumulated for holding the stock for well over a year). Astral still has solid fundamentals but with a takeover looking slim, I think the price will sink for the time being. When it gets even more depressed, I would not hesitate to jump back in at a lower price point.

- the Paperboy

Recent Market Plays October 2012

Hey guys, remember back in April when I said that I would be using some money to "play the market" as opposed to sticking to the tried and true dividend approach? Well Kinross soared for a couple days in early October so I took the chance to finally get out of that. It took me 6 months but I netted a 6.67% (including two dividend distributions) return so it didn't turn out too badly for me. I'm going to continue on with the experiment and maybe try and jump back into Kinross later because it seems to be dropping again. Or I could go into something else such as Silver Wheaton; we'll see how cheap the precious metals can get. Due to me closing my position with Kinross, expect my overall dividend yield to increase since Kinross paid a pittance in terms of dividends, however, the expected dividends received will be lowered as well.

To offset that, I grabbed some more shares of Reitmans. The clothing company is having a bit of trouble right now but the majority of retailers are having problems getting stuff off the shelves. The company is sitting on a lot of cash so it'll be able to pay off upcoming debt and hopefully be able survive to see better days in the economy. Awhile back, it teamed up with Toys 'R Us to have the toy store carry its clothes for expecting mothers. This shows that the company is trying to get an edge wherever it can. While the price is a little depressed, I'm able to get a higher yield and get more shares via my DRIP. This also gets me closer to that goal of $2200 in expected dividends.

October far from over and I recently stumbled onto some funds. Hopefully I'll be able to grab some more stocks and continue to build my portfolio. If not, I'll throw everything into my bond ETF and wait until the prices are acceptable. All part of the plan right?

-the Paperboy

Dividend Progress Report: September 2012 Edition

Total yield of portfolio - 4.49% (- 0.03%)
Actual dividends received - $1025.61 (+ $79.26)
Expected dividends return if the current positions are held for 1 year -  $1716.87 (+ $34.40)
Average dividends received per month: $113.96 (- $4.33)

After the recent purchase in my portfolio, the expected dividends return if the current positions are held for 1 year advanced into the $1700 territory. In terms of dividends received, September was the second worse month after the horrible June I had. This brings down the average dividends I get per month to almost $114 which still isn't bad for just sitting around and not doing anything; when you're a poor university student every little bit counts and $114 is more than what I would earn for a full day's work. So if I look at it that way, my portfolio essentially worked 1 day for me every month which is nothing to complain about... let's just try to make it work overtime for the rest of the year!

-the Paperboy