Dividends4Life: My Bottom 5 Stocks

My Bottom 5 Stocks

Posted by D4L | Thursday, August 21, 2008 | | 5 comments »

Earlier this week we looked at my top 5 high fliers for 2008. Unfortunately, for every up, there is a down and that is certainly true for my portfolio. As before, we will look at results through July 31, 2008. Here they are my cellar dwellers with comments:

#5 - General Electric (GE) -19.3% Total 2008 Return
Of my cellar dwellers, GE is the one I am most bullish on. I liked it at $38 when I bought my first tranche in July/2007, and liked it even more at $29 when I bought my last tranche this month.

#4 - First Industrial Realty, Inc. (FR) -22.3% Total 2008 Return
This was my first ever dividend investment. It was purchased in December/2003. FR has consistently raised it's dividend since then; and unfortunately, its share price has consistently fell since then. FR has more lives than a cat - each time I give it up for dead, FR raises its dividend.

#3 - SunTrust Banks, Inc. (STI) -31.8% Total 2008 Return
Until recently, STI wore the cellar dweller crown. It very well could be the next bank divested, if it cuts its dividend.

#2 - American Capital Strategies, Ltd. (ACAS) -31.9% Total 2008 Return
ACAS has long been one of my favorite stocks. I have been in and out of it since February/2004 and still have a positive 2.2% life-to-date annualized return. ACAS continues to raise its dividend, but at some point it operating results will have to turn around.

#1 - iStar Financial Inc. (SFI) -63.8% Total 2008 Return
SFI is on a breathing machine and short of an immaculate recovery it likely will not make it to the end of the year. It's 14.6% yield on cost will be missed, while its double-digit share price collapse will not.

I take solace that even with these poor performers, I am still ahead of the S&P 500 for the year. In dividend investing, you can't focus too much on the good or bad. You learn from each and keep your eye on the long-term.

Disclosure: Long in GE, FR, STI, ACAS and SFI.

(Photo: Steve Woods)

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5 comments

  1. Nurseb911 // August 21, 2008 at 7:40 AM

    I certainly share your pain with being a shareholder of GE. I'm also long the stock, so with a 20+ year investing horizon I'm positive that it'll turn out to be a sound investment for the long-term despite the short-term.

  2. Anonymous // August 21, 2008 at 8:50 AM

    I also feel your pain on ACAS and GE. I am there also for the long run however.

  3. MG (moneygardener) // August 21, 2008 at 9:36 AM

    I see a similar theme here = financials. I like GE as well at these levels. 100% safe yield over 4 points...

  4. Anonymous // August 21, 2008 at 2:26 PM

    Thanks for sharing the bottom performers as well.

  5. Anonymous // August 21, 2008 at 7:54 PM

    Brad & DGI: It is great to have a lon-term perspective!

    MG: Speaking of financials, I was surprised that BAC didn't make the bottom 5.

    Jae Jun: I try to keep it balanced.

    Best Wishes,
    D4L

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