Dec 20, 2012|
Stock Talk - RJ Hottovy, Morningstar
Transcript - Not for consumer use. Robot overlords only. Will not be accurate.
After today's contest is black widow in junior bill. I've always been a big fan of dividend paying stocks up love them love them love them love them. Our guest RJ how to -- from Morningstar his first pick is a dividend paying stock that of course being McDonald's that morning RJR you don't. First thing that caught my attention 3.4 percent dividend yield on shares of McDonald. Is that -- you like it or is there another story behind McDonald's that makes you bullish on the stock. That's part of the story and we've certainly seen the market wrote in the dividend -- names but this is one of the names that it's a great three Iran prior to 2012 but a couple missed let's this year accompaniment to this product pipeline walls and the strong it has been in past years. You have smacked usually issues terms of the value menu as well I think it's also traversed Bashir and the company's the first when. Your recent memory will be -- easier comparisons among the two quick service restaurant industry. And I think it's what you turn around but now it wat does take we can't turn out also that dividends and you have paid to weightlessness. Now I read an analyst report on this is that ninety dollars a share another analyst not Morningstar thinks it's worth about 97 and twelve months do you have the price target monitor. It's fair value estimate what do you think the fair value estimate is on this yeah. Fair value which is essentially the intrinsic value of the stock soared today actually -- -- -- fort archer share. Assistant general ballpark. Up but there are some multiple lovers both sides of that you know and more polished it ordinary -- -- they increased scale of the more emerging markets like China and another agent reasons. Yes certainly that you can put some amount about a hundred arsenic in. Not higher amounts up men managed see how -- how they get back in action -- All right so McDonald's first pick symbol Ford is MCD you get paid a dividend yield of 3.4 percent while you wait for this company to turn it around and raise their stock price or have a higher stock price. Your second pick is Starbucks SBU. Acts. Also a dividend Payer but a very modest dividend of one and a half percent. You're kind of in a minority when you like the stock market and yesterday ate a lot of lot of negative sentiment -- -- -- start trying to. Yeah I mean I had it is yet that that the bear case on the company's. The company is meant a lot acquisition the last eighteen months and the last. Over that period of quite to -- Those being evolution fresh. Which is registry. Concept. -- a lot which is more of bakery. Pastry type concept based out of that. That's -- most recently been required to keep not which is he retailer and open -- can prevent more petite bark about at the barricade. It is that they -- have too much on the plate to really manage the business. But haven't spoke of the management team and I think that got -- -- that's -- well one divisions and managers behind those positions I think that there have been the biggest difference. -- you know entry at the transitions from more -- retailer and or package could company. Which -- higher margin business. There's a lot of potential sources speak actual outside the specimens. So that's what really exciting game and that there may be some give and take it -- You know integrate these new businesses and to that the overall portfolio but and I think he got to go to the bigger picture here and I think that's stocks we talked to walk around. All right and 54 is the current price. Another analyst has a when your target on at a sixty what do you think. Not get it about 67 as well I think into the value. But if -- ever looking at all the different. Companies and the restaurant category and ranked them on the order of who's got must potential upside might indicate turnout. -- -- Starbucks a populist. All right -- RJ thank you very much for your -- -- But RJ how to be to stock picks Starbucks at 54 dollars a share and McDonald symbol for Starbucks SB. You X symbol for McDonald's and CD currently trading at about ninety dollars a share what do you think about this whole story June McDonald's Corp. Telling their franchise owners we watch it opened up on Christmas Day. Well you know it's franchise to franchise so you don't have to do it but if you do own one and you wanna make some extra money in because what they say 5500 dollars or 55000 dollars or something each franchise that they stay open you know I'm -- but then who's gonna work the the -- through. Who's gonna make the burgers and he'd prefer ice on prisons that are you go to McDonald's on Christmas Day had no -- I am not in and I guess that's the channel -- is trying to imagine. Who weakness while I think I did think about this I'm -- breakfast. Maybe you get not your drive into -- Kids house you grant -- I mean who knows him and you want that coffee muffin man thinking that might be what you think. Yeah yeah and I'm not I'm not there yet I can't have I ever gone to limit is this is at the -- if you go to the McDonald's drive through. I go to McDonald's. Part to look at the there it doesn't look like competitive headlight look like -- -- like it looks like it's inside of a guy any day I I like McDonald's is as much as the next guy so the Prius has gone through the -- and -- time are far too many times I will say that he just put it that way. -- you know -- I get the number six supersize me you know you know what not. You don't. Now I don't -- you try going to one of those girls she goes in and looks at the menu and says well let's look at different retirement. I despise -- -- of -- go to mcdonalds you better you typically know what you're gonna get to it will watch the U every four hours -- -- new things and that doesn't do. I. Place in the same thing their -- of the fighters anyway. Let's get to something much more important we're going to discuss in the next segment. June knight's personal defects yes we'll let you know she has. Mini trip from what I'm told she has many character defects and Judy just so it's not perceived as -- and you. And what you tell lots. Which. You have been right -- lie what it is a financial show why are we doing it because it's it's fun and and we have time. And and I want to and -- to break can I go out ankle wife and your personal defects like that you are short list I don't have any person. That everybody the only advice I have is I smoke cigars other than an imperfect. Closet cigar smoker because of never seeing it -- to office. That's next on the financial.