Author: Bill DeShurko, 401 Advisor
Disclaimer: Bill DeShurko owns VZ, NLY and ALSK in his Covestor Value Plus Model.
October 4, 2010: Currently the portfolio has 8 holdings and approximately 10% in cash. Gains have been led by Verizon Wireless (VZ) with over a 10% gain in September including the monthly value of its dividend. Other holdings, such as Annaly Capital management, Inc. (NLY up 1.27%) and Alaska Communications Systems Group, Inc (ALSK up 5.07%) have shown modest increases in share price but have contributed with their high yields of 15.41% and 8.71% respectively (as of October 4, 2010).
Going forward we still think a double dip recession will be avoided. While October tends to be a month of surprises, we expect earnings to remain solid, and a large enough Republican win in November to stalemate Congress. A rally to the end of the year will depend on the likelihood of reinstating the Bush Tax Cuts, killing cap and trade, and in general, a less regulatory attitude toward business from Washington.
We expect to hold tight with our portfolio for October. Verizon may be getting near our price target, but with a yield just under 6%, as of October 4, we still find it attractive.
