Printer Friendly Announces that Charles Carlson Highlights the Following Stocks: ExxonMobil, PepsiCo, AT&T, and Johnson & Johnson.

CHICAGO -- Stock splits may be overrated, but they are nonetheless considered to be positive events for investors. Charles Carlson looks at a couple of stock-split candidates in his portfolio, and writes about two other DRIPs that you may want to consider. Read about ExxonMobil (NYSE:XOM), PepsiCo (NYSE:PEP), AT&T (NYSE:T), and Johnson & Johnson (NYSE:JNJ). Charles Carlson is editor of the DRIP Investor newsletter. Click here for the full story exclusively on

Here are the highlights from the Featured Expert column:

DRIP: Editor's Portfolio

The Editor's Portfolio has seen its share of stock splits this year, and Charles Carlson would suspect that there will be more stock splits as the year progresses. As he has discussed in recent DRIP Investor newsletters, stock splits are one of those "feel good" events for investors, although the real benefits of stock splits, it could be argued, are illusory. And yet, the mere fact that we now own more shares of stock in a particular company seems to please us to the point that most investors like to own stocks that split frequently.

Who are the best stock-split candidates in the portfolio? Two that jump out are ExxonMobil (NYSE: XOM) and PepsiCo (NYSE: PEP).

ExxonMobil has been a solid performer in moving to new 52-week highs. The stock is benefiting from high oil prices and the likelihood of solid earnings over the next several quarters. To be sure, it will probably take a price tag in the $50s for ExxonMobil to consider a split. However, Carlson thinks that price level is quite doable over the next 6-12 months.

PepsiCo has been resilient around its 52-week high. Profits have continued to be solid for this consumer-products leader. Given the choppy market that Carlson foresees for the remainder of this year, he believes you will see investors continue to migrate toward blue-chip stocks with dependable earnings streams. That means plenty of investor support for PepsiCo.

AT&T Update

A weak performer so far this year has been AT&T (NYSE: T). The stock has made a series of new lows, and it is hard to find any booster of the stock. Carlson has been saying for some time that, while not a big fan of these shares, he thought the stock could get back above the $20 level in time. While he still believes the underlying assets of AT&T are worth more than $20 per share, he will acknowledge that AT&T's chances of seeing $20 over the next 12 months are fairly slim. Still, the stock is now cheap relative to its underlying assets, and it wouldn't surprise Carlson to see more takeover interest in the telecom sector as a result of the modest valuations. The stock is due for a bounce, and he will continue to hold his shares.

J&J: An Old Favorite Comes Back

Wall Street has not exactly been kind to pharmaceutical stocks in recent years. One stock that had been affected by Wall Street's cold shoulder was Johnson & Johnson (NYSE: JNJ). More recently, however, Johnson & Johnson has been on the rebound. The stock is up nearly 8% so far in 2004, far outpacing the more than 4% decline in the Dow Jones Industrial Average. Solid profit results and a diversified business portfolio are setting the company apart from other health-care issues.

During choppy markets, investors tend to migrate toward blue-chip companies with strong finances and consistent sales, earnings, and dividend records. Such a migration should help build investor support for these shares. For investors who want a broad-based play in the health-care sector, this old favorite of Carlson's remains a top selection. Investors should note that the company's dividend reinvestment plan requires shareholders to own at least one share -- and the share must be registered in the investor's name, not the "street" name-- in order to be eligible to join the plan.

Learn about the benefits of DRIP investing through Charles Carlson's commentaries and stock analysis by clicking:

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Publication:Business Wire
Date:Aug 2, 2004
Previous Article:Employease Announces Record Results for First Half of 2004; 27 Consecutive Quarters of Revenue Growth, Growth Up-Market and Channel Sales Growth.
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