Top pick Barrick Mining just raised its dividend a whopping 140% as it generates record earnings and continues its strategic asset reorganization.
Warner Music Group Corp. is well-positioned for higher-margin catalog revenues, added streaming adoption, and new AI monetization opportunities.
ARC Resources keeps returning its cash flow to shareholders through a growing dividend and substantial share buybacks.
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Decades ago, it used to make some sense to try to profit by moving back and forth between bonds and stocks. That’s because bonds and stocks had something of a seesaw relationship.
When the economy was strong, business profits and stock prices would go up. However, interest rates and inflation would go up as well. The rise in interest rates meant that new bonds would come on the market with higher interest rates. That would push down prices of existing bonds that carried low interest rates.
As this process continued, some investors would sell some of their stocks, in part because stock prices had gone up. They would re-invest the money in bonds, because bond prices had fallen, and bond yields had gone up. This trading strategy gave investors a sense of safety and accomplishment, but it had drawbacks.
For one, you had to pay taxes in gains on your stocks if you held them in taxable accounts. You also had to pay brokerage commissions on the stock sales, and absorb the costs of buying bonds. (Bond trading costs were often built in to the price of bonds, rather than being charged separately as they are with stocks.) In addition, timing was crucial.
The appeal of selling stocks that had gone up, and buying bonds that had become cheaper, only goes so far. It shrinks quickly if your stocks keep going up after you sell, and your bonds keep going down after you buy.
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When the economy was strong, business profits and stock prices would go up. However, interest rates and inflation would go up as well. The rise in interest rates meant that new bonds would come on the market with higher interest rates. That would push down prices of existing bonds that carried low interest rates.
As this process continued, some investors would sell some of their stocks, in part because stock prices had gone up. They would re-invest the money in bonds, because bond prices had fallen, and bond yields had gone up. This trading strategy gave investors a sense of safety and accomplishment, but it had drawbacks.
For one, you had to pay taxes in gains on your stocks if you held them in taxable accounts. You also had to pay brokerage commissions on the stock sales, and absorb the costs of buying bonds. (Bond trading costs were often built in to the price of bonds, rather than being charged separately as they are with stocks.) In addition, timing was crucial.
The appeal of selling stocks that had gone up, and buying bonds that had become cheaper, only goes so far. It shrinks quickly if your stocks keep going up after you sell, and your bonds keep going down after you buy.
...
A: Walt Disney Co., $112.34, symbol DIS on New York (Shares outstanding: 1.7 billion; Market cap: $180.8 billion; www.thewaltdisneycompany.com), is a family-focused entertainment and media firm. It’s also the world’s largest theme park operator.
It is among the world’s best-known brand names.
The company has five main business segments:
It is among the world’s best-known brand names.
The company has five main business segments:
- Media Networks (44% of revenue) includes ABC Television, ESPN, the Disney Channel, ABC Family and SOAPnet (a cable channel devoted to soap operas). Disney produces films and television programs under the ABC Studios, Buena Vista Productions and ABC Family Productions labels. It also holds interests in Lifetime Entertainment Services (a women’s cable channel) and A&E Television Networks.
- Parks and Resorts (31% of revenue) includes the Disney Cruise Line, 12 Disney Vacation Club resorts and Adventures by Disney (which plans guided international trips for families). Disney’s resort locations include Disneyland Resort in California, Walt Disney World Resort in Florida, Tokyo Disney Resort, Disneyland Resort Paris and Hong Kong Disneyland.
A: Avis Budget Group Inc., $33.58, symbol CAR on Nasdaq (Shares outstanding: 100.3 million; Market cap: $3.3 billion; www.avisbudgetgroup.com), rents cars and trucks under the Avis and Budget banners at more than 10,000 locations in 175 countries. It also owns Zipcar, a leading vehicle-sharing service with 950,000 members. In all, the company has roughly 540,000 vehicles in its fleet.
The Avis brand supplies 65% of total revenue, followed by Budget (30%) and Zipcar (5%). About 70% of Avis Budget’s revenue comes from rentals at airports.
In the three months ended September 30, 2015, the company ’s revenue rose 1.4%, to $2.58 billion from $2.54 billion a year earlier. Without the negative impact of the high U.S. dollar, which hurts the contribution from its foreign operations, revenue gained 8%.
The company’s total number of rental days (or the days a vehicle was rented) rose 9.6%. However, unfavourable exchange rates cut average revenue per day by 7.7%.
Earnings fell 1.4%, to $206 million from $209 million. Avis spent $161 million on share buybacks during the quarter. Due to fewer shares outstanding, per-share profits improved 3.7%, to $1.98 from $1.91.
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The Avis brand supplies 65% of total revenue, followed by Budget (30%) and Zipcar (5%). About 70% of Avis Budget’s revenue comes from rentals at airports.
In the three months ended September 30, 2015, the company ’s revenue rose 1.4%, to $2.58 billion from $2.54 billion a year earlier. Without the negative impact of the high U.S. dollar, which hurts the contribution from its foreign operations, revenue gained 8%.
The company’s total number of rental days (or the days a vehicle was rented) rose 9.6%. However, unfavourable exchange rates cut average revenue per day by 7.7%.
Earnings fell 1.4%, to $206 million from $209 million. Avis spent $161 million on share buybacks during the quarter. Due to fewer shares outstanding, per-share profits improved 3.7%, to $1.98 from $1.91.
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