RE:Dividend monster drops dividends and goes all in on CGCI think you mean to say "green chip" instead of "blue chip" when referencing CGC or any other strong MJ market leader
YodaLayhehoo wrote:
https://dividendmonsters.simpl.com/update.html
I started DividendMonsters.com as a fun personal project to share my experience in dividend investing with the goal of helping others to take control of their own finances. I remain very proud of The Flowchart I created and believe this Keep-it-Simple-Stupid approach to investing will consistently beat the mutual funds. I continue to update the site when I have time and plan to resume the "Monthly Monster" picks before long. The site remains completely free and if any of the resources or tips have helped you then I encourage you to pass-it-forward by sharing. After all, investing is not as hard as the "experts" would have you believe. Dividend investing is easy; identifying a company in its infancy with the all the attributes to become a dividend aristocrat in the future takes a lot of hard work. Having said that, I would like to revisit an article I wrote on April 4th, 2015: https://dividendmonsters.simpl.com/sexy_specs.html In that article I explained that I was adding a speculative stock to my portfolio for the first time ever. As a conservative investor, this was not a decision I took lightly. If you took my advice and bought shares of Bedrocan around that time you are likely quite happy with me and your 400% + return on investment. I write that not to gloat (well, maybe a little) but instead to make the point that you have to be good to be lucky! While the KISS approach to investing in safe, solid, dividend paying stocks that pass The Flowchart test allowed me to turn my finances around in four short years, my investment in Bedrocan tripled my portfolio's value in less than two. Although I have been fortunate in life I do not want to discredit the amount of effort and due diligence that went into my Bedrocan investment. I vividly recall asking myself aloud one day what all of the uber successful dividend paying companies that comprised my portfolio had in common? The answer was simple: Those companies were able to capitalize on an emerging global trend at the onset with either a product or a service. Naturally my next question was what's the next trend? I knew cannabis had tremendous medical properties and its stigma was fading. I realize now that I was lucky in that I was able to identify this shift. Subsequent Google searches introduced me to the Canadian Marihuana for Medical Purposes Regulations and heaps of research led me to the companies that planned on capitalizing on this amazing opportunity. Since then I have spent most of my free time... - watching political polls; - reviewing court decisions; - reading message boards; - following politicians, activists, lawyers, and cannabis start-up companies on Twitter; and - listening to licensed cannabis producer's conference calls, reading their financial reports, and emailing their investor relations for clarity. This nightly homework for the past few years has made me knowledgeable in the Canadian Access to Cannabis for Medical Purposes Regulations, its players, and the future of the industry. When I recommended Bedrocan I called it a "sexy spec". That statement only holds true if you drop the "spec" part. A lot has changed since April of 2015: - Bedrocan was purchased by Tweed (another licensed producer) which has since become one of three licensed cannabis facilities under Canopy Growth (CGC.TO). - The Liberals won the election (with a majority) and announced in their speech from the Throne that they were legalizing and regulating marijuana. - A major federal court decision (Allard et al v. Her Majesty the Queen in Right of Canada) forced the Canadian government to make business friendly changes to the MMPR system and rename it the ACMPR. - Canadian licensed cannabis producers began exporting their products and business plans to the rest of the world. As we await the Canadian government's task force recommendations on the legalization of marijuana and the results of the US election, it appears blatantly obvious to me that Canada and Canopy Growth are becoming an example to the rest of the world of what a successful medical and recreational cannabis program should look like. That's why my entire portfolio is invested in Canadian licensed producers and 85% of it is in CGC.TO! Even though I recognized the potential of Bedrocan and this industry in early 2014 I want to clarify that I did not wake up one morning and decide to sell all of my dividend paying stocks in order to invest my life savings into a speculative company. Doing so would be crazy and akin to gambling. The reality is that after some due diligence I concluded that the Canadian cannabis industry had tremendous potential but also great risks. I was willing to sacrifice $1000 for the possibility of centupling my money so I took a tiny position in Bedrocan shortly after their stock market debut. I slowly added to my position in Bedrocan as my knowledge of the industry evolved (remember all that homework?). By the time Tweed bought out Bedrocan it was my largest holding. I initially had mixed feelings about holding the newly formed company known as Canopy Growth as there were still many uncertainties surrounding medical cannabis and the ruling Conservatives had no intention on legalizing the drug. However my homework told me that this new company was strong and hedged well in the event the Conservatives remained in power. Fortunately the polls began to suggest that Canada was headed for a Liberal government and so my investment in CGC grew. I added significant positions in Canopy before the election and again after the Liberals formed the government in Canada with a majority. I continued to add to my position and made my last significant purchase the day after the Allard court decision as my analysis of that decision indicated it was a good thing for the industry even though the market reacted negatively. While nobody knows for certain what exactly legalization in Canada will look like, the key players have essentially confirmed that licensed producers will play a major role in the multi billion dollar industry. In six months marijuana will be legal recreationally in Canada and Canopy Growth appears ready to dominate that market. Australia, Brazil, and Germany seem to be setting up medical cannabis programs similar to Canada and not surprisingly CGC has preemptively made footprints in all of those countries. The future of this company and consequently my portfolio looks extremely bright! All that to say that it is not easy to find the gems in the rough but if you are willing to do the homework you will be rewarded beyond your wildest dreams. CGC is now valued at more than 600 million dollars and the stock is trading at $5.57 which remains an absolute bargain when you consider that we are on the ground floor of a once in a lifetime investing trend. By the time I had done enough research to feel confident enough to recommended Bedrocan in April of 2015 I suggested that the stock had the potential to be worth 100X its current value in ten years. Although its name has changed I am more convinced than ever that my prediction has the potential to come true and my early retirement plans are being further expedited. Of course CGC doesn't pay a dividend and is still a few years away from being considered a blue chip stock but if it keeps executing the way it has been it just might become a future dividend payer.. While sticking to solid dividend paying stocks should be part of everybody's game plan, taking a buy and hold position in Canopy Growth (or Aphria or Mettrum) are worthy of consideration if you are willing to do your own due diligence. Clearly the tide has turned and it won't be long before these companies become household names and the "money experts" start telling everybody about them. 14 OCTOBER 2016