Welcome to my favourite “Monthly Reads” for February 2022! These are articles, podcasts, or videos from the personal finance community and elsewhere that I found especially illuminating, entertaining, or beneficial for anyone on the path the financial independence.
If you missed it, feel free to check out my last edition of monthly reads.
This edition has a bit of a dividend focus. I share some great analysis into Intel’s recent decision to cut their dividend. I also share a great article from Tawcan on how his dividend income has grown over the past 12 years. And finally, I also share an episode from one of my favourite financial-focused podcasts.
Intel’s Massive Dividend Cut
Intel Corp., the world’s largest maker of computer processors, has been in the news a lot lately. First in October, when it announced thousands of job cuts to preserve cash in the face of a slow-down in its chip business.
Next it announced that it was slashing CEO and managers’ pay in a second effort to roll-back spending obligations in the face of headwinds.
And finally, in their latest announcement, Intel is making another drastic change—and this time, investors are directly affected. That’s right, Intel announced that they’re cutting their dividend by over 65% to a meagre 12.5 cents per share—brutal.
This has obviously got long-time Intel investors wondering what on earth they should do with their shares. For a long time, Intel was a dividend stalwart, and with this latest change, has the investment case for Intel changed?
On this topic, I really appreciated Dividendology’s analysis. In it, he worked on calculating Intel’s intrinsic value to try and judge whether it was the right time to sell Intel and move on to greener pastures. He also ran a free cash flow analysis and even shared his dividend discount model.
I highly recommend checking out his channel if you want to learn how to run these calculations and use them to make informed decisions. However, I’d like to pass along a warning: his videos are very spreadsheet focused!
The Most Monotonous Job in the World
If you’re like me and have even a passing interest in finance or economics, I highly recommend you subscribe to the Freakonomics Radio podcast. Host Stephen Dubner and his guests dive into some of the most interesting financial-related stories.
His recent update to one of my favourite episodes was no exception. In it, Stephen tried to answer “Why Does the Most Monotonous Job in the World Pay $1 Million?”
Without burying the lede too much, this episode focuses on the importance of specialization in modern society. And how it affects our economy and, at the individual level, our ability to make a living.
Any football lovers out there (American football, not soccer!) will find this episode especially engaging.
Dividends: Looking Back and Looking Forward
It’s about time I share a blog post from one of my favourite personal finance bloggers—Tawcan!
I’ve been following his blog for a long time now, well before I became a personal finance blogger myself. What I love most about his blog is I feel like he’s on the same path as me, just 10 years into the future. So if you enjoy my blog, you’ll be ecstatic to read his!
His recent post titled Dividend growth – looking back 12 years and looking forward was especially insightful. In it, he looks back on his dividend growth journey and tries to plot what the next 10 years may look like.
In his post, he broke down 3 potential scenarios for his dividend income: aggressive, relaxed, and middle-of-the-road. In each scenario, he estimated how much dividend income he could be earning years into the future, and tried to decide on which approach was best.
If you’re a dividend-focused investor, either through stock picking or through passive ETF investing like myself, I recommend giving this article a read. Either it’ll teach you something new, or it’ll give you something to look forward to when you’re farther along in your journey.
Thanks for Reading!
I hope you enjoyed this little look back at my favourite reads for the month of February. Was there anything great I missed? Any new blogs I should be following or YouTube channels to subscribe to? I’m always looking for recommendations, so don’t hesitate to drop them in the comments below.
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