Since taking the resolution to focus more on international stocks, I have been able to spend more time looking through some of them. For no particular reason, two stocks that I looked into were European telecom companies, Vodafone (VOD) and Telefonica (TEF). As I have started to look into stocks that could be added into the Ultimate sustainable dividend portfolio, today I decided to take a longer look into the top ADR’s trying to find companies that have a high dividend yield but also have decent market cap and seem to have enough numbers to warrant further research…

Shocking Results….

I’m very surprised to see that 9 of the top 16 ADR’s that came out are telecom related. How in the world is it possible? It seems like it’s not only in North America that we see such companies. In the US, FTR has been at the top of the dividend rankings for a very long time… FTR has proven to be a very bad dividend pick. I will be taking a much deeper look into these names in the coming months both here and in our free mailing list. If you have not joined, do so now, it’s free:

The major downside of course is that for some of these companies, it’s much more difficult to get information about how they’re doing, etc. Still, since they are traded on US stock exchanges, it does require these companies to report “standard” financial statements.

As we enter 2012, I will also be posting more often about the UDSP (Ultimate Dividend Stock Portfolio) and as you know, some stocks will need to be taken out over time. You can expect those to be replaced by more international names, which can probably be found somewhere on this list. For now though, I will leave you with this list, from which I will do further analysis next week on the mailing list. Please feel free to send out any comments about these names.

Here is the top 50 of the names that we follow, ranked by dividend yield, which as we have seen is rarely the best way to choose dividend stocks. Still, it’s a good starting point:

With US markets closed yesterday for MLK day, I will be opening both the trade announced yesterday (AAPL vs NILE) and this one, Dice Holdings (DHX) vs Monster Worldwide (MWW). Somehow, this is one of those pairs of stocks that often seems to be out of sync.

Both companies operate “job listing” properties but in very different ways. While Monster has worked hard to build a global brand, a network of sites that is used and known almost everywhere around the world and used for virtually any type of job, Dice Holdings has a fairly different strategy. The company manages a few different websites that generally specialize in one specific industry such as eFinancialCareer for the financial industry.

Let’s take a look at the numbers before going further:

Long Dice Holdings (DHX)

The big number that I always look at is the estimated P/E ratio for next year. In this case, both companies have a nearly identical ratio which is certainly surprising because DHX has been able to increase revenues consistently by nearly 20%, that makes its current valuation very attractive in my opinion. The company is also able to focus on its properties much more than a broader company like Monster. The counter-argument though is that Dice Holdings relies on a few key industries such as the financial industry in order to achieve its growth.

Short Monster Worldwide (MWW)

In the past few years that I have been tracking tech stocks, Monster has been one of the very consistently overpriced stocks in my opinion (with Blue Nile-NILE) and I honestly do not see any reason why. At least, Blue Nile seems to have the potential to increase its sales and profits at some point down the road. I don’t see it with Monster. I think that by the time the company will have reached a large enough scale, rivals such as LinkedIn (LNKD) and perhaps Facebook will have taken their place as leaders. Monster has been unable to grow revenue anywhere near its numbers from 4-5 years ago. That is shocking in my opinion. Can the company turn things around? Sure, at some point. But I’m bettong that the stock will head lower before that happens.

Disclosure: Will go long Dice Holdings (DHX) and short Monster Worldwide (MWW) on Tuesday morning

No, no, this is not a repeat post, I’m actually opening up the same trade that I traded on January 6th only to close it a week later or so. I always try to find good trade opportunities and while it would be nice to always come up with new trading ideas, I’ve got to be honest, my main priority is to make money, not be “original” in trying to do so.

Another good question would be why I closed out this trade if I was going to open up the same one a few days later. That is certainly a fair question. Recently, I started writing for the tech stocks newsletter about why I use stop losses and stop gains. It’s a critical part of what I do in my opinion. You could certainly argue, as one reader did by email last week, that my stops are too aggressive and that I should let trades go a bit further. That is something I’ve been thinking about for some time now and I finally decided to not include it in my 2012 trading changes. It might change during the year but so far, the current recipe has worked awfully well for me to contemplate this change.

2012 is off to a great start for my trading as I am now up on all 3 trades including 2 that were closed very quickly. That is certainly not typical and with earnings season starting soon (Google is one big name reporting next week), volatility will certainly spike up. That is one reason why you should not expect me to trade on Google (GOOG) this week.

Back to our trade, here are the relevant numbers for both companies:

Long Apple (AAPL)

Apple has increased a bit this year (a bit over 3%) but that is far from enough for me to back off my statement that Apple is clearly the #1 tech company in terms of value vs price. The downside is very limited in my opinion given its valuations but the upside isn’t. There are now clear rumors that the production of the iPad3 is under way and that will give yet another boost to 2012 sales and profits. I’m also hoping for more news about the iPhone5 and the eventual release of the Apple TV to keep the momentum strong. I’ve written a few posts about Apple lately so I’ll link to those if you are curious about my thoughts about the company.

-You’d be crazy to not own Apple (AAPL)
-So Apple…let me get this straight

Short Blue Nile (NILE)

I do hesitate to some degree about shorting NILE at this price because the stock is already down considerably this year (almost 12%).. That could certainly bring a rebound, it would be far from shocking. However, if I forget that for a second and simply look at valuations, the stock remains very expensive and I don’t see anything to justify the valuation so in the medium term, I do expect more downside. Of course, NILE’s Q4 earnings to be released in Mid-February will be big because that would be the company’s biggest sales period by far. It should be interesting…

Disclosure: Will go Long Apple (AAPL) and Short Blue Nile (NILE) on Monday’s opening

Wow, who would have thought, a second trading being closed in as many days! On Monday morning, I will be closing out the trade opened just one week ago, Long TripAdvisor (TRIP) & Short (AOL) which currently stands at +27%.

I got a good question today regarding how I calculate returns. I think I’ve gotten into some detail about this over time but probably never in a single post. Next Friday, I will discuss exactly that. Let me know if you have any questions regarding these returns, I’ll be more than happy to answer. In the meantime, have a great weekend! I will be opening one new trade Monday and hopefully Tuesday as well.

IS

Wow, I had talked about having butterflies in my stomach, about how things might be more difficult, especially if my first few trades did not go well. Knock on wood, but so far so good. One week after opening the trade where I went long Apple (AAPL) and short Blue Nile (NILE), the trade ended up reaching its stop gain today and I will be closing it on tomorrow’s opening.

The trade currently stands at +20,68% with the two other trades also doing very well. Let’s hope things do keep up. I will be opening a new trade on Monday if all goes according to plan.

Feel free to join our free technology stocks newsletter below if you want more details about our trades and the stocks that we follow here:

Late last year, I did a few surveys to find out what IntelligentSpeculator readers liked the most and wanted to see more of. The Ultimate Sustainable Dividend Portfolio post that we published in September was clearly a favorite. It made us possible for me to give 20 dividend stock picks that would provide long term sustainable dividend flows to build passive income. I’ve decided to build upon this by doing monthly updates of this portfolio. The picks were made on September 14th 2011 so I will be using the previous night’s prices as my reference.

I could be using any amount but I will be starting off with a $20,000 capital so exactly $1000 into each of the 20 stocks. As you can see in the chart below the value of the portfolio has clearly increased which you would expect since the S&P500 has done exactly that as well. To be fair to the mentality shift that I’ve discussed I will be more focused on increasing the monthly cash flows that will come from this portfolio over time than the actual value.

I do expect for dividends to be a bit more volatile from month to month but they should increase steadily over time so that will be an important metric. In the first 4 months, the portfolio generated $165 of dividends. In the next few months, I will be giving monthly updates to this amount so we’ll see how that goes. Here is the amount to start off:

Returns

I will also be comparing the returns of this portfolio to the return of the S&P500 (with dividends reinvested).. Keep in mind that I would expect the Ultimate Sustainable to do better in difficult times and worse in great times. Why? The USDP is a more stable portfolio that will fluctuate less over time.

Trades

Every month, I will discuss trades that will be done in the portfolio, they will only be done once per month and most months will actually have no new activity. These are sustainable dividend picks so there is no reason to become too active.

As I have discussed in the recent past, there are two main flaws that I will want to address in the near future for this portfolio:

-Over exposure to the oil sector (I will likely take out an oil stock in the next few months)
-Under exposure to international dividend stocks

For now, I do expect to keep the portfolio at 20 stocks so any new stock being added will replace an existing one. I strongly recommend that you join our free mailing list if you are interested in dividend stocks, that is where most of the discussions regarding new stocks to add will be done. To sign up, simply enter your name below:

As always, I would love to hear your thoughts on this. It is the first of many posts on the USDP and I do hope to make this a very interesting part of this blog.