from Outsider Club:
There are things I want to buy.
Not newfangled gadgets and gizmos — neither the products themselves nor the companies behind them.
Not pie-in-the-sky stuff, either. While it’s no secret I love a good speculation, that speculation has to have merit, it has to have solid backing, and it needs to be run by accomplished management with skin in the game.
No, the things I want to buy have been around for a while. They’re involved in industries that make the world go round. They pay a dividend. They may even be boring. Boring enough that you could buy them and forget about them.
I want to buy Canadian Natural Resources (NYSE: CNQ). What does Canada have more of than natural resources?
In this case, a $27 billion behemoth that controls many billions of barrels of oil and several trillion cubic feet of natural gas and has lost 41% of its value over the last year because of the downturn in oil.
It’s not a hot-shot fracker. It doesn’t have a new drilling technology. It’s simply a stalwart in the biggest industry on Earth and it pays a 2.9% dividend at a time when the entire industry is reeling.
I want to buy Dover Corp. (NYSE: DOV), the $9 billion outfit with hands in industries as boring as ball bearings and pumps and lifts and energy efficient refrigeration and microwave filters and component switches for aerospace applications. I want to buy it because it’s trading at $61, down from $83 a year ago because it’s tangentially related to the energy space — yet it still beat earnings this week and is yielding almost 3%.
I want to buy TIM Participações (NYSE: TSU) because the story in Brazil couldn’t get any more negative right now, yet it remains a solid foundation in the BRIC nations with huge populations. And like everyone else, they need phone and data and Internet plans. The $5 billion TIM provides all that and more, including online banking and insurance, to over 75 million clients. It’s lost two-thirds of its value as the entire country is seemingly caught up in scandals. But it won’t be that way forever, which is how long you can hold stocks like these.
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