The Newest UNESCO World Heritage Sites: Infographic

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UNESCO World Heritage Sites are sites of historic, cultural, scientific or other form of significance and are considered to be outstanding value to humanity according to Wikipedia. To be designated a world heritage site not only brings prestige but also gives a boost to tourism. at 58, Italy has the most number sites in the world with 58 sites. The US has 24 sites. The following shows the latest list of 34 sites that were added to the list.

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Source: Radio Free Europe/Radio Liberty

The Power of Reinvested Dividends: McDonald’s Example

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Investing in dividend-paying stocks is an important strategy for success with investment in equities. Stocks that not only pay dividends but also increase them consistently over time are even better for long-term investment. Picking and holding dividend growers and reinvesting dividends automatically can generate excellent total returns if held over a decade or more. I have written many times before this strategy before as you can see here and here and here. Recently I came an article that showed the power of dividends using the example of the fast food giant McDonald’s(MCD). From the article by Joyce Gordon at Capital Group:

Supersize me: The power of reinvested dividends

One company that has consistently grown its dividends is McDonald’s. To get a sense of how regularly reinvesting dividend payments can compound over time, consider a hypothetical $100,000 investment in the company for the 20 years from December 31, 2000, through December 31, 2020, with all dividends reinvested.

Big Macs were probably not what Albert Einstein imagined when he called compound interest the “Eighth Wonder of the World.” But the power of compounding can be a wonder to behold.

In this hypothetical example, the total return of the investment would have been impressive — from $100,000 to $1,057,057, a 957% gain.

Reinvested dividends: Better than breakfast all day

Sources: Capital Group, FactSet. Growth rate calculations for value of shares from reinvested dividends and dividends paid use the first year’s dividends payment ($676) as a starting value. This information should not be considered a recommendation to purchase or sell a particular security and is provided for illustrative purposes only.

Take a look at what happened with the dividends. The value of shares from reinvested dividends would have grown from $676 in 2001 to $425,940 in 2020, or enough to purchase more than 106,000 Big Macs last year.

The special sauce of compounding in this example lies in the growth in share count from reinvested dividends. The number of shares purchased with the original investment would have been 2,941. By the end of the 20 years, the share count would have increased to 4,926, a 67% increase. For the length of the investment, dividend payments would have represented 40% of the total return.

Source: Dividend growth: The special sauce of long-term investing, Joyce Gordon, Capital Group

The author uses $100K as the original investment in a single stocks. Most retail investors are unlikely to have this amount to invest in one stock. However we can use this case study with a smaller at $10K and the final return of over $100K is great as well.

Who knew that an average fast food company can yield such spectacular returns !

The complete article linked above is worth a read.

Disclosure: No Positions

The World’s Leading Tire Manufacturers by Revenue in 2020: Chart

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The World’s Top Tire Manufacturers based on revenue from tires in 2020 are shown in the chart below. The world’s top tire maker is Michelin(MGDDY) of France followed by Bridgestone (BRDCY) of Japan, Germany’s Continental (CTTAY), US-based Goodyear(GT) and Sumitomo of Japan.

Here is an interesting fact: There used to be two tire makers in the US. But with the acquisition of Cooper Tire & Rubber Company by Goodyear earlier this year, currently there is only US tire company. All the other tires running on American roads are made by foreign manufacturers.

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Source: Tyre Press

Disclosure: Long CTTAY

The Healthcare Industry in the US: Infographic

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The healthcare industry is one of the largest industries in the US employing millions of workers. Due to the fragmented nature of the industry and regulatory burden, employment in the industry is artificially high. It is not uncommon for a hospital system to have hundreds of workers just in the billing department whose only job is to bill insurance companies, patients, governments, etc. Similarly on the insurance company side hundreds or even thousands of people are employed just to deal with all the bills from the hospital and also send out more bills to patients and so forth.

The US spending on healthcare on per capita basis is the highest in the world. The following infographic shows some additional insights on this massive industry:

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Source: The State of Healthcare Industry – Statistics for 2021, PolicyAdvice

Fact of the Day: The Biggest Employer in the UK

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The National Health Service (NHS) is the biggest employer in the UK. The NHS employed over 1.3 million people as January 2021. The NHS is funded directly by taxes and is the fifth largest employer in the world according to an article and one out every 20 employees in the UK works for the NHS.

Source: NHS

The healthcare industry in the US employs more people than the NHS due to the size of the US population. According to a 2018 study, there were 20 million workers in the healthcare industry. Some of the best high-paying jobs are found in this industry. Examples include doctors, nurses, pharmacists, etc.