Mohacsy's Safe Portfolio Member Forum

[trkyhntr]

Homeboy, I have made a bunch of money on the drug stocks by buying them when the analysts have them in the "out of favor" category. MRK comes to mind. I first bought MRK when Hillary (you know. The wicked witch from the northeast.) came out with her socialized medicine plan and all the drug stocks tanked. God, but I wish I had sold the farm and put it all in MRK then. Like Pappy used to say, "Wishin' don't make it so."

I have been accumulating several drug stocks. Those are not stocks I am selling now. First of all, MRK for example pays a pretty nice dividend, so I get paid while I wait for what goes around to come around. A CD at the local bank pays less than 4% interest. The dividend yield on MRK now is 5.5%. Because of the litigation nation we live in, earnings will probably fall a bit for a year or so, but with a dividend of about a buck fifty a year and earnings of about two fifty a year, the dividend appears secure. Sure, there is more risk than there is with a CD. I don't see MRK dropping a whole lot more now, regardless of the legal beagles. I also don't think this is a company that is going out of business anytime soon.

Let others speculate on stocks that don't make money, or have lofty P/E's like Google, for example. I like the cash cows. Having said that, I ain't buyin' GM or F right now.