Monday, June 20, 2011

Molex, symbol MOLX Dividend Machine June 20, 2011

Molex, symbol MOLX is a company that income investors have probably never heard of but MOLX is my dividend machine profile for June 20, 2011. 

Income investors have to love this stock market environment because when prices are soft we have more buying options.  Yet I cannot say I find many bargains. You and I know we still have to invest in income producing equities since certificates of deposit pay nothing and bonds pay almost nothing. 

We are troubled; conflicted perhaps because we know some of our expenses have increased.  Local taxes and service fees like homeowners association costs have increased.  Yet some other costs like clothing and even some property taxes are less than 2009.  Do we have inflation?   Do we have deflation? Is another recession on the horizon?  Who knows?  Therefore, we invest in those companies whose business is growing; a company well enough managed to have a solid balance sheet; and one that pays at least a three percent dividend yield.  A three percent yield is only acceptable if the company has increased that yield every year for at least five years; MOLX has increased the dividend for at least five years.

Molex, symbol MOLX makes electronic components. Do you use any electronics? MOLX has 39 manufacturing locations in 16 countries. MOLX will pay a $.20 quarterly dividend on July 25, 2011 if you own it by June 28, 2011.  On Friday, June 17, 2011, MOLX closed at $24.95 with a yield of 3.21%.  Debt to equity is a paltry .14.  Earnings are $1.49 far exceeding the annual dividend payout of $.80 per share. 

Consider MOLX for the income-producing portion of your portfolio. It is a volatile company. You may be able to write calls and make even more money.  If not, stick with your 3.21 % yield until you have a better opportunity.

Very Truly Yours,
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