Drilling down a bit

Since I can't see much excitement on the horizon with new money to invest or great bargains popping up all over, perhaps it makes sense to look at some of the stocks I own with an eye towards asking what I like about them and what I know about them.

Starting with the A's....

I bought ABT a while ago, for the standard reasons; big pharma, lots of products I know and some I prescribe, long history of rising dividends, etc. Then they threw a curve ball;  Why they split is beyond me. Other companies are at least as, or more diversified. Look at JNJ; they have pharma, medical supplies, other stuff. Anyway, when ABT split to Abbvie and ABT, I felt I should choose, and stick with the DGI benchmarks I had set out. Abbvie had the higher dividend and the blockbuster drug. ABT has a bunch of stuff, but a lower dividend. I went with Abbvie, not knowing exactly whether it would produce a history conducive to a long term hold.
Well, in less than 2 years it's value has nearly doubled and the dividend remains near 3%, my prior buy threshold. I still don't have a clear sense of it's future, but the performance has been scintilating, and the dividend still hovers around my buy threshold. Until I see a reason to sell, I'll hold on. The dividend growth has a short history, but is adequate.

ADP...
a little history here. I used to be a part-owner of a small business...less than $2 million annual revenue. I became the managing partner, and boy did my eyes get opened!   Retirement plan rules and regulations, HR stuff, payroll issues; none of which I knew anything about. My manager suggested that we outsource payroll, and we went to Paychex. They did a great job at a very modest price, freeing up hours of my managers time. She had time to pay much more attention to accounts receivable. Our business improved. I bought Paychex. I also learned that Paychex and ADP were the big dogs in this market, focusing on different pieces of the business world. I liked the performance history of ADP and the dividend, so I bought it.
Now I'm a part owner in a large business; probably 100 million/year in revenues. I sit on the benefits committee; I see the health plan administration, the life and disibility insurance, the pension/profit sharing advisor relationship and etc. Our company does payroll for nearly 1000 persons.   Now I know what ADP is about. Payroll and benefits management for larger companies; more complex, more regulations, need for robust computer programs, lots of attention to detail. A bigger reason to consider outsourcing to reduce labor costs, leverage expertise, etc.

ADP has done very well for me... nearly 20% per year over 2.5 years, 2.3% dividend with 10% DG over those 2.5 years. There is a huge market and these two companies have barely penetrated it. I think the runway is pretty long going forward.

AWF... it's a fund, and a bond fund no less. This story is a piece of my newsletter history. It's about Neil George.  He's a quirky personality in the newsletter world. Used to work for one of the big independent research/newsletter/advisor groups, got dumped, opened his own shop, then disappeared for a while, then reappeared as the "Lifetime Income Report" editor with Agora Financial. 
I like reading his stuff.  He's all about secure income; "pay me now", so to speak.  He educated me about "minibonds" back in the days after the big meltdown of 2008 and I cleaned up on corporate minbonds at 50% on the dollar, big yields, rode them all the way to face value and sold them when there was little appreciation left.
He also recommended some emerging market bond funds. I still own 3 of the 4 he recommended and they have been very steady performers over 6 years. AWF is one of them. I dumped the Pimco product because of leverage; worried about this exposure if there is interest rate margin compression, but those without leverage are paying their 7% or thereabouts steadily. This one has returned about 150% over 6 years with reinvestment of distributions; it continues to clock along at 7% yield. The price fluctuates up and down a bit, but I'm DRIPing, so my cost basis stays down and i see no reason to step off a moving train.

AXPWD- don't ask me about this one...this is purely speculative, indulges my interest in alternative energy, and allows me to follow a very lively blog. I have taken a bath on it, but have intentionally limited my investment to 2% of the portfolio, so I can't get hurt too bad here. It has nothing to do with my conservative prudent DGI strategy, more a throwback to old undisciplined days...

that's the A's....more details next post.