Question:
I purchased some Microsoft within the past year, and the stock is off a bit. I view it as a long-term hold. What are your thoughts on the long term for Microsoft?
Answer:
Microsoft Corp. (NASDAQ: MSFT) is not a growth company like Apple, Inc. (NASDAQ: AAPL). It is a mature growth company, which means it is very stable. According to Value Line, Microsoft is expected to grow sales by 11% a year. The company has a very strong cash flow. We feel Microsoft is a conservative investor’s dream. The company should enhance shareholder value by paying dividends and buying back stock. We feel it is a company that should get you 12%-14% a year consistently. We own Microsoft and recommend buying it.
Question:
I own Sherwin-Williams, and once asked your opinion on it (a few years ago). At that time, it did not meet your criteria for holding in your portfolio, but you seemed to think it was a pretty good stock. About eight months ago, SHW started climbing to mid 90s, and I thought it might be becoming overpriced, and I sold some of my shares. The stock continued to rise and rise and is now at $150 or so. I would have a hard time buying at this price, but wonder if I should hold or sell my remaining shares.
Answer:
Sherwin-Williams Company (NYSE: SHW), in our opinion, is a very well-run company. You are correct in your thoughts that it is over priced, as it trades at 24 times earnings. However the company knows how to operate. Despite the competition from big-box retailers, Sherwin-Williams operates more than 3,300 specialty paint stores across the United States, Canada, Puerto Rico, and some of the Caribbean islands.
If you own shares, we recommend holding, as the company is in the cyclical sweet spot for a housing recovery.
Question:
I own Consolidated Edison, and I think it took a beating with Hurricane Sandy. What do you think—was it just a byproduct of the storm craze or have they managed something wrong? Any red flags I should be watching?
Answer:
We have owned Consolidated Edison (NYSE: ED) in our income portfolios, and in our opinion, this is a rock-solid company. Investors, generally, own Consolidated Edison for its dividend, which is covered three or four times by its cash flow. This company is also expected to boost its dividend in 2013. Currently, it pays $2.44 per share. We feel this is an excellent holding as an income investment.
At Henssler Financial we believe you should Live Ready, which includes understanding the stocks you own. If you have questions regarding your investments, the experts at Henssler Financial will be glad to help. You may call us at 770-429-9166 or email at experts@henssler.com.
Disclosures
This article is meant to provide valuable background information on particular investments, NOT a recommendation to buy. The investments referenced within this article may currently be traded by Henssler Financial. All material presented is compiled from sources believed to be reliable and current, but accuracy cannot be guaranteed. The contents are intended for general information purposes only. Information provided should not be the sole basis in making any decisions and is not intended to replace the advice of a qualified professional, such as a tax consultant, insurance adviser or attorney. Although this material is designed to provide accurate and authoritative information with respect to the subject matter, it may not apply in all situations. Readers are urged to consult with their adviser concerning specific situations and questions. This is not to be construed as an offer to buy or sell any financial instruments. It is not our intention to state, indicate or imply in any manner that current or past results are indicative of future profitability or expectations. As with all investments, there are associated inherent risks. Please obtain and review all financial material carefully before investing. Henssler is not licensed to offer or sell insurance products, and this overview is not to be construed as an offer to purchase any insurance products.
