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Welcome back, INVESTOR! It’s been said that “creative destruction” is at the heart of capitalism and eventually, every business will fall to its destructive forces. But, these destructive forces are great for the consumer as innovations make products and services cheaper, faster, and more available. If a business has a protective moat, it will always be under attack and it’s just a matter of time before the cheaper, faster, and better forces breach the fortress walls and crown a new king. This is the challenge of change as an investor. The Durant-Dort Carriage Company was founded in 1886, and by 1900 it was the #1 U.S. horse-drawn buggy company. Its founder William Durant sold out of the business in 1914, it stopped making carriages in 1917 and was dissolved in 1924. It took 31 years for creative destruction to claim another victim. This week, there was big media news as Disney, Fox, and Warner Bros. Discovery announced a joint venture sports streaming app set to launch later this year. The aim is to deal another blow to the legacy cable and satellite companies while providing the sports nut with the biggest single source of sports content in one place. But, each entity will have a 1/3 stake, and streaming has been a very unprofitable venture for those not named Netflix. Not to mention the local affiliates each of these entities have that would likely suffer, it could be a net negative for all involved. But I digress trying to make future predictions. Our Nexstar Media (NXST) stock was down 10% the next day as the reaction was this would hurt local sports programming ad revenue from its affiliates and reduce their profit margins. We took advantage of the sudden price drop to add a few more shares, but to be honest, I felt unsure about it. The thought was that yes, while this is a potential new headwind, I’m betting on Nexstar’s jockey – founder and CEO Perry Sook. Perry has over 43 years of industry experience and has grown Nexstar into a media behemoth. So, if there’s anyone who might find new opportunities to navigate a changing media environment, I believe it’s him. This brings us to a critical aspect of investing in individual businesses – understanding and trusting the management team. When we buy a share of stock, we trust that management will make smart decisions to increase the profitability of the business, increasing demand for the stock and raising the share price. But, we must always be aware of the changes brought about by creative destruction, which is always lurking about. William Durant could have been the best business manager that the world had ever seen, but when that world no longer wants your product or service, the writing is on the wall. I will be keeping a VERY close eye on Nexstar over the coming years, and if revenue starts a steady decline, it will likely be time to exit owning this business. Because, as John Maynard Keynes said, “When the facts change, I change my mind – what do you do?” I’d love to know if there are any businesses you’re worried about because of the forces of “creative destruction” by hitting reply! 😁Special THANK YOU to the (8) people who responded to the last newsletter!! Be sure to check out a few of the responses below. That said, let’s get to the moves made this week. And remember, you can always check out the PORTFOLIOS, the PODCAST, or see what’s cooking on the YouTube channel. Dividends Received This Week ~$1.32
Dividends Received Year to Date~
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Source: Charles Schwab |
Stocks Sold (AVERAGE)
- 11 Albertsons (ACI) | $21.15
Stocks Bought (AVERAGE)
- 3 Realty Income (O) | $53.10
- 1 Toronto-Dominion Bank (TD) | $59.64
- 4 Nexstar Media (NXST) | $156.00
- 3 Johnson & Johnson (JNJ) | $155.50
- 5 Harrow Inc. (HROW) | $9.30
Notable Ex-Dividends This Week + SSD Score
- 2/13 Kenvue (KVUE), 4.14% | 70S
- 2/13 ExxonMobil (XOM), 3.73% | 80S
- 2/14 Microsoft (MSFT), 0.71% | 99VS
- 2/14 Kroger (KR), 2.55% | 71S
- 2/15 Black Hills (BKH), 5.04% | 77S
- 2/15 Duke Energy (DUK), 4.47% | 80S
- 2/15 Chevron (CVX), 4.32% | 90VS
- 2/16 Johnson & Johnson (JNJ), 3.04% | 99VS
- 2/16 Hershey (HSY), 2.80% | 93VS
- 2/16 UPS (UPS), 4.46% | 69S
- 2/16 Prudential Financial (PRU), 4.93% | 75S
🎙️Podcasts You Should Check Out!🎙️
🤑 Fund Manager Ian Cassel was on We Study Billionaires and talked about “Active Patience” – knowing exactly what you want and waiting patiently until you see it. I highly recommend this episode!
🎧 And with the Super Bowl being this week, check out Motley Fool Money as they discuss stocks for the Super Bowl and if they are worth your attention. (Hint: I like $PEP)
✍️What You Said!✍️
Credit to Ryne Williams for the inspiration here!
In last week’s newsletter, I asked if any of the Crossing Wall Street ideas interested you.
Jim said, “With the exception of Hershey’s in my wife’s account, I don’t own any of these”.
Michael said, “It was a cool list, there are some good companies on it, and he could see himself owning some of them but is at his limit for new positions.”
Steve said, “Interesting site, enjoys exploring new ideas, was disappointed to not find Eddy’s rationale or criteria for buying”, and mentioned that he finally sold Leggett & Platt (LEG) with a total return of -20%.
Ron said, “I own 4 of the companies on the list and Hershey (HSY) is on his current buy list”.
Investing Newsletters You Might Like
⭐Ryne Williams writes a free weekly dividend newsletter and creates multiple top-notch YouTube videos every week. This is a community for dividend investors by dividend investors.
🤑Connor Von Ooyen used to build mobile games at Zynga, and became obsessed with the stock market, so he built an AI tool to scour the internet for the best stock market ideas and news and summarize straight to your inbox. Check out The Yellowbrick Road newsletter!
💰Dividend Earner wants to make your money work for you through dividend growth investing and shares all his holdings and trades monthly. Learn from my mistakes and profit from my success by subscribing to his newsletter.
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Random music video I enjoy and you might too!
🎵The Replacements – Bastards of Young🎵
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