Dividend Value Investing and the 12 Rules | Kanwal Sarai
Today's episode features Kanwal Sarai from Simply Investing. Kanwal shares with us his unique investing style. This style is a combination of value investing like Warren Buffet and a focus on dividend payouts. Kanwal takes our questions in stride and makes some really great points. Listen, learn, and let us know what you think about this awesome episode. Episode Summary Kanwal's Background Kanwal graduated with a computer science degree at age 24 in 1996 About three years in, he realized traditional work couldn't be a forever path This was before anyone was calling it "F.I.R.E" His first side hustle attempt was purified water Long story short...the side hustle was a flop Neither of them knew anything about marketing/sales Building His Own Investment Method In 2003 Kanwal started developing his own investment strategy His son was just born and was keeping him up all night One of those sleepless nights he grabs an investing book and was hooked At the time he was paying 2.5-3% fees for advisement His main focus came down to strong dividend-paying companies He calls it "Dividend Value Investing" This is a combination of undervalued companies that also pay dividends 12 Part Checklist of Dividend Investing 1. Do you understand the product or service 2. Will people still be using the product/service in 20 years 3. Do they have a low-cost lasting advantage (think Coke's secret recipe) 4. Would you use the product that people would use during a recession 5. Do they have consistent earnings growth 6. Do they have consistent dividend growth 7. Do they have a low payout ratio (dividend vs earnings) 8. Do they have low debt % 9. Do they have a good credit rating 10. Do they actively buy back their shares 11. Is it under or overvalued P/E 25 or less The current dividend yield is higher than the 10-year average Price to Book ratio
