Monday, December 15, 2014

Recent Buy - GlaxoSmithKline (GSK)

Wow the markets have been taking a beating here lately and there's some stocks out there looking pretty cheap. The market volatility coupled with some troubling company headwinds are hitting some stocks extra hard. GSK is certainly not immune to such troubles as the stock has been suffering from slowing sales, job cuts and skepticism about the Novartis deal. Rumors about a takeover are looming but nothing more than rumors at this point. All of this has pulled the stock down to the low $40's and a juicy near 6% yield so I thought I'd average down a bit here.

I have a feeling I may make another purchase this month and I have my eye on a few names including IBM, BBL, T, KMI, CVX, and XOM. Hopefully Santa is good to me so I can get some shares while there's a fire sale! :-o

I purchased 29 shares of GlaxoSmithKline (GSK) @ $42.39

GlaxoSmithKline plc (GSK) is a British multinational pharmaceutical, biologics, vaccines and consumer healthcare company which has its headquarters in Brentford, London. As of March 2014, it was the world's sixth-largest pharmaceutical company. GSK is engaged in the creation and discovery, development, manufacture and marketing of pharmaceutical products, including vaccines, over-the-counter (OTC) medicines and health-related consumer products. GSK’s principal pharmaceutical products include medicines in therapeutic areas: respiratory, anti-virals, central nervous system, cardiovascular and urogenital, metabolic, antibacterials, oncology and emesis, dermatology, rare diseases, immuno-inflammation, vaccines and human immunodeficiency virus (HIV). The Company operates in three primary areas of business: Pharmaceuticals, Vaccines and Consumer Healthcare.

GSK Stock Chart


 

GIS Basic Statistics

  • Ticker Symbol: GSK
  • PE Ratio: 14.3
  • Yield: 5.94%
  • Payout Ratio: 90%
  • Market cap: $99b
  • Beta: 0.86
  • Website: http://www.gsk.com


GSK Dividend Growth


Note the crazy dividend is due to currency fluctuations but the trend is upwards at around 6.5% in the past 5 yrs.

18 comments:

  1. Nice buy. I nearly pulled the trigger on GSK today and will be watching the stock closely.

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  2. Captain Div,

    Nice purchase. My watchlist is interest: IBM, BBL, CVX, RDS and GSK, as well as T. Just too many names that are offering high yields at a discount right now. Wish I had more capital! No purchases for me yet this week, but I guess it's only Monday, we shall see!

    -Lanny

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    Replies
    1. It looks like those are some of the more popular names on peoples radar these days and there is some great values there. I'm looking forward to what you decide to go with.

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  3. Hello Captain:

    I think so, it is a good buy; A few weeks ago I bought it (but in the English market, in GBP) and I have ordered new shares as dividend paid.

    With Grifols, GSK is my second company in health sector.

    See you,

    ClassicCo (an investor from Spain)

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  4. At 5.94% yield it seems like a good purchase. Are you a little worried that the payout ratio is high?

    I wish I have more capital too!

    Note: Typo in your article it should say GSK not GIS. :)

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    Replies
    1. I do love that yield and yes I am a bit worried about the payout ratio but the ratio has been all over the place, it was over 200 in 2010. Yikes! Honestly I have yet to find the perfect stock, you can always find issue with any stock out there. Whether it be MCD with slowing sales or JNJ simply being too expensive you can nitpick anything.

      Thanks for noticing the typo, I'm on it !

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  5. Hi, Captain,

    Very interested in this one, but I prefer to buy it in UK, to diversify currency (GBP).

    Regards from Spain,
    CZD.

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    Replies
    1. Wow my second comment from the land of Spain! Thanks for stopping by.

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    2. This means you're doing a great job! :)

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  6. GSK has a lot working for it in terms of current and pipeline drugs. Love that yield but not that payout ratio. Happy to read about a purchase other than an energy name or BBL. I agree that there are many other names that are also presenting some good values besides falling knives in energy. Thanks for sharing.

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  7. Big pharma is some good long term plays. I like the buy!

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  8. Great purchase Captain. I initiated a position in GSK couple of months back and the stock has gone down a bit since then. But the stock has nice potential with a great pipeline for the long term and a great yield.
    Glad to have you as a fellow shareholder.

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  9. Nice buy. I am a fellow shareholder as well; hoever, I bought in earlier and I have a nice lpos at the moment. But I have no plans to sell the stock as the company is strong, pays a great dividend, and is a major player in the pharm industry. It may be down in the sorth-term, but it will rebound in the medium to long term.

    Again, very solid addition. Keep on adding to your portfolio and increasing your passive income!
    Bert, One of the Dividend Diplomats

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  10. Good morning Captain,

    GSK has been on my radar for more than a year. I love their financials and their aggressive plans to expand in emerging markets. This being said, their new drug pipeline look a bit pale...And for big pharma, that is a big deal...Any insights that you would have on this? Happy new year to you and lots of growing dividends to come.
    LTI

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  11. BTW, I love your blog, very diverse and well documented...I added it to my blogroll :-)

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  12. I've had my eyes on GSK for a while now and will likely add it to my portfolio soon. Pharmaceuticals and Health Care is a sector that my current portfolio has limited exposure to. Aside from GSK and JNJ, do you have any other stocks in this area to recommend?

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