Tag Archives: Altria Group

The 3 Silliest Company Name Changes Ever

By Dan Caplinger, The Motley Fool

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The best companies in the world invest huge amounts of money and energy into building name awareness. The right name can be worth tens of billions of dollars to a company, making it all the more important for companies to make the best choice.

Often, though, companies pick what seem on the surface to be ill-considered new names. Inspired by Thursday’s announcement from Coinstar to seek shareholder approval to change its name to Outerwall, here’s a list of five company name changes that earned criticism and even outright mockery when they were first proposed.

2001: Altria
In late 2001, the company then known as Philip Morris made a proposal to change its name to Altria. The origin of the name was founded in the Latin word “altus,” meaning “high,” and was meant to associate the company with peak performance. The “tri” embedded in the name also emphasized the fact that the company at the time had three distinct divisions: domestic tobacco, international tobacco, and its Kraft Foods beverage and food division.

Image copyright Altria Group.

The name change reflected the company’s wish to have consumers and investors see beyond its tobacco business, which at the time was plagued by more substantial legal battles with billions in potential liability hanging in the balance. Shareholders approved the name change in 2002. The irony, of course, is that Altria has since spun off both Kraft and its Philip Morris International global tobacco divisions, leaving Altria holding the old core Philip Morris USA division.

2011: Qwikster
Fortunately, this name change never actually took place, but for the short period that Netflix considered it, Qwikster caused both an uproar among customers and a crisis of confidence for Netflix investors. The idea was to separate out Netflix’s legacy DVD business from its faster-growing, higher-potential video streaming business and rename the DVD-delivery company Qwikster, with the streaming business keeping the Netflix name.

Image: Wikimedia Commons, photographed by user Coolcaesar.

But coming on the heels of a bungled rate-increase announcement that sent costs up as much as 60% for users who wanted to keep both services, the proposed Qwikster name became closely affiliated with the misstep. The stock also plunged, losing half its value — more than $100 per share — in less than a month from the time of the rate increase to the time Netflix backed away from the proposal.

2012: Mondelez International
Kraft has been associated with two different name-change controversies. Last year, the company broke into two parts, with its North American grocery division keeping the legacy Kraft name while its global snack-food business changed its name to Mondelez International . In explaining the change, the company said that Mondelez “is a newly coined word that evokes the idea of a world of ‘delicious products.'”

The company helped come up with the idea by having an

Source: FULL ARTICLE at DailyFinance

Dividend Investors Shrug Off Mayor Bloomberg's Anti-Smoking Campaign

By Rich Smith, The Motley Fool

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On March 18, New York Mayor Michael Bloomberg asked his city council to outlaw the public display of cigarettes for sale. If the Democrat-dominated council complies, it will soon become illegal in New York City for vendors of smokes to show customers their wares. They’ll have to be hidden from plain view — stored in cabinets or under counters, for example. Yet it appears that dividend investors invested in smoking stocks don’t see a problem with that.

Already, Bloomberg has pushed through laws raising taxes on tobacco and banning smoking in restaurants and bars, and even in outdoor parks. As for this latest initiative, when asked about Bloomberg’s move last month, City Council Speaker Christine Quinn pronounced herself “very, very open” to the idea.

So why aren’t tobacco stocks suffering?

Dividend investors still hot on smokes
Since news of Mayor Bloomberg‘s proposal broke, shares of tobacco industry bellwether Altria Group are up nearly 5% in value. Lorillard and Reynolds American are up 4.2% each, and even British American Tobacco has notched a respectable 3.4% gain.

There are probably two reasons for this — maybe two and a half.

Hey, New York: Get over yourself
First and foremost, it’s not as if the New York market is the be-all and end-all for these companies. “Gotham” it might be, but America’s most populous city is still just one city, and most of these companies sell across the country and around the globe. So any decrease in tobacco sales caused by a new point-of-sale display ban will only dent the companies’ revenue streams — not dry them up entirely. What’s more, even in NYC, cigarettes will still be available for sale. They just won’t be visible.

The other important factor buoying tobacco stocks among dividend investors is the valuations attached to these companies’ shares.

Buy discount cigarettes here
After all, tobacco stocks weren’t particularly pricey to begin with, giving them some room to run. If your average stock on the S&P 500 today costs a bit more than 14 times forward earnings to purchase, then all four of these stocks charge less than that. Altria, Reynolds, and BAT all sell for about 13 times earnings and change. Lorillard is a relative bargain at just 12.1 times forward earnings.

And of course, the real attraction of these stocks is their generous dividend payments. From a very respectable 2.5% dividend yield at BAT — two-tenths of a percent more than the average S&P stock pays — dividend yields among this group of stocks quickly rocket up the scale to Altria’s premium 5.1% yield, to 5.3% at Reynolds, and a whopping 5.4% at Lorillard.

Like a nice, long drag on a smoke, there’s nothing quite like a big, fat dividend yield to ease investors’ worries when Big Government tries to stress ’em out.

Altria has been the best-performing stock of the past 50 years, but as the number of smokers in the U.S. …read more

Source: FULL ARTICLE at DailyFinance

Winning Stocks: Rarer Than You Might Think

By Morgan Housel, The Motley Fool

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Can you pick winning stocks? Yes. Many have done it. 

But winning stocks may be rarer than some think, especially over long periods of time.

In this video, Fool analysts Matt Koppenheffer and Morgan Housel share some data showing the returns of 3,000 stocks over a 28-year period. There were plenty of winners — but a whole lot of utter losers, too. Have a look:

The Motley Fool’s chief investment officer has selected his No. 1 stock for the next year. Find out which stock it is in the brand-new free report: “The Motley Fool’s Top Stock for 2013.” Just click here to access the report and find out the name of this under-the-radar company.

The article Winning Stocks: Rarer Than You Might Think originally appeared on Fool.com.

Morgan Housel owns shares of Altria Group. The Motley Fool recommends Apple and Coca-Cola. The Motley Fool owns shares of Apple. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

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Source: FULL ARTICLE at DailyFinance

What Happens to Stocks When the Fed Bids Farewell?

By Morgan Housel and Austin Smith, The Motley Fool

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Last week, the Federal Reserve reassured investors that it will keep its foot on the monetary gas pedal. This is good news for stocks — for the time being.

But what happens when the Fed decides to let up, reining in its super-loose money policies of the last five years?

investors naturally fear a big market pullback. And that may be what occurs. But in this video, Fool analysts Morgan Housel and Austin Smith discuss the other side of the story and why an end to easy money doesn’t necessarily mean the end of stocks.

The Motley Fool’s chief investment officer has selected his No. 1 stock for the next year. Find out which stock it is in the brand-new free report “The Motley Fool’s Top Stock for 2013.” Just click here to access the report and find out the name of this under-the-radar company.

The article What Happens to Stocks When the Fed Bids Farewell? originally appeared on Fool.com.

Fool contributor Morgan Housel owns shares of Altria Group, Procter & Gamble, and Philip Morris International. Austin Smith owns shares of Philip Morris International and Colgate-Palmolive. The Motley Fool recommends Procter & Gamble. The Motley Fool owns shares of Philip Morris International. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

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Source: FULL ARTICLE at DailyFinance