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Dividend Alerts, September 2010 Issue
September 18, 2010


18 September 2010

  • A Warm Welcome to all our new subscribers!

  • New dividend write-up released: Tesco Plc

  • Market view: FTSE100 index barely to rise till end-2010

  • We value your feedback and suggestions!

  • Know someone who'd like to receive Dividend Alerts?

Dear Subscriber

A warm welcome to our new subscribers.

It’s great that subscriber numbers are growing fast, taking into account that this is only the second edition of Dividend Alerts.

Several of our subscribers have emailed onwards the first edition to someone they know who'd like to receive Dividend Alerts themselves. Big thanks for that! Your endorsement is hugely appreciated and I think this will be an important part of our drive to increase subscriber numbers rapidly.

Simply forward this link to anyone you think could benefit from our publication: https://www.early-retirement-investor.com/dividend-alerts.html

New dividend write-ups released

We have just completed the write-ups on the dividend history and prospects of Tesco Plc.

Tesco enjoys solid revenues and earnings. The company also offers an unbroken record of more than 20 years of increasing dividends and there are no obvious reasons why this can’t continue:

  • Click here for a write up on Tesco's dividend history and prospects as from May 1999.

  • Click here for a write up on Tesco's dividend history and prospects as from May 2005.


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Ask the Editor: Is now the best time to buy shares?

My “doomsday” prediction in the launch edition of Dividend Alerts, that “we may well see new lows by mid 2011”, and “now may not be the best time to buy shares”, has swiftly been rebuffed by a majority of City equity strategist as they expect a bounce in the FTSE 100 index of 8 per cent by mid-2011. For now, though, I’ll stick to my views.

Click here, if you want to read again my views why now may not be the best time to buy shares

Fears over European sovereign debt contagion, the possibility of a double-dip recession in the United States and the UK, the prospect of tax increases and increasing unemployment, the prospect of ‘Weimar’ type inflation deflation and/or stagflation (who knows which one is it be?), and a cooling of growth in China seem to have ebbed away, for now.

And that’s not all. Gold hit a record high earlier this week, backed by a weaker dollar and demand from investors attracted by the metal's role as a possible hedge against both deflation and inflation.

Market view: FTSE 100 index barely to rise till end-2010

Earlier this week, a Reuters poll of City equity strategists showed that they do not expect the FTSE100 share index to change much between now until end-2010, but will bounce 8 percent by mid-2011 as support from overseas earnings offsets worries about the economy.

Median forecasts of 22 equity strategists indicated the FTSE 100 would rise to 5,600 by end-2010, up 0.9 percent from its close on Friday of 5,508 and up 3.4 percent for the year but a far cry from the 21 percent gain seen in 2009.

"We expect that the FTSE 100 will make modest gains over the next six to nine months, supported by earnings growth," Dean Turner, investment strategist at Barclays Wealth, said.

"We are unlikely to see a large multiple expansion until confirmation that the economy avoids a double-dip recession."

The equity strategists said although worries remain over growth in the UK -- data released earlier on Thursday showed retail sales volumes fell in August for the first time since January -- the FTSE 100's global reach should protect earnings.

About 60 percent of FTSE 100 companies' revenues come from sales outside the UK, according to a Reuters analysis of those FTSE 100 companies that break out the figures.

According to Datastream, the FTSE100 index offered earlier this week a dividend yield of 3.29 percent versus a 10-year average of 3.32 percent. The benchmark 10-year British gilts offered a yield of 3.1 percent. While the FTSE100 index carried a 12-month forward price-to-earnings of 9.84 times, versus a 10-year average of 14.86.

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Thank you for reading.

Until next time.

Kind regards

Steven Dotsch Editor Early Retirement Investor.com

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Dividend Alerts is an unregulated product published by EMAR Publishing, publishers of Early Retirement Investor.com

EMAR Publishing is not registered as an investment advisor or financial advisor. We do not and will not provide personalised investment or financial advice, or individually advocate the purchase or sale of any security or investment. We publish opinionated information about the stock market and companies that we believe our subscribers may be interested in.

There is no guarantee that dividends will be paid. Figures are calculated using the closing prices. All gains are gross, and returns will be affected by dividend payments, dealing costs and taxes. Profits from share dealing are a form of income and subject to taxation. Tax treatment depends on individual circumstances and may be subject to change in the future. Editors or contributors may have an interest in shares featured.

Past performance and forecasts are not reliable indicators of future performance. Shares are by their nature speculative and can be volatile. Your capital is at risk so you should never invest more than you can safely afford to lose.

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