I just logged into my retirement account and noticed that the RAI, LO merger has gone through. My 33.69 shares of LO turned into 9.89 shares of RAI and a deposit of $1,717.10 into my account.
So what would you do?
Would you immediately buy shares in RAI? Would you spread the money out into other stocks? Would you buy a different tobacco company like MO or PM to stay in the same area as LO but could provide better returns than RAI that has a PE of 25?
I currently have a list of 5 other stocks that I would like to be a part owner of so I could easily spread the money out into those. They are OHI, DPS, DE, T and BA.
At the time of the LO merger, I was receiving roughly a 3.65% yield on my money so I would like to get at least that through a single purchase or a combination of different companies so I do not lose out on any dividend income.
I'm leaning towards buying some more OHI since they are still depressed a good bit and then some DPS because they have fallen from their highs by roughly 8%. I'd be looking to initiate a position on a 10% pullback.
Any advice is greatly appreciated. One of my best picks is now gone... :( If I had it my way, LO and RAI would have never merged, but so is life.
Lets try to pick out my next best performer!!