No I don't need money, nor do I have any health problems or trouble with the law. My trouble right now is a lack of investment ideas. So I'm calling on this great FI/DGI community for some ideas. The markets have continued on their almost never-ending climb higher, but there's always value out there if you can find it. The biggest problem is that the companies that I'd love to add to right now I also happen to be overweight those positions.
McDonalds seems to offer some good value here, but it also makes up around 10% of my invested capital right now. So I'm not exactly looking to buy any unless I deem it truly undervalued, but I feel it's around the fair value mark. Another one is Target, but I'm in a similar situation there with it making up around 6.5% of my portfolio's value. So once again I'm not that eager to add more to that position at this time.
The best value that I really see happens to be in energy and technology. I currently have around a 7% allocation to tech, which is in the area of what I'd like to keep it. Tech companies are much harder to have confidence in than a Proctor & Gamble or Coca-Cola. If you don't believe that then go ask Blackberry's investors who've seen the company go from an $80 billion company back in 2008 to possibly being bought out now just 5 years later. As far as energy goes, I'm currently allocated at around 18% of my portfolio. I'd like to get that lower but that's going to take some time as I'm leaning towards purchasing some shares either Kinder Morgan, Inc. or Chevron.
Some other companies I'm interested in are Walmart and Pepsi but their yields are relatively low. Walmart is currently trading at a slight discount to its 5 year average dividend yield while Pepsi is at a significant premium. On a forward P/E basis Pepsi is trading with around a 18 and Walmart is near 14. I don't like to go too much based off of forward P/E ratios because the future is uncertain.
Of course I can always just continue to build up cash and wait for better opportunities. I can't predict where the markets will go from here so just waiting for greener pastures that might not come isn't realistic as well.
Are you sitting on the sidelines and building cash or continuing to invest? What companies are you interested in?