Now Serving Humble Pie at Taco Bell
Kyle is a member of The Motley Fool Blog Network -- entries represent the personal opinion of the blogger and are not formally edited.
Progress Report: Phillip Morris (NYSE: PM), mentioned 1/16/12 at $76 per share, currently trading around $77 (intraday, 2/6/12). Not exactly smoking, I realize that.
Before you start thumbing your nose at me like some nameless imbecile, I want you to put down that glass of Haterade and take a deep breath. I am not a short-trader, a bear, a bull, nor am I any sort of hedger. I consider myself more of a wolf, stalking my stocks like prey and consuming them, digesting every last savory morsel. Yes, even wolves get heartburn, bad gas, sometimes a touch of food poisoning, it’s perfectly normal. And when I win with a stock I am truly happy, but I don’t perform a perfectly choreographed touchdown dance or chest-bump the CEO, busting open a piñata with the company’s logo while money falls into my welcoming arms. And neither should you.
Humility is a wonderful characteristic and I truly wish more people would make a serious effort to acquire some from their grocer’s freezer. It’s a great trait to be blessed with as you enter your investing efforts, because while you win some, you will also most assuredly lose some. So to keep from getting overly emotional with your holdings, a clear, level head is the best start for your trading endeavors.
Yum! Brands (NYSE: YUM), reports earnings soon and it is definitely getting a decent amount of play, due in large part to their exposure with China and India. Personally, the food disgusts me, but they have a decent business model even with KFC on their roster. If you have a spot with Yum, I want you to stay calm and not get all jittery if earnings don’t blow the doors off. If you are considering a position, I think it’s quite possible to get your start at lower levels after the earnings call. The 1.8% dividend yield is nice and I think the stock is worth a look for a long position.
None of my holdings are Yummy, as I am still walking up and down the street where Philip Morris International lives. I think it’s a better long-term play and they must eat at Taco Bell a lot, because their dividend yield is much more cherubic, at 4%. As for China and India exposure, I like cigarettes more than I like greasy fast food, but you could definitely do a lot worse than either one of these two companies. Sir Smokes Alot reports earnings Thursday, and I, for one will give it a listen, hoping for some mediocrity so I can start a long position below current trading levels.
I think both of these companies could offer a decent run this year, especially if folks start sweating hot sauce and sour cream and wheezing thanks to their tar-laden lungs during the jog. So if the earnings reports reveal that nobody is changing their eating habits, or quitting smoking anytime soon, put down the burrito, dispose of your cigarette butt in the nearest receptacle, and take a look at one or both of these “China plays”.
Motley Fool newsletter services recommend Philip Morris International and Yum! Brands. The Motley Fool owns shares of Philip Morris International and Yum! Brands. kmet312 has no positions in the stocks mentioned above. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.