Long Term Dividend Growth

  • Posted: 19 April 2012 06:57 PM #91

    Phoebear611 - 19 April 2012 09:45 PM
    alice - 19 April 2012 09:38 PM

    I can live well with dividend of $54 a year but not $21.32 a year.

    I don’t mean to be a snob but after taxes - how can you live on that in a full year???

    I live on less currently.

    [ Edited: 19 April 2012 07:03 PM by alice ]      
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    Posted: 19 April 2012 07:50 PM #92

    +1 on Alice’s comment. There is a lot to like about living small.

    However, AAPL, will be very good in the near term of sharing the largesse of their ( neigh, mine ) coffers.

    Tim knows that there is no chance in hell of spending the cash they are bringing in quarterly, short of a buyout of Samsung for cash.

    I fully expect each QTR to increase in yield, maybe by upwards of 5 Percent per QTR. I won’t be surprised to see 15-18 bucks a share in Q3 2013.

    I map 2013 Q4 at about 3.1 percent, at whatever price we are at then. Assuming a reasonably conservative increase in AAPL share price of 20 percent, and we trade at 700.00 by then, I look to see north of 22.00 per share.

    Depending on your holdings, more than enough to live on. Let’s just hope the lib’s don’t take it all away from us. This is a very real possibility, as the country is flat out broke, and will rely on myself coming to their rescue… 15% capital gain tax is soon to be the dodo bird.

    The real question is the off shore accounts, and besides assuring long term supplier agreements and cap ex spending, remains the 800 pound gorilla in the room.

    [ Edited: 19 April 2012 08:24 PM by MacManus ]

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  • Posted: 19 April 2012 08:11 PM #93

    alice - 19 April 2012 09:57 PM
    Phoebear611 - 19 April 2012 09:45 PM
    alice - 19 April 2012 09:38 PM

    I can live well with dividend of $54 a year but not $21.32 a year.

    I don’t mean to be a snob but after taxes - how can you live on that in a full year???

    I live on less currently.

    God bless! Because after taxes and basic utilities/rent/food/medical insurance/cable/cell phone etc and other basics ...there isn’t much left…although I am comparing everything to NYC prices so maybe that’s why I’m off…I hope.

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    Posted: 19 April 2012 08:20 PM #94

    The ability to live off AAPL dividends is directly proportionate to the number of shares you own, but if you decide to live in NYC, all bets are off…

    I am of the sponge theory, buy some yesterday, today and tomorrow, it will more than make up for what I will not get from SSI.

    2 pennies

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  • Posted: 19 April 2012 08:26 PM #95

    MacManus - 19 April 2012 11:20 PM

    The ability to live off AAPL dividends is directly proportionate to the number of shares you own, but if you decide to live in NYC, all bets are off…

    I am of the sponge theory, buy some yesterday, today and tomorrow, it will more than make up for what I will not get from SSI.

    2 pennies

    The assumption we were on was $54k “pre-tax”—which is really tough in new york city unless you are living with your parents or this is just disposable income or you have several roommates or something along those lines.

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    Posted: 19 April 2012 08:36 PM #96

    Phoebear,

    That is indeed low income for your neck of the woods, you might want to consider Belize or Little Rock, Ak.

    That would be very hard here in the windy city indeed.

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    Posted: 20 April 2012 12:00 AM #97

    Ok this topic has turned into taxes and cost of living.

    I would like to here serious predictions on how much growth in dividend should we expect.

    This is a very important question that must be answered by those who would buy the stock based a dividend.

    Mace feels that an 15% increase is the expected amount.

    Others think 20% a year.  I want to research and see what the IBM’s and MSFT of the world have done in the last 10 years.

    Obviously the increase has to correspond with amount of cash accumulation and cash expenses beyong regular operations.  Those factors have to change as the company slows down in growth or decides to use cash for other purposes.

    if the stock prices moves up and the dividend does not, then would the stock holders be happier with that instead of an increase in dividends?  If you don’t plan on selling for 30 years then paper profits are worthless without a dividend to justifying holding.

    If capital gains tax is removed then I think we should expect the stock market to correct by at least 40% in my view.  So I don’t see that as a real threat by the way.

         
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    Posted: 20 April 2012 12:20 AM #98

    Ok

    Here is my research when looking at IBM

    In 1996 IBM started to increase its dividend for the first time in a number of years after seeing go down for a few years as well.

    It started with .0625 per share.  By today that has increased to .75 a share.

    However we have had two splits since then so that .0625 is really worth $3 to those who have 4x more shares then those who bought today.

    Folks that is an increase of 480% in 16 years during mediocre growth for IBM.

    Going back to my earlier question about what the dividend would be at $3000.  If we conservatively use 1.8% then we get 54 or an increase of 500%.

    So far it looks like I will get rich just based on dividends in about 5 years. :-D

         
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    Posted: 20 April 2012 01:21 AM #99

    Is everyone in options here and don’t care about a dividend?

         
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    Posted: 20 April 2012 01:49 AM #100

    omacvi - 20 April 2012 04:21 AM

    Is everyone in options here and don’t care about a dividend?

    Nope. I look forward to the divvy. I exercised some options a couple of weeks ago to get the shares in place for taking the dividend.  I have some other deep ITM calls I will probably exercise later this year to build up a cash flow strategy whereby I will buy calls with the dividend and repeat the exercise over the next five years until I get to your target price of $3000.

    Then I will stop.

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  • Posted: 20 April 2012 02:16 AM #101

    I totally care about the dividend. Have been long since 2000. My family and I will make good use of the first dividend in July and look forward to it going up over the years. This topic has a lot of interest for me. Thanks Sponge!

         
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    Posted: 20 April 2012 02:18 AM #102

    Why wouldn’t Apple just raise the dividend in direct proportion to earnings growth?

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    Posted: 20 April 2012 02:32 AM #103

    Apple II+ - 20 April 2012 05:18 AM

    Why wouldn’t Apple just raise the dividend in direct proportion to earnings growth?

    So that means it could increase over 60% a year.  In five years we get well over $111 a share.

    I like that plan better then my conservative 500% gain.smile

         
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    Posted: 20 April 2012 02:57 AM #104

    omacvi - 20 April 2012 05:32 AM
    Apple II+ - 20 April 2012 05:18 AM

    Why wouldn’t Apple just raise the dividend in direct proportion to earnings growth?

    So that means it could increase over 60% a year.  In five years we get well over $111 a share.

    I like that plan better then my conservative 500% gain.smile

    But I’m probably wrong. I have no experience with how companies go about raising dividends.

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    Posted: 20 April 2012 04:17 AM #105

    omacvi - 20 April 2012 03:20 AM

    ... However we have had two splits since then so that .0625 is really worth $3 to those who have 4x more shares then those who bought today.

    Folks that is an increase of 480% in 16 years during mediocre growth for IBM.

    3/0.0625 = 48.  27% growth per year.  If similar, dividend would be $35.02 in five years.

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