Recent Sell – TIS

It appears to be a busier month than normal.  Today I exited a position that I’ve held since 2013.  Orchids Paper announced this week the suspension of their dividend.  I can’t say this was a total surprise as I’ve had them in my penalty box for a while.  In fact, the comment I made when Investment Hunting sold his position seems eerily prescient:

Yes I still own it but it has never been a DG stock. With a
stagnant dividend, a high payout ratio, previous management’s penchant
for diluting current owners and the frequent misses on earnings I’m at
about break even on this one. This one is a gamble on current
management, their strategy (expansion), and their execution of their
plan with the wild card being stable pulp pricing.
(June 12, 2016)

Since then, the South Carolina expansion has encountered delays, their Mexican venture has had difficulties, they’ve decided to spend money moving the headquarters to Tennessee and finally go hat in hand to their lenders (led by US Bank) for waivers to their loan covenants (which was the likely cause of the suspension).  As this holding was in my IRA, I have no room for a non-dividend payer in that account.

In searching my database, it appears in addition to IH, Broke Dividend Investor sold in September and I think Dividend Pursuit sold around year end.   Meanwhile, Weekly Investment, Passive Income Mavericks, Mr Free at 33 and A Frugal Family’s Journey are contemplating their options.

So an $80 loss is booked which includes the offset by dividends received.

2 thoughts on “Recent Sell – TIS

  1. All part of the game being a long term dividend growth investor. While you may have commented that TIS was never a dividend growth stock and that this elimination seemed inevitable, sometimes even the bluest of blue chips also cut or eliminate their dividends. I have had my share of much more “solid” dividend companies cut their payouts. In all, not too bad of a loss considering the dividends you received along the way. Let’s move on!

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  2. You’re right (guess you caught me venting again). I’ve kind of considered reducing positions anyway so I’ll plow the proceeds into my existing holding of Power Corp (sitting in the IRA anyway). By the way, MET is now higher on my list now that they’ve acknowledged a second quarter of hedging losses and are changing their strategy (although the ex-div just passed).


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