How To Invest

Pat McKeough has been making investing for beginners simple—and profitable—by helping investors make big gains for more than 25 years. His advice to beginning investors is the same as it is for all investors: buy high-quality, mostly dividend paying stocks (or ETFs that hold these stocks) and evenly spread your investments over the five main economic sectors (Resources, Manufacturing, Finance, Utilities and Consumer). Pat also believes investors should avoid stocks in the broker/media limelight and focus on those with hidden or little-noticed assets.

In addition, Pat thinks then beginner investors should cultivate two important qualities: a healthy sense of skepticism and patience.

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Investors should approach all investments with a healthy sense of skepticism. This can help keep you out of fraudulent stocks that masquerade as high-quality stocks. It will also keep you out of legally operated, but poorly managed, companies that promise more than they can possibly deliver.

If you are a new investor, you should also realize that losing patience can cause you to sell your best choices right before a big rise. All too often, investors buy a promising stock just as it enters a period of price stagnation. Even the best-performing stocks run into these unpredictable phases from time to time. They move mainly sideways in a wide range for months or years before their next big rise begins. (Stock brokers often refer to these stocks as “dead money.”)

If you lack patience, you run a big risk of selling your best choices in the midst of one of these phases, prior to the next big move upward. If you lose patience and sell, you are particularly likely to do so in the low end of the trading range, when stock prices have weakened and confidence in the stock has waned.

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You Can See Our Spinoff Stock Portfolio For May 2023 here.

Why we like spinoffs so much
We think that spinoffs are the closest thing you can find to a sure thing for two main reasons:

1) The management of a parent company will only hand out shares in a subsidiary to its own investors if it’s all but certain that business, and the parent, will be better off after the spinoff.

2) Spinoffs involve a lot of work and legal fees....

1 min read

Pat McKeough

How To Invest

Here’s our Power Recommendations Portfolio for May 2023

You Can See Our Current Power Recommendations For May 2023 here.

Understanding our recommendations: Power Buy—These stocks are our top choices for new buying now....

1 min read

Pat McKeough

How To Invest

Q: Pat, would you please comment on the Vanguard Dividend Appreciation ETF (VIG)? Many thanks.

A: Vanguard Dividend Appreciation ETF, $156.07, symbol VIG on New York (Units outstanding: 425.0 million; Market cap: $66.3 billion; www.vanguard.com), aims to track the S&P U.S....

1 min read

Pat McKeough

How To Invest

Q: Please, may I have your recommendation on Church & Dwight going forward? Thanks.

A: Church & Dwight Co. Inc., $89.06, symbol CHD on New York (Shares outstanding: 244.0 million; Market cap: $22.0 billion; www.churchdwight.com), is a manufacturer of leading personal care, household, and specialty products.

Founded in 1846, the company is the leading U.S....

2 min read

Pat McKeough

How To Invest

Q: Can I get your take on MarineMax as a buy? Thank you for all your great advice over the years.

A: MarineMax Inc., $27.93, symbol HZO on New York (Shares outstanding: 21.9 million; Market cap: $615.4 million; www.marinemax.com), operates as a recreational boat and yacht retailer, and a services firm for yacht owners in the U.S.

The company sells new and used recreational boats, including pleasure and fishing boats, mega- and small yachts, sport cruisers, ski boats, jet boats, and other recreational boats.

It offers marine parts and accessories comprising marine electronics; dock and anchoring products that include boat fenders, lines, and anchors; boat covers; trailer parts; water sport accessories, which comprise tubes, lines, wakeboards, and skis; engine parts; steering and control systems; corrosion control products and service products; high-performance accessories, including propellers and instruments; and a line of boating accessories such as life jackets, inflatables, and water sports equipment.

MarineMax also provides novelty items, such as shirts, caps, and licence plates; marine engines and equipment; maintenance, repair, and slip and storage accommodation services; and boat or yacht brokerage services.

The company has more than 125 locations worldwide, including 78 dealerships and 57 marinas.

Its businesses include IGY Marinas, which operate luxury marinas in yachting and sport fishing destinations around the world; Fraser Yachts Group and Northrop & Johnson, two leading luxury yacht brokerage and services firms; Cruisers Yachts, one of the world’s premier manufacturers of premium sport yachts and motor yachts; and Intrepid Powerboats, a premier manufacturer of powerboats.

Meanwhile, MarineMax also offers financing and insurance services as well as digital technology products to connect boaters to a network of marinas, dealers, and marine professionals.

In addition, it operates MarineMax Vacations in Tortola, British Virgin Islands, which offers luxury boating adventures to vacationers.

MarineMax has also made 14 acquisitions since April 2019.

On January 5, 2023, the company announced completion of its latest deal: Boatzon is a retail technology platform dedicated to the marine industry....

3 min read

Pat McKeough

How To Invest

Q: Pat, could I get your recommendation on Stella-Jones? Thanks.

A: Stella-Jones Inc., $52.97, symbol SJ on Toronto (Shares outstanding: 59.5 million; Market cap: $3.1 billion; Manufacturing sector; TSINetwork Rating: Extra Risk; www.stella-jones.com), is a manufacturer of pressure-treated wood products....

2 min read

Pat McKeough

How To Invest

What is Pat’s commentary for the week of April 18, 2023

Last week in this space, I mentioned that beginning investors may develop an unrealistic idea of how much money they can make by delving into short-term stock trading. It seems obvious to them that all it takes is some good advice from an expert.

However, any true investing expert understands that random factors play a big role in short-term stock price fluctuations....

1 min read

Pat McKeough

How To Invest

Spinoffs & Takeovers Hotline – Friday, April 14, 2023

MIDDLEBY CORP., $139.01, symbol MIDD on Nasdaq, designs, manufactures, markets, distributes and services a broad line of (i) foodservice equipment for all types of commercial restaurants and institutional kitchens, (ii) food preparation, cooking, baking, chilling and packaging equipment for food-processing operations, and (iii) premium kitchen equipment, including ranges, ovens, refrigerators, ventilation, dishwashers and outdoor cooking equipment, primarily used in the residential market.

The company owns over 100 brands, including TurboChef, Follett, Star, Viking Range, AGA, and Armor Inox.

Founded in 1888 as a manufacturer of baking ovens, Middleby Marshall Oven Company was acquired in 1983 by TMC Industries Ltd., a publicly traded company that changed its name in 1985 to The Middleby Corporation.

In April 2021, Middleby announced a $4.3 billion takeover bid for Welbilt Inc....

11 min read

Pat McKeough

Testimonials

The cornerstones of Pat’s strategy–value, diversification and timelines–make his newsletter, The Successful Investor, highly profitable while minimizing risk. His advice is no-nonsense, down-to-earth and based on solid research. You’ll know what to invest in and what to avoid.

Chuck Chakrapani, PhD
Investors Association of Canada
The older I get the better dividends look. For retirees and would-be retirees who want to sleep at night, I can’t think of a better source of information on reliable growing dividend income than Pat McKeough’s newsletter, Dividend Advisor.

Jonathan Chevreau
Financial Post Columnist
As a manager of more than $500 million in mutual funds, I have access to the best brokerage research available in this country. But I still take time to read Pat McKeough’s premium newsletters

John Sartz
I appreciate the 25 years of above market returns I received by following your advice. at least 95% of my investment decisions were based on TSI recommendations.

Chuck J.
Subscriber since 1996. Inner Circle Member Since 2006
The newsletters I receive in Inner Circle Pro are fantastic! I have been following Pat’s advice for years and everything he has said has been amazing. His commentaries are brilliant, insightful, educational, rational and balanced. My returns are almost double the TSE and I have referred many of my friends who have switched over to your services.

Walter H.
Inner Circle Pro subscriber

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Spinoffs

One of the ways a company can try to unlock its own hidden value is by creating a separate company out of a corporate subsidiary. The parent company can either sell stock in the new company to the public, or spin it off—hand the stock out to its own investors.

Dividend Stocks

Dividend stocks make cash payouts that serve as a way for companies to share the wealth they’ve accumulated. These payouts are drawn from earnings and cash flow and paid to the shareholders of the company. Typically, these dividends are paid quarterly, although they may be paid annually or even monthly as well.

ETFs

What are ETFs?

ETF is an acronym for exchange traded fund. These exchange traded funds are used to track indexes as closely as possible, since investors cannot actually buy an index outright.

Value Stocks

What are value stocks?

One of the sweetest and most profitable pleasures of successful investing is to buy high-quality “value stocks” (or stocks that are reasonably priced, if not cheap, in relation to its sales, earnings or assets), then hold on to them as mainstream investors recognize the value and push up the share price.

Blue Chip Stocks

Blue chip stocks are big, well-established, dividend-paying corporations with strong business prospects. These are companies that also have sound management that should be able to make the right moves to keep competing successfully in a changing marketplace.

Penny Stocks

A penny stock in general trades for under five dollars a share, and as the name implies, sometimes for pennies. Most of the time they’re young companies, or start-ups in speculative markets like mining or technology.

Growth Stocks

Growth stocks are companies that are likely to have sales and earnings growth well above market average. Frequently they pay few, if any, dividends. Instead they typically reinvest any extra cash flow to promote further growth. Chosen wisely—according to Pat McKeough’s advice—high-quality growth-oriented stocks can be worthwhile additions to most well-diversified portfolios.

Wealth Management

Wealth management is the practice of putting your savings to work so that it continues to grow over your lifetime and will also benefit your heirs. Wealth management encompasses many different areas of investing like long term investment planning and retirement planning.

Mining Stocks

Mining stocks are investments in companies that produce or explore for minerals. Some of these minerals include uranium, coal, molybdenum (which is used in steelmaking), copper, silver and gold. They are affected by fluctuating commodity prices in addition to their own business and operating risks.

How To Invest

Energy Stocks

What are energy stocks?

Businesses that work in the extraction, refining and delivery of energy sources such as natural gas, oil, uranium and coal, are considered energy stocks.