This week I want to take a look at Wells Fargo (WFC), the fourth largest bank in the US. WFC is one of the core holdings in my IRA portfolio and I’m expecting the company to continue to increase dividends over the years to produce a nice income stream for retirement. WFC offers retail and commercial banking, insurance and investment services. As I write this, the company trades at a forward PE of 11.7, a slight premium to Citigroup, Bank of America, JP Morgan and Wachovia. The dividend yield is 3.2% with a payout ratio of 43% and WFC has a very good track record of raising the dividend.
Some key strengths: [more]
My inflation concerns stem from rising energy prices and the way the government figures understate inflation. As you probably know, in the early ‘70’s the government started placing emphasis on ‘core’ inflation, which does not include food and energy prices. They did that to smooth out the volatility of the numbers. Both numbers are reported, but the core number has more influence in monetary policy decisions. Maybe some kind of moving average would be a better approach, but what do I know, I’m an engineer, not an economist. Since most of us are not ‘core’ people (we actually buy food and energy), you’re well aware the food and energy costs are climbing. At some point, those rising costs are likely to start being reflected in the core inflation numbers. [more]
Just tossing out a couple of random thoughts to keep the blog active in case TMF decides to pass out the pencil charms any time soon. [more]
My blog got picked for Matt Koppenheffer’s Blog Buzz for the second consecutive week. Clearly I’m spending too much time on this. Many thanks to Matt and TMF for giving me a swollen head. [more]
Disclaimers: I have no stake in LEND other than CAPS and Forbes' stock picking game. And, there's plenty I don't know about crunching through a balance sheet. [more]
We got a nice pop in CSCO last week. I backed up the truck on the 25th at 25.50, then took a small piece off the table on Thursday - don't want to get too greedy. Still overweight CSCO though. I saw that my blog entry from last week got copied to the CSCO board on Yahoo - someone actually does read these things. [more]