☕ Great news for dividend investors – a double
Oct 08, 2026Howdy! 👋
Stocks are down for a second day in a row and the bears who have been beating their chest about “the drop” are starting to emerge from their hideouts. Few will talk about the enormous run-up they’ve missed. 🤦
SOSDD – same old story, different day.
Funny thing about investing is that these people always have a platform because most folks fear losing more than they like winning.
I say focus on winning.
That’s what the world’s most successful investors do, that’s what I’ve helped people just like you do for decades. And folks tell me that it’s worked out pretty well so far. 😃
If you are not investing while the chips are down, you will not be ahead of the game when they're up.
Here’s my playbook.
1 – Bond bears just got schooled
Remember all the hand-wringing lately about who's going to buy America's debt?
The chat-rooms, social media and YouTube have been filled with people insisting the auction would fail, that buyers wouldn’t step up and how both of those things would lead to the end of the financial universe as we know it. Email, too… usually from the hypesters and clickbait artists insisting that you buy this, sell that … or else. 🤦
And?
This week's 10-year Treasury auction "stopped through" by 1.7 basis points.
Translation…
Plenty of buyers were so eager to get their mitts on US Treasury debt that they accepted a lower yield than the market expected going in. A basis point is 1/100th of a percent, so tiny number, BIG signal.
In other words, there was so much demand that they paid more to get less yield.
That's five in a row now, btw.
What catches my attention is that primary dealers – meaning the big Wall Street banks obligated to mop up whatever nobody else wants – took just 2.5%... the lowest on record. Everybody else grabbed the other 97.5% first.
What does this mean for you as an investor?
Plenty.
The "rates are about to blow out" crowd has been mouthing off for months the way the doomsayers have about valuations, the bubble babblers have about AI and all sorts of other stuff.
Meanwhile, the people actually putting real money on the table are betting the other way.
That’s the aha moment.
Big dealers wouldn’t lock in today's yields like a Viking at an all-you-can-eat buffet if they thought much higher yields were right around the corner – meaning they expect rates to moderate and the investing potential associated with great companies to climb.
Does that mean rates can't wiggle?
Of course not.
That’s a given because the US 10-year drives everything from mortgage rates to corporate borrowing costs to what investors will pay for growth stocks. There’s gonna be more adjustment ahead as Fed follies continue.
What this tells us – meaning you and me – as investors is that a calm, well-bid bond market is a tailwind. Not a threat.
Keith's Investing Tip: Follow the money, not the mouths. Headlines are free and usually written by those with no skin in the game. Bond auctions, on the other hand, cost real money and, as usual, that's where the truth shows up first.
You know where to find me but if you’ve got this covered, good on you; an incredible number of investors do not.
2 – How I see earnings and why
I sat down with my good friend and colleague Scott “The Cow Guy” Shellady earlier this week for a wide-ranging discussion about how I see things heading into earnings season and why what’s happening is a wake-up call for anybody paying attention or potentially trapped on the sidelines in doubt or fear.
I’m expecting earnings growth of 25-30% this season, possibly 35%+ with lots of positive earnings and revenue surprises… the kind of setup that speaks volumes about what’s happening and the kind of investing potential that’s up for grabs. (Watch)
We also spoke about the oldest story in the book (Wall Street itself), why individual investors have the upper hand right now, and why gambling is not investing and never will be.
3 – Streaming killed the cable star… then bought a cable company 🤦
Paramount Skydance officially closed its Warner Bros. Discovery deal this week. (Read)
Co-CEO David Ellison says the new Skydance is "positioned to win in every single vertical."
Every single one.
Back in February, I said pass.
Still passing… harder.
Paramount+ and HBO Max are set to merge into one service. That service will sit under the same roof as CBS, CNN, TNT, MTV, BET and a sprawling pay TV portfolio. Only now it comes with $80 billion in what is all but junk debt and a plan to squeeze out $6 billion in savings over three years from tech, marketing, real estate and "some labor."
Call me crazy, but buying 300 channels to get the 2 that I want to watch doesn’t strike me as a great proposition as an investor or simply a person in search of entertainment when I flip on the ol’ tube.
Linear TV is dying.
Keith’s Investing Tip: Buy the best, ignore the rest!®
4 – Great news for dividend investors: Pepsi lands a double
I identified Pepsi on air Monday as a company worthy of your time, particularly for dividend investors. And my faith in the company was not disappointed.
PepsiCo came in with a double – meaning that it beat on both the top and bottom lines:
- Revenue: $25.27 billion vs. $24.96 billion expected
- Core earnings per share: $2.34 vs. $2.29 expected
Then in the same breath, management cut its full-year profit outlook. Core earnings are now expected to grow just 1–2%, down from the low end of its prior 4–6% range.
Good!
Management has recognized that fixing North America is "taking more time than we planned."
I think it’s a great setup given the chart and the fact that activist investor Elliott Management is sitting on a roughly $4 billion stake; they’re not exactly known for patience.
My guess is that the turnaround will accelerate as will the fireworks.
Meanwhile, 54 years of increasing dividends growing at an annualized rate of 4.52% are definitely a plus because it means anybody who owns the stock receives a growing amount of cold hard cash in exchange for the risk they take as a shareholder.
Hmmm.
Trade Idea: Selling Cash Secured Puts could be a high probability way to generate some additional bling and buy shares at an even steeper discount. I’m not sure the volatility is there but it’s worth a look if you’re familiar with the strategy.
As much as I like Pepsi and to be clear, I do prefer other dividend payors at the moment but that’s just me… and scores of folks who are part of the OBA Family.
5 – Game on… pun absolutely intended
In my best boxing announcer voice…
In one corner… weighing in at $300 billion and keen to control their turf (literally)… the NFL told the Supreme Court that prediction markets are gambling. (Read)
In the other… fund companies have filed hundreds of ETFs that track individual NHL and MLB teams through futures tied to single-season performance metrics.
The NFL says “gambling” while ETF sponsors keen to horn in on the action say that it’s a “transparent way for fans to put money behind the teams.”
I was born in the middle of the night, just not last night.
This is gambling, pure and simple, that is being manipulated into legitimacy by a cabal of highly motivated sponsors who will get paid win, lose, or draw.
The fans they think they’re supporting are going to get the short end of the stick just like punters at the track or in Vegas.
Investors, on the other hand, can consider buying the exchanges where these things – the sports ETFs – will trade, because they're gonna collect a few pennies on every bet placed.
I’ll be interested to see where most of these ETFs land – meaning on what exchanges – because the path to profits will probably lead right to it. 😃
Bottom Line
Most investors and traders worry incessantly about what might happen.
The most successful focus on what’s likely to happen. 😀
You got this — I promise.
As always, let’s MAKE it a great day!
Keith 😀
