# Diebold Securities (DBD:US)



## londoncalling (Sep 17, 2011)

I just learned of this stock from MOA's link on another thread. I couldn't find an existing thread here so I started this one.

http://www.myownadvisor.ca/reader-question-what-stocks-have-paid-dividends-for-generations/

Anyone have any insight into this company from a shareholder perspective? I am going to spend today doing some initial investigation but at a first 15 second glance it seems like something I would want to buy as I diversify my US exposure.

Cheers


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## humble_pie (Jun 7, 2009)

^^

MOA's article is a gem & a must-read even for investors who eschew dividends

but how come diebold is speaking to your heart?


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## treva84 (Dec 9, 2014)

londoncalling said:


> I just learned of this stock from MOA's link on another thread. I couldn't find an existing thread here so I started this one.
> 
> http://www.myownadvisor.ca/reader-question-what-stocks-have-paid-dividends-for-generations/
> 
> ...


So I don't own DBD but I decided to look into it (now, my perspective is DGI so take that with a grain of salt). Here's what I found:



> Diebold is engaged in providing integrated services and software, and security systems to primarily the financial, commercial, retail and other markets. Co. has two lines of business: Financial Self-Service and Security Solutions. The Financial Self-Service provides a line of self-service technologies and services, including automated teller machine (ATM) outsourcing, ATM security, deposit automation, recycling and payment terminals and software. The Security Solutions provides electronic security products such as camera and video surveillance; monitoring and services such as fire detection and managed access control; and physical security and facility products such as vaults and safes.


- A 31 year history of rising dividends, with current yield being 5%
- Current pay out ratio is greater than 100%
- Assets to liability ratio of 1.3
- Graham ratio (P/E x P/B) of 78
- YOY revenue and EPS down 11% / 35% respectively
- Current PE is 21; PE in last 10 years was 34 (so, ~40% lower)
- PEG is 0.3
- Currently oversold as per technical measures.

Their business seems boring and stable so it's odd that revenues are dropping - perhaps there are new competitors? I'd want to read the reports released by management to see what they provide about the explanation of the dropping revenues.

My impressions are that it's a discounted growth stock with negative earnings / negative revenues - perhaps growing pains, perhaps something more sinister (like an erosion of their moat). I suppose it would be an OK value play but I wouldn't buy it as I think their dividend is at a high risk of being cut.


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## londoncalling (Sep 17, 2011)

HP: 
1. It was the only one on the list I had never heard about before. I am very familiar with con ed, Stanley and the like. This was reason enough to start the thread for me.

the rest of the reasons occurred after today's investigation.

2. The business does seem boring and stable yet offer several related services
3. They seem to have been able to evolve over time. 
4. 30 years dividend growth. although very small growth the yield is high for a US name.
5. They are globally diversified.
6. They also have several related business services
7. They just made another acquisition that I believe the market thinks they over paid for. Short term price takes a hit. Long term may not be a huge issue.
8. Institutional ownership in the high 90s.
9. Expecting C$ to stay low for quite some time. Want to start generating more US$ dividends. Have some US$ money to deploy and don't hold a lot of US stocks.
10. Always interested in studying a new stock.

TY for the analysis treva. My research turned up a similar thesis

If I knew why revenues are dropping I would be able to determine whether or not to take a position. Hopefully it is growing pains. I don't know enough about the business yet to comment as to the causes. I don't expect a dividend cut at this time. They made it through the financial crises without doing so. If they did it would be devastating to the share price. However a payout ratio over 100% gives me huge concern. I will have to see if this has happened with this company previously. I also don't expect much in the way of dividend increases. I do feel the recent decline in SP makes it potentially attractive.(30%+).

Edit:

http://3.bp.blogspot.com/-bYiXHl2NC_k/TnY8ioBMiKI/AAAAAAAADD0/PbfiyxMWm54/s400/dpr.jpg

I believe the payout ratio was much higher than it is now in 2007 and they managed to maintain the dividend.


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## dotnet_nerd (Jul 1, 2009)

Diebold? You mean the company behind the rigged elections.

Here's a video demonstration:
https://www.youtube.com/watch?v=u4FPuLNjvAc

(Yes, it's Fox news, but the Princeton University professor is very credible)


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