Wednesday, October 24, 2012

McDonalds Company, MCD Dividend Machine for week of Oct 22, 2012


McDonalds,  when populations increase they eat more McDonalds - Dividend Machine for the week of October 22, 2012.
           
McDonalds, symbol MCD, has been on my radar many times in past decades.  However, once I started using my very specific dividend machine criteria, MCD did not show up as the first dividend machine I found with my screen until this week.   Like MSFT, McDonald’s price was too high or the dividend too low to qualify as a bona fide dividend machine.   Recently, McDonald’s qualified on every other dividend criteria except yield and now we have the dividend yield greater than 3%.


INCOME is the point of my dividend machine strategy and I require a minimal amount of income from every dollar I invest.  I have to beat the 10 year treasury (not too hard these days) and I have to beat inflation.  Currently a three percent yield is the minimum I expect.


INCREASING INCOME is very important to retired people because we really do not want to have to go back to work.  My income has to increase every year because my basic expenses increase every year.  Some years, expenses increase less than other years and vice versa; but over time you must create a portfolio of securities that is highly likely to steadily increase.


If it makes you feel better about MCD as a dividend machine you can assure yourself that population growth and fast food intake tend to grow together.   This dividend project does not feel better about a security because the company is in the right sector or because it is the current hot idea; we  use only the company’s history of sharing income with us, their ability to earn more than they pay us and their management of debt to guide us.


With that in mind, please review the fundamental data on McDonalds Corp, MCD as you consider how to create your income portfolio.


DIVIDEND MACHINE
10/24/2012
McDonalds Corp.
MCD
Price when profiled
$87.28
Last 4 Qtrs Earnings
$5.32
Last 4 Qtrs Dividends
$1.14
Current Qtr Dividend
$0.77
Annualized Div Yield
3.53%
No. Years Div Increase
35
Debt/Equity ratio
.97%



Very Truly Yours,

TheMoneyMadam