How to Build a Dividend Growth Portfolio in an Overpriced Market | FAST Graphs

[@evanshoa]

I think a very helpful video would be one where you discussed holdings that you have sold and the reasons why. I find that I can make buy decisions a lot easier than sell decisions. How does the Buy and Hold, three to five year horizon investor decide to sell? What are the basic fundamentals you look at and how much do they have to deteriorate before you have had enough

[@larryevans2806]

I'm late getting to this but thoroughly enjoyed it. Excellent!!

[@brucedryden7207]

Excellent presentation, Thank You.

[@tiagosantos680]

Loved this video, you are the best Chuck

[@NiekVink]

Amazingly informative video, thank you so much Chuck.Greets from the Netherlands

[@menlubruce580]

I too would like to see 10 to 15 new undervalued Stocks that can offer total return and a seconod portfolio offering Dividend growth. I have gone through all your preset files and done my homework but having your perspective helps alot.

[@InvestingTips-g4u]

Very nice and informative 👍

[@FxAndrej]

@5.25 - "Know thyself". Indeed, but easier said than done. People misevaluate themselves very easily and by a wide margin. "Everyone's a long-term investor until the market goes down" - Peter Lynch. The only way to TRULY know thyself is to get into the ring and receive a few punches. You're lucky if it happens when your portfolio is still small. I have a growth ETF, but a big chunk of my equity is in 4-6% yielding boring dividend payers to SWAN. Good luck everyone.

[@FASTgraphs]

Thanks for sharing your view. In my experience what you're describing highlights 1 of the greatest benefits of FAST Graphs. During the 2008 - 2009 great recession subscribers (clients) were empowered to clearly see the true worth value of their stock versus how the market was reacting with price thanks to FG. Therefore, it was much easier for them to stay the course and eventually participate in 1 of the greatest bull markets we've ever seen.

[@capitalconsultingus]

Another Great Clinic Chuck... It is really hard to find great businesses at reasonable prices in today's environment.. Would be interesting to see an Aug 24 portfolio (Models 1, 2 and 3)... an idea for you. This tool is THE BEST!!

[@DobyDuke]

As a dividend investor, I’m ok with the stock having down times, allows me to buy with a higher rate!

[@FASTgraphs]

I agree, as long as fundamentals remain intact.

[@cwilson6880]

When to sell?!? I find myself having no issue with stocks that have gone down or negative in my portfolio as it’s a chance to buy and lower my price. As they’ve been researched and bought at a good valuation. I DO have a problem knowing when to sell or rotate into another company. For instance, bought NEE about a year ago and sitting up about 50%, currently fully valued 24 or vs 5yr of 23.08. Was actually thinking to rotate into growing my UGI which is pretty undervalued currently. Is this commonly done as a dividend/value investor, or do you typically wait longer as I’ve only held it a year? Any input on this would be helpful!! Just trying to figure this out at 50 years young 😅

[@pearlperlitavenegas2023]

You don't have to sell if you purchased it fir dividend income ​@@cwilson6880

[@johnstewart5221]

can u do a video covering UGI, would love to learn more

[@cwilson6880]

I’d second that as I’ve been growing a position the last few months 👍🏻

[@chuckdiezel7652]

Thanks Chuck, would be great to see a list and video on 10 undervalued stocks for total return in this overvalued market

[@udarpavarota396]

It's not about being right or wrong because nothing is excluded from happening in the future. It's about managing risk.

[@investoreyes1]

UGI is the only one I would pick on this list for long-term hold at the moment

[@mik19111]

Great video. More etf’s besides spy would be helpful. Thanks

[@SaharshSinha-zb4rr]

helpful video

[@jameswhittaker3565]

Great review chuck. some times it hard to keep up with all changes.

[@marksoberay2318]

Chuck i cant emphasize enough how important videos like this are because it shows your theories are working. Do you manage money? If so im in

[@FASTgraphs]

Thanks, yes I do. Contact: [e-mail] she can provide information and schedule a WebEx meeting

[@Stm3030]

Where does the time go, long term investing is the key.

[@podlyesnyy]

Hi, Chuck great episode as usual. In your episode you mentioned about managing portfolio and you would have cut Walgreens sooner. I know I did. It would be very educational to know what would be the triggers in your head to start thinking about cutting losses specifically when the underlying business fundamentals are deteriorating. Thank you.

[@FASTgraphs]

1st and foremost, investors must realize that mistakes can be made. As a result, there’s no guarantee that WBA would’ve been sold with a minimal loss. Judgment is always required. In truth and fact I do hold WBA and have not sold it. In other words it was a mistake. However, proper diversification is The damage to a minimum. Nevertheless, to answer your question more specifically, what triggers me is collapsing fundamentals. Also, I like to have a suitable replacement in mind before I pull the trigger. Although I regret not selling WBA, I do believe the price is currently far below intrinsic value. So I continue to hold looking for an exit point. In other occasions I have done much better. Win some, lose some. but proper diversification does provide protection.

[@podlyesnyy]

@@FASTgraphs Thank you very much. I have experienced that the investing in many instances is an art. But it sure helps to have an instrument like FASTGraphs. I think it's irreplaceable tool. Given that mistakes are expected and as investors we should do less stupid things. I would appreciate if you could go though the model portfolios and attempt to "groom" it as if you would manage it for the purposes of trimming it, as a guidelines obviously just to get into your approach how you think about when the stock goes onto a chopping block, perhaps not yet removed from portfolio but goes on notice so to speak. Long term vs short term consideration, tax loss harvesting etc. Is there some rule o thumb or check list of some kind that you have, or is it a gut feel after listening to earning call. So going through the model portfolio with the brush would be entertaining and educational. Thank you.

[@dunesmom7990]

I like GSL and BMO.

[@timannetteboogerd415]

Chuck, for the next video-Where do you see value in this overvalued market??

[@cwilson6880]

When to sell?!? I find myself having no issue with stocks that have gone down or negative in my portfolio as it’s a chance to buy and lower my price; as they’ve been researched and bought at a good valuation on solid fundamentals. That said I DO have a problem knowing when to sell or rotate into another company. For instance, bought NEE about a year ago and sitting up about 50%, currently fully valued 24 or vs 5yr of 23.08. Was actually thinking to rotate into growing my UGI which is pretty undervalued currently. Is this commonly done as a dividend/value investor, or do you typically wait longer as I’ve only held it a year? Any input on this would be helpful!! Just trying to figure this out at 50 years young 😅

[@jovokrneta1412]

Hi @FASTGraphs how do you see MPW now? Have fundamentals worsen there by your view of things? Would you hold MPW now? I myself am still holding and expecting a better 2025 year after Steward is resolved and rates have been cut. Keep on with the great work 👍

[@FASTgraphs]

The fundamentals are technically getting better, but also getting worse at the same time. Limiting the dividend to the $0.08 a share will provide approximate 7% yield to new investors. Previous investors need to hold for the long run is the company sells its problems. Nevertheless, it will take time for the company's true value to be realized in my humble opinion.

[@jovokrneta1412]

@@FASTgraphs Are you able to elaborate technicals getting better and worse at the same time? Sounds interesting...

[@crrrrg]

@FASTgraphs Thank you for the video. Does Fast Graphs also have historical P/E ratios for other indices, like the Russell 2000/1000?

[@FASTgraphs]

coming soon

[@xJoeKing]

I'm left wondering if valuation matters and the degree to which it matters...

[@FASTgraphs]

With all due respect, a subscription to FAST Graphs will illustrate beyond any shadow of a doubt just exactly how important valuation is, in the long run. In the short run emotions determine market price with the primary emotions being fear or greed. However, in the long run earnings (operating results) will determine market price. I trust fundamentals far more than I could never trust volatile and fickle stock prices.

[@erdrick22]

Valuation matters and it matters a lot !

[@et_phonehome_2822]

Chuck, great presentation, but back then the market was in turmoil due to Covid scare. Stocks back then was cheaper in price compared today. What model portfolio would you have during this time with the higher stock valuations?

[@FASTgraphs]

In the video I pointed out that valuations are almost identical today as they were back on August 24, 2021. Watch the video again where I illustrate the S&P 500 (SPY)

[@Awalktowealth]

Great video, Chuck! My long term portfolio (30 stocks) aligns most with model 2, but I struggle with my ongoing strategy. Currently, I’m DCA’ing and keeping the portfolio equal weight. This reduces risk, but somewhat ignores valuation. I’d be interested to hear your thoughts on investing overtime. Maybe I should be investing more to companies that have better valuations. Any thoughts?

[@daniell6303]

Why would you equal weight / average winners and losers?

[@FASTgraphs]

I would need to know more details to give a comprehensive answer like the 30 stocks. But with that said, dollar cost averaging is an effective long-term strategy. On the other hand, my personal choice is to only invest more into a stock if the valuation makes sense. Nevertheless, dollar cost averaging will work out the long run. Regards, Chuck

[@Awalktowealth]

@@FASTgraphs Thanks for the reply! I’m leaning towards that approach. Love FASTgraphs - the first tool I purchased when I started investing. Still my favorite!

[@Awalktowealth]

@@daniell6303 the 30 stocks are what I consider high-quality dividend growers (the group has an average 15% dividend growth rate over the last 5 years) and split pretty evenly over industries (no industry has more than 20% weight). My thought is that they will all grow over the long run so equal investments keeps any one stock or industry from getting overweight. Still thinking through if I want to keep this simple strategy or invest more based on valuation.

[@FASTgraphs]

@@Awalktowealth thank you

[@Ed-bj5eq]

thanks Chuck for this great update. If instead of individual stock picking we decided to invest in dividend growth+income portfolio with ETFs, are SCHD and DGRO fairly valued today ?

[@FASTgraphs]

Personally, I don't know. However, I do know how to figure that out with FAST Graphs. Simply create a portfolio of the constituents and then sort them by value utilizing either earnings yield or P/E ratios. Also, we are working on launching an ETF package that will allow us to create a Fastgraph on an ETF.

[@Ed-bj5eq]

@@FASTgraphs Thanks Chuck, that is great news on the ETF Fastgraph will be a usefull addition

[@528jb]

Hi Chuck. I am a FG subscriber. Is there a way to sort my portfolio and watchlist by how far current price is to the orange or blue lines?

[@FASTgraphs]

Thanks for the question. Keep in mind there are numerous metrics to evaluate on a FG. You have 3 earnings, 2 cash flow, EBITDA, EBIT, and sales that all have an orange valuation reference line. Nevertheless, for the majority of companies (those growing at less than 15% per annum) remember that a 15 P/E ratio will be the most common multiple. Furthermore, this multiple also represents the inverse (E/P) which is an earnings yield of 6.67%. Therefore, you can sort your portfolio by adding columns for P/E and earnings yield. Then a few sort those my highest to lowest or vice versa you can simply see that in a stock with an earnings yield (whatever metric you are looking at) above 6.67% will be below the orange line in any earnings yield below 6.67% will be above it. You can gauge the magnitude by the size of the number. For growth stocks (those growing faster than 15% - the formula is P/E ratio equal to earnings growth rate) you can compare the current P/E ratio to the estimated growth rate. Once again if the current P/E ratio is above the estimated growth rate the price will be above the orange line if the current P/E ratio is below the estimated growth rate it will be below it. The key is to understand the formulas used by FG which can be found in the learning center. Hope this helps, Chuck

[@Mixa2025]

Is ABBVIE overvalued based on the graph you showed Chuck?

[@FASTgraphs]

Yes, I consider ABBV overvalued at the present time. However, although I would not add capital at these levels, I still consider it a long-term hold. In my world, there is a distinction between a buy decision and a sell decision. Furthermore, since I bought it and the long-term dividend growth stock and considering my low cost basis I plan to hold it for years to come unless he gets ridiculously overvalued. Regards, Chuck

[@Mixa2025]

@@FASTgraphs Thank you very much for your insights, Chuck!

[@CapCashOG]

Hi Chuck, question about Verizon. It trades currently at a 15 p/e. Do you really think the real value is around 60$?

[@FASTgraphs]

Thanks for the question, not sure where you are getting your 15 P/E ratio. Utilizing a blended P/E ratio based on adjusted operating earnings Verizon's current P/E ratio is 8.87. You are most likely looking at trailing 12 months (TTM) earnings. I do believe that Verizon should be trading at a 15 P/E ratio based on current adjusted operating earnings earnings. That would value the company at a price even higher than $60. The $60 number I offered was a very conservative estimation. Regards, Chuck

[@hansschotterradler3772]

@@FASTgraphs It's hard for me to imagine that VZ's P/E expands to 15 with all that debt. But sentiment can change over the years.

[@CapCashOG]

@@FASTgraphsthanks for your answer.

[@FASTgraphs]

@@hansschotterradler3772 even a no growth investment is worth a 15 PE in my humble opinion. Consider that a no growth 5% bond trades at 20 times interest.

[@matthewnewton1476]

Is everything viewed in this video available in the basic version of FAST graphs?

[@FASTgraphs]

Yes, except for the "Advanced Portfolio" feature - that is in the Premium Version of FAST Graphs - docs.fastgraphs.com/en/articles/9491824-what-are-the-differences-between-basic-and-premium

[@DobyDuke]

Like the video!

[@mrbigcat9]

SPY is weighted why not use RSP which is equal weighted?

[@edmp123]

2 reasons, one I only have the SPY until we get a full ETF package which is coming soon. The 2nd reason is the S&P 500 is the most commonly referred to market index. Nevertheless, benchmarking is not really what this video was about. This video was about value investing and generating above average income as a result. Regards, Chuck

[@mrbigcat9]

@@edmp123 So, if the SPY is over valued can you assume the same for RSP too? We did referred to it initially?

[@Duke-225]

Two comments: 1) When the stock market crashes, nearly every stock goes down in price. It's virtually impossible to avoid losses. "Cheap" stocks just get cheaper. It is unrealistic to have any other expectation in a long portfolio. 2) The presence of a dividend distribution should never be a factor in an investor's decision matrix. Dividends do not matter. All the peer reviewed academic studies prove it. What you might get by selecting from only dividend stocks is naïve exposure to the value factor. As Munger (or was it Buffett?) said: An investor should be indifferent toward a dollar received in a dividend and a dollar retained by the company where it can be used for a number of things, all positive for shareholders.

[@FASTgraphs]

With all due respect, your comments are both very misguided. For starters, although it is true that all stocks may drop in a market crash, what you are misunderstanding is that the inexpensive stocks will inevitably recover back to their intrinsic value- which is higher than where the prices were when the market crashed. The overpriced stocks in contrast also recover back to their intrinsic value, but that value is typically far below what they were trading at when they were overpriced and the market crashed. Secondly, the idea that dividends don’t matter is foolish. The beauty of dividends are that the best dividend growth stocks increase their dividend every year and shareholders keeps getting a raise without selling any of their stock and depleting the portfolio. Furthermore, if a company cannot put their retained earnings to work it makes sense to distribute it to shareholders. More wealth has been destroyed by overzealous managers who were recklessly trying to grow their businesses, especially beyond their comfort zones. Which is precisely why many great businesses pay dividends. Including the ones that Warren Buffett favors in his portfolios. Regards, Chuck

[@ahsugoi]

@Duke-225 Important and valid points for sure.

[@lord_voldemort44]

walgreens over cvs? nahhhhh

[@FASTgraphs]

At the time Walgreens had a higher yield than CVS which was the objective of building this portfolio. In hindsight you are right, but it did not look that way in August 2021

[@lord_voldemort44]

@@FASTgraphs i actually use your product now to aid my decision to keep adding cvs stock to my portfolio. lets hope i am right haha

[@vladimirsmiljic9780]

Dont think so yi have smsll position in cvs csnt wait to get rid of it​@@lord_voldemort44

[@killersentra]

Depends each have their own strength. CVS is typically selling the products over priced. Walgreens is more moderate in their pricing. Somehow lacks in popularity to CVS.....each can make improvements in their stores.

[@katielowen]

Both are very bad choice 🧢