By: Dividend Sensei
We all want to get rich on Wall Street – or at least reach our financial goals such as a comfortable retirement. That’s what Dividend Kings is determined to help you achieve.
We do that by recognizing broader trends and specific opportunities. For instance, despite everything, stocks are still the best-performing asset in history…
And cigarette-maker Altria (MO) is the second-best performing stock of the last 50 years. From 1969 to 2019, it’s offered investors 18.7% annual total returns, including dividends.
That adds up to a 519,060% total return, which means that every $1,000 invested became $519,070.
And today, it’s paying about $41,000 per year in dividends.
I cover this significant stock in more depth at Dividend Kings. But all put together, let’s just say it has a lot of valuable lessons for investors to learn…
The simplest of all being the critical concept of margin of safety.
The Secret to Success on Wall Street Is No Secret at All
Joel Greenblatt, who’s made 40% annual returns for 21 years now over at Gotham Capital, has said that, “Buying good businesses at bargain prices is the secret to making lots of money.”
That’s something the greatest investors in history have been preaching for decades, pointing to the easiest path to riches through:
- Quality assets
- Reasonable to attractive valuations
- Sound risk management that lets you hold such stocks for the long-term, compounding your wealth in the process.
In which case, Altria is a perfect company to highlight the importance of margin of safety, otherwise known as the discount to fair value.