Investing 102

[PDXFactory]

That is my basic take - just to keep an eye on it and see where it goes. I did end up buying another small block, and have cash in reserves for when it (hopefully) finally turns the corner! I'm a little surprised that it has continued to drop...but it is the selling season!

Thanks to Greg and all for the feedback!

[So Cal Camaro]

I just bought a few more shares of KMI, always try to add a few more shares when I like the company and it is below my original entry point. I'm in for the long haul and eventually they usually rise again. Only one I got killed on ever is Lehman Brothers, but made a killing on others in the big downturn.

[WSSix]

x2 Jose. I'm not overly concerned yet either but I'm not ignoring the situation.

This really is interesting to watch. Gas is below $2 here in Atlanta. Never thought I would see that again.

[SSLance]

My wife bought some KMI at $22.50... She's usually a good luck charm and I figured that would do the trick.

Strangely enough, I'm alright with my KMI and ETP being down 50% as well. I got caught in a similar situation in 2008-2009 with my high yield tax free muni bond funds. Their asset value got hammered because their insurers were tied to the mortgage defaults...when they really didn't have anything to do with the mortgage crisis at all.

Back then, I bailed from them at the bottom and went big into equities...and that paid off fantastically...but they were like 75% of my total portfolio. The two mentioned above are (or should say "were") just over 10% of my portfolio now.

I think (hope) this is just another case of Mr Market throwing out the baby with the bath water, mix in a little tax loss selling and bam...this is what you get.

[toy71camaro]

I'll be keeping an eye on this one. I've been considering KMI for a long time to get a stake in the Oil/NG systems. Now might be a good time to stake a small claim of it.

[SSLance]

There's the hammer...

Kinder Morgan whacks dividend by 75%
Dec 8 2015, 17:11 ET | About: Kinder Morgan, Inc. (KMI) | By: Carl Surran, SA

Kinder Morgan (NYSE:KMI) -7% AH after announcing a 75% cut in its 2016 quarterly dividend to $0.125/share ($0.50 annually) from the current $0.51, the company's first-ever dividend cut.

KMI says the move enables it to use a significant portion of its cash flow to fund the equity portion of its expansion capital requirements, eliminate any need to access the equity market for the foreseeable future, and maintain a solid investment grade credit rating."This is in the best long term interest of our shareholders,"

CEO Steven Kean tells WSJ. "It gives us the flexibility to fund our growth in other ways."The company will hold a guidance webcast tomorrow morning at 8:30 a.m.


It was already priced in, mostly anyway...I'm thinking the stock might just pick back up some steam now. Main complaint has been cash flow related, this stops that, right?

[GregWeld]

Well that's not the kind of news ANY dividend investor wants to hear -- and my guess is that the cut was well telegraphed to their largest shareholders -- thus precipitating the large volume of selling over the last 30 days.

I would not expect KMI to hold their dividend at this low level because their game plan has always been to share the cash flow with the shareholders. So we take our lumps - the shares are already hammered - and you wait for oil to come back. When the happens is anyones guess.

Now you know why there are "rules" about limiting investments to 5% or so of your portfolio !!! This is classic. If you only hold 5% - it's just not that big of a deal. If it's 50% of your portfolio it is!

[ironworks]

Originally Posted by SSLance

There's the hammer...

Kinder Morgan whacks dividend by 75%
Dec 8 2015, 17:11 ET | About: Kinder Morgan, Inc. (KMI) | By: Carl Surran, SA

Kinder Morgan (NYSE:KMI) -7% AH after announcing a 75% cut in its 2016 quarterly dividend to $0.125/share ($0.50 annually) from the current $0.51, the company's first-ever dividend cut.

KMI says the move enables it to use a significant portion of its cash flow to fund the equity portion of its expansion capital requirements, eliminate any need to access the equity market for the foreseeable future, and maintain a solid investment grade credit rating."This is in the best long term interest of our shareholders,"

CEO Steven Kean tells WSJ. "It gives us the flexibility to fund our growth in other ways."The company will hold a guidance webcast tomorrow morning at 8:30 a.m.


It was already priced in, mostly anyway...I'm thinking the stock might just pick back up some steam now. Main complaint has been cash flow related, this stops that, right?

I'm kinda confused how this is a good thing for dividend investing. I get how this is a good thing for Growth for the stock but does this change anyone's opinion?

I'm so far up side down in my shares there is no reason to quit now. But is now a good time to think about buying back my cost basis.

[GregWeld]

Originally Posted by ironworks

I'm kinda confused how this is a good thing for dividend investing. I get how this is a good thing for Growth for the stock but does this change anyone's opinion?

I'm so far up side down in my shares there is no reason to quit now. But is now a good time to think about buying back my cost basis.

No --- wait until we can see the light in this name. Otherwise it becomes gambling just based on "I own it so it will come back". We don't know that now. We can wait for a change of prices and we can ALWAYS buy more.

[GregWeld]

Originally Posted by ironworks

I'm kinda confused how this is a good thing for dividend investing. I get how this is a good thing for Growth for the stock but does this change anyone's opinion?

I'm so far up side down in my shares there is no reason to quit now. But is now a good time to think about buying back my cost basis.

Separate response for a separate question:



5 years ago (or so) all the banks cut, or quit completely, paying any dividend. GM went completely broke... Ford quit paying a dividend. This happens from time to time when you have a complete breakdown in something beyond normal control. In this case - we have a world using less of a commodity - and we have foreign countries determined to put the USA oil production out of business. We have no control - nor do the companies swept up in the debacle.

GM is doing fine - Ford is doing fine - Banks have recovered and are now paying dividends. My point is - wait - and things will change.