Lately, I’ve been obsessed with everything Jeff Bezos, CEO of Amazon. I’d love to own his stock, but not at these prices. Does that mean the stock is going down? Hardly! I just don’t see the margin of safety—a term coined by the late, great Benjamin Graham who taught Warren Buffett a thing or two about investing. You won’t be surprised by this, but Mr. Graham paid particularly close attention to one word: Dividends.
Bezos’ Amazon doesn’t pay a dividend. But it does deliver. Sometimes the foyer at my house feels like a fulfillment center with all the boxes. Everything Bezos touches, like an anti-Midas, goes down in price. He’s what Walmart wants to be when they figure out this internet thing. And by the way, it is a thing.
How long will it take Amazon to supplant UPS? Fedex? I don’t know, but I’m not betting against Jeff. You want a cheaper way to get to space? Leave it to Jeff. I signed-up for tickets to space at Blue Origin, his rocket company, simply to watch how fast ticket prices go down. [inlinetweet prefix=”” tweeter=”” suffix=””]I’ll call it Bezos’ Law[/inlinetweet].
But let’s not let the billionaire have all the fun. Imagine if his stock paid a dividend. You’d have a seat at the table for every shareholder meeting. “So what?” you’d say to yourself, “if Bezos doesn’t like the bright lights of CEO stardom.” You’d be heard. You would be the one clinking your tin cup on the glossy conference table, “Ah, Mr. Bezos, about this quarter’s dividend,” you’d pronounce, “can we expect an increase?” Note to self: Just ask for that dividend increase when he’s in a good mood. Right after that infectious laugh would be good.
OK, so the dividend from Amazon, never mind the increase, isn’t coming anytime soon. One way to invest in Amazon right now is to align your portfolio in dividend paying companies that benefit from Bezos’ Law. You get the best of both worlds: Jeff and Dividends. No reason to bet against Jeff. Are you crazy? And no reason to invest in this stock market unless you’re getting paid (dividends). Now what? Want to invest in our latest idea? Subscribe to our client letter (free even for non-clients), or let us do the heavy thinking and become a client at Richard C. Young & Co., Ltd.
Flight Four – One Chute Out
Jeff Bezos vs. Peter Thiel and Donald Trump | Jeff Bezos, CEO Amazon | Code Conference 2016
E.J. Smith - Your Survival Guy
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