Market Wrap-Up for Aug.1 (MA, ENR, ALL, CMCSA, HOG, more)

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Investors were anxiously awaiting commentary from the latest Federal Reserve meeting today on where the direction of interest rates and the economy were headed. Some had been speculating that if the Fed plans on further easing (printing money) at all, the announcement will have to be made today. Waiting until the next Fed meetings in September or October would leave the Fed open to accusations of trying to influence this year's Presidential election. When the news officially came out, nothing really changed as far as the cautionary stance is concerned. The bottom line is low interest rates in the cards for the next couple of years, according to today's announcement.

Despite all the focus on the Fed meeting, several major earnings reports remained front and center. Investors liked today's results from Allstate ( ALL ) and Comcast ( CMCSA ). On the flip side, investors were not too thrilled with numbers from Energizer Holdings ( ENR ), Harley-Davidson ( HOG ), Devon Energy ( DVN ), and Mastercard ( MA ).

As always, you can view all of our recent earnings report coverage and much more over on The Dividend Daily .

Wal-Mart Shares Up 50% in 12 Months!

I'm sure many market watchers will be stunned to realize a super-mature retailer like Wal-Mart Stores ( WMT ) is up 50% over the last 12 months. This is the type of move that makes the best analysts on the street scratch their head. Has WMT discovered a tremendous new revenue source? Certainly not. Has a big acquisition started paying off? Nope. Does the company have incredible growth prospects? Not really.

In reality, WMT's huge move is part of our "yield chase" concerns building in the markets. From a valuation standpoint, 17 times 2013 earnings is not super-expensive, but how much of the earnings-per-share growth is coming from share buybacks vs. actual earnings growth is a key question for WMT shareholders to consider.

A former recommendation of ours, we downgraded WMT to "Hold" ("Neutral") when it approached the $60 mark, since its yield simply wasn't that attractive at those levels. The stock has run all the way up to $75 since then. Obviously we underestimated investors' appetites to chase yields all the was down to the 2% level in some cases.

Over the history of investing in the markets, we have seen periods where investors reach for yield - and almost always regret the outcome when the markets revert to the means. The crowded trade tends to be the most dangerous one for investors, and it is our job to point these situations out. Then it's your job as an investor to evaluate how you should be positioned going forward.

After all, investing is always about the future.

Year-to-Date Results Just Posted

Be sure to check out the year-to-date watchlist posts up on the site today. You can see how well many of the dividend stocks we are tracking have done through the first seven months of 2012. As always, you can find these and other members-only articles on Dividend.com Premium Articles Page .

An Important Note Regarding the Best Dividend Stocks List

We want to make sure everyone understands that the stocks on our Best Dividend Stocks List are the names we currently like for new investor capital, regardless of what date the stock was first recommended on. If and when a stock is removed from the list, we will clearly state whether the stock should be sold (which is rare but occasionally will happen), or simply held in one's account until we see a better entry point or catalyst.

And here's one last thing to remember about what we do here at Dividend.com: it's not just the names that we recommend that can help you build wealth, but also the things we try to steer you away from that are just as important. Forget about speculative or penny stocks, chasing unprofitable IPOs, and listening to the manic talking heads in the business media!

Our Beat The Markets with Dividend Stocks eBook Has Arrived!

We just debuted our brand new 275-page eBook, exclusively on Dividend.com! In this digital-only book, we look ahead to 2012 and the main factors that could affect dividend investors. A $39.95 value, the eBook is a free download for paid Dividend.com Premium subscribers.

Beat The Markets with Dividend Stocks contains a full economic forecast for 2012, including in-depth analysis on 65 of the biggest dividend stocks out there. It's a great way to get prepared for your investing next year! So head over to the Dividend.com Premium homepage now to download your copy.

A Dividend Capture Strategy for Active Investors

We now offer complete U.S. dividend data for all Dividend.com Premium members, so anyone that focuses on "Dividend Capture" trading strategies should have plenty of good stuff to research each day. Just check our enhanced Ex-Dividend Calendar , which is the best in the business, to search for upcoming payouts.

Speaking of dividend capture, Dividend.com Premium members can also access a 9-page report we published on the essential elements to any successful dividend capture strategy. Be sure to check it out here on the Premium homepage .

Thanks for reading everybody. I'll see you tomorrow!

Be sure to visit our complete recommended list of the Best Dividend Stocks , as well as a detailed explanation of our ratings system here .



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

Created by Dividend.com


This article appears in: Investing , Stocks

Referenced Stocks: ALL , CMCSA , DVN , ENR , HOG

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