Tag Archives: finance

Why I Bought Unum Healthcare Today

In the past I have focused on two strategies for my stock investing.  The original one that I started with is what I would call “Quantitative, Fundamental, Technical”.  It focused on finding an industry sector that is performing well (Quantitative analysis).  From there I would start to dig into the best company fundamentally within that sector and then look at the technicals as well.  I would rank those companies that paid a dividend and also were profitable on 16 different aspects and then purchase shares in the one that came out with the best overall rating.

The second investing style that I started utilizing was strictly technically based.  I would look at short term, medium term, and a long term moving averages and then select those over different industries to diversify this portfolio.  To simplify this as much as I can to write this here is as follows:  I would watch for when the stock price was above the short term moving average and where the medium term had just recently crossed above the long term moving average.

My new system is strictly focused around the fundamental analysis of the business and starts with the P/E ratio.  If you look at the P/E ratio of Unum Healthcare, it is currently trading at 9.63 times their trailing earnings and 8.19 their forward earnings.  I’m looking at their historical average P/E ratios for the 5 and the 10 year terms, which are 15.12 and 10.88.  That puts Unum at 37% below their 5 year average P/E and 12% below the 10 year average.  Other positives in the fundamental valuations of the company are the P/B ratio where typically these companies are bought at values around 30% above their book value, Unum currently trades at 5% below their book value so if they were to be bought out you would look for a significant premium to be attached to a bid for their company.

Now for some tough spots that we have noticed on the fundamental side.  The current price is at 71 times the cash value that they have on hand.  The cash amount will be growing again though as they only trade at 8 times their free cash flow amount.

They do pay a decent dividend of 2.2% and over the past few years they have increased the annual dividend rate by 3.67% over the last 3 years and 9.14% over the last 5 years.  They have plenty of room to continue to grow that dividend as well, since their payout is only 20% of their current earnings.  If you are interested in the dividend they will be going ex-dividend on 4/27/16.  They are also buying back stock right now, which some people are not necessarily a fan of but I like that they are returning value to their shareholders.  The current closing price is right at the price where they averaged their buyback price from early 2015 at 33.75 a share.

Just this month they have entered into an agreement to purchase Starmount Life Insurance Company that they expect to be accretive by 2017.  This adds more potential revenue to the top line very quickly.

Lastly, and not that it even entered into my decision when purchasing this company I see that the company is trading above it’s 20, 50, and 200 day moving averages.  The 20 day and 50 day are both trending up, and will likely catch the 200 day soon.  It may be poised for a rally but if you put in a nice 20% stop loss this stock has the potential to run for quite some time going forward.

Happy investing,

Chris

feel free to reach out to me here on the blog, Twitter, Facebook, or at mealickinvesting@gmail.com.

 

More good news this weekend

Some might not say that this is really that good of news, but to me I believe it is good news. After receiving an offer, accepting the offer, and completing the background and drug tests I am officially going to be starting next Monday. The other good news I got this weekend, is that I will be able to stay on with my current employer for Saturdays and Sundays. The good aspect of that, is that we will be able to start paying off some bills that have been nagging us for awhile. The negative aspect is that I won’t be able to go to church with the family still and will be working seven days a week.

My plan is to cleanup as much debt mess as we can over the summer, and then when it comes time for fall to put in for leave until the holiday season again following cross country season. Our team will have a fairly slim racing schedule, and only one weekday race, so I want to be there for every Saturday race I can. This year we are also going to push the kids to meet on Sundays to get a long run in, and I can go and run with the team there as well.

This week I will be working on the house some more, as we try to get it looking as good as possible so we can hopefully sell quickly. Again, I will be trying to get my mileage up as it completely fell apart after my great 5 miler on Monday last week.

Auto Insurance Primer

Maybe back to reality is not a real fitting title here, more like back to blah yesterday.  For some reason I just felt like I never really got going to the level I want to get to each day.  Still excited about my start for this month, just trying to amp up my energy level.  I’ve got to get a copy of The Energy Bus and read it.  I know that somedays just don’t go the way we want, and on a positive note nothing horrible happened it was just a day.  All I can do now is just move forward and set my mind on completing the things that need accomplished.

I wanted to take a minute on this post to reply to a comment on a previous post about car insurance.  There are several things that the insurance companies take into consideration when they are pricing their risk and assigning the corresponding insurance premium.  The primary thing that will be looked at is the individual driver(s) and their previous auto experience (tickets, accidents, comprehensive claims, etc.).  Also, many insurance carriers are selective about which types of vehicles they will insure.  If you have a high horsepower exotic car, you know what I mean here.  Even some not so exotic cars, but ones that had a smaller run of total vehicles are difficult to get competitive pricing due to there not being many replacement parts available.

As an agent I recommend getting higher limits of insurance than many agents do, because our society has increasingly resolved to more lawsuits and claims than just taking care of the issues.  That is why liability insurance is so important, you can be held personally liable for injuries to someone in the case of an accident and it could essentially wipe out your financial life.  After liability insurance is when the rest of the auto insurance aspects should come into play, including Property Damage (damage to another car, building, etc.), Medical Payments (for those riding in your vehicle)and Collision and Comprehensive (for damage to your vehicle) with a deductible you can afford.

Just kind a primer to the world of auto insurance.

Make every day great,

Chris

Time for a market rant

So, I’ve been “perplexed” by this for quite some time.  Why is the stock market continuing to go up?  There really is no valid explanation for it.  The only reason why we are seeing positive run-ups in the stock market as a whole is do to the continuation of quantitative easing by the Fed.  I must be fair to Chairman Bernanke though, as he is not the only central banker that is artificially pumping cash into the system.  The EU is all over it as well.  The only real difference between the time that we are in today and the depression of the 30’s is that they actually allowed the free market to do what it is supposed to do, be free.  I’m not saying I would greatly enjoy seeing my retirement funds drop, but I would appreciate there being just a little honesty in the way the stock market is run.  I think that is probably enough for today, I will step down off my soapbox now.

Make every day great,

Chris

Week 4 of football Friday in Ohio

I doubt that I will be headed to the game tonight for my high school, since it looks like a game that they should win fairly easily.  It’s on the road and I don’t really need to add the extra mileage of driving back to Columbus from home after work.  The cross country team put together a strong fartlek workout last night, and look to be ready to go in their races tomorrow morning.  I’m hoping to see our top runners show some pop this weekend, although their legs are probably still tired from training.

My wife and son will be taking off for Indiana University tonight to go and watch our friend who plays defensive end for them.  Should be a tough game for them, I know they have struggled with Ball State in the past.  I’d love to be going myself but I’d rather be here to help with the cross country team.  When I say help it really just involves some pre-race pep talking and then a lot of yelling during the race, I don’t do much at the race but it’s always fun.

I didn’t get my workout in this morning, but since I’ll be home alone tonight I’ll make sure to get something done tonight.

Yesterday I received another day care prospect due to my marketing of that niche for insurance.  I’m hopeful that we’ll be able to get a competitive price, and I know that I’ll be able to get their operation better liability coverage.  I put out a few more quotes yesterday and am just continuing to try and fill the pipeline with prospects.  It’s been another slow month to start, I’m hoping to come through and have a big second half this month.

Make every day great,

Chris

9/12 update

I didn’t get enough yesterday morning doing the Insanity workout (insert dripping sarcasm), so I ran hill repeats with the high school cross country team.  It went pretty well I can most definitely say they put me through a serious workout.  I guess it was actually my workout, since I came up with the idea but they pushed me to do more than I really wanted to for sure.

Yesterday was a very productive day at the office.  I didn’t write any new business, but I stayed very busy and got a lot of things done that needed to be accomplished.  Working on some new quotes today and some follow-ups with some quotes that I have recently completed.  I’ll also be getting out the pen to work on some more marketing materials, trying to stay relevant and be top of mind for businesses in the Newark and Heath area.

I pulled out my Kiplinger’s magazine and found something else that I need to take care of for the family.  I need to consolidate my student loans at www.loanconsolidation.ed.gov so I can hopefully lower my payments a little bit.  We’ve recently refinanced our mortgage and will be saving about 200 dollars a month there, just trying to keep plugging through the rest of our debts.  I think we’ll also be able to save .25% on our students loans by setting up an automatic payment for them.  It won’t really save us a lot of money in the short term in the amount of our payment, but with our total loan amount a .25% decrease over the entire length of the term will definitely help save us some money.  Trying to do what we can to put our family in the best position we can.  I also made a trade in one of our retirement accounts yesterday, sold my shares of Chevron stock (very few shares) and bought shares of PPL corporation as a nice dividend paying stock.

Make every day great,

Chris

Wednesday 8/15

Ok, so instead of starting with my day yesterday, I’m going to start with this morning.  This morning I woke up and haven’t really felt tired just kind of drawn down.  Cayden woke up around 7, well before I got going to get dressed and head off to work, so we cuddled on the couch and watched Octonauts.  So after that it was almost impossible to get off the couch and get ready, I really wanted to just lay on the couch and cuddle with him or go upstairs and just lay down and cuddle with my beautiful wife.  It is quite often difficult to head to work, not because I don’t like working, but because I just want to spend as much time as I can with the ones I love and that love me.

Now, back to my normal routine of how this blog going.  Yesterday was again a day just chock full of marketing, and learning a new program for our company – sharefile.  This is a pretty awesome program for us, because it is a fully encrypted and secure way to email documents.  This helps set me a little at ease, because we do have a lot of documents that either include medical history or social security numbers.

I read an interesting story about progressive insurance today, and I’m going to reserve my opinion until everything comes out.

Kiplinger’s has some good tips for your home in regards to personal finance.  Some cheap and easy ways to remodel include, updating your front entrance, painting a room, and doing a cabinet makeover.  All of these are fairly inexpensive (can probably do any of them for less than $200) and really can change the appeal of your home.  If you are looking to buy a new home, make sure you know how much you can afford before you find a realtor.  Everyone is going to try and put you in the biggest/best home they can, so know that a lot of banks will look at about 30% of your gross income as the max they will let you borrow (monthly payment).  Look into several different lenders as well, they are really competitive on closing costs right now trying to generate revenue through increasing the number of refinances and new purchases.

Two days until the first cross country meet here in Ohio.  Our team ran some tough hill repeats yesterday, and are thriving on high goals for the upcoming season.

Make every day great,

Chris