kelbon,Agreed, its about the investing thesis, the portfolio thesis and the parallel risk management approach. There is risk to the income investor if they wait, they lose the current price, they lose the near term income. The trade off is that they wait and receive no income on the educated guess that the stock price will come down, they will receive a higher yield and some capital games. This is why pricing a stock is so varied, there is no ONE correct answer because there are many ways to invest and many ways to manage risk and many risks to manage. What is the opportunity risk/reward profile for waiting? Is the reward worth the risk? What is the risk/reward profile of buying now? Is the reward worth the risk? I think low 50's is a fair value with limited risk to a long term buy and holding dividend income stream investor. The price will go lower than today and it will rise higher than today. GIS has a history of increasing dividends. GIS is financially sound. GIS has a history of being reasonably well run. GIS sells a product that must be replaced. Is this enough of a reason to buy? If and only if you are seeking to buy good companies at fair prices and are seeking their dividends and it is the best one you can find. Circumstances and methods matter. If someone bought this just after the meltdown for $20 it would make perfect sense for them to sell and take the capital gains then roll that into a stock that provided them with greater income. They could hold because its not over valued but only if value is the primary focus. If income is the primary focus then rolling that capital into a larger income stream makes more sense. Buying 1000 shares @ $20 which was about a 5.75% yield gives them an income stream of $57.50. Which grew and they cashed for 5 years. They have earned, estimated, $2,043 and have cap gains of 30,000. If they cash out they have $50,000 to work with, even if they got 3% yield they would more than double their income stream. This example isn't an argument for value investing its an argument for income investing, how do we increase the income stream? From this prospective if they hold it now do they continue to hold for this income stream? Is there a better stream available worth the friction costs to switch? If they don't own it now is it the 'best' income stream currently available to them?I repeat circumstances and methods matter.I love value investing but if income stream is the game value investing is not likely to give you consistent predictable income. The value games returns are lumpy. Value players ought to be holding on poor yielding cash which has limited value to the investor seeking income but great potential returns to the value investor. I'm not saying price doesn't matter or that value doesn't matter what I am saying is that for an income investor value isn't in the drivers seat, income is.jack
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