A disquiet settled upon me last week, a familiar tremor in the vast landscape of investments. It is a sensation not unlike the premonition of a change in the weather, a subtle shift in the currents of fortune. One observes the market, and it is easy to succumb to the anxieties of the moment. Yet, a seasoned observer knows that to hold steadfastly through such turbulence is often the most prudent course. To seize opportunities presented by temporary declines, to add to positions of conviction – these are the actions of a rational man. To sell, in such times, is a more difficult decision, a severing of ties that requires justification. And sever ties I did, last week, with three holdings that, upon careful consideration, no longer aligned with the long view.
I parted ways with shares of Verizon Communications (VZ 0.26%), Target (TGT 0.96%), and Baidu (NASDAQ: BIDU). It is a truth universally acknowledged that an investor must sometimes relinquish one holding to acquire another. But the choice of these particular companies was not made lightly. It was born of a prolonged contemplation of their trajectories, their inherent strengths and weaknesses, and their ultimate place within the ever-shifting panorama of global commerce. Let me share the reasoning that led me to this course.
Verizon
Three summers ago, I began to accumulate shares of this wireless carrier, at a time when such companies were held in low esteem. The grand promises of 5G technology had yet to translate into tangible growth, and whispers circulated regarding the buried legacy of lead-sheathed cables, a dark secret beneath the surface of progress. It appeared a contrarian bet, and I confess, a part of me was drawn to the challenge of discerning value where others saw only risk. The dividend was generous, a steady stream of income in a world of uncertainty, and the stock itself seemed undervalued, a rare jewel amidst a sea of inflated valuations. Most importantly, it felt as if Verizon operated within an industry impervious to the vagaries of fortune – a provider of essential services, a lifeline in the modern age. The recent consolidation of its rivals further strengthened its position, affording it a degree of pricing power.
However, the financial performance has been…uninspiring. For sixteen consecutive years, revenue growth has remained stubbornly below 6%. In the last four years, it has failed to surpass 3%. And the outlook for the future offers little cause for optimism. Analysts predict a modest 4% increase this year, followed by a decline to below 2% in each of the following four. Yet, the stock itself has defied this reality, surging 25% this year, outperforming the market by a considerable margin. The once-generous 7% dividend has dwindled to 5.6%. Over the past three years, I added to my position, allowing it to become the fourth-largest holding in my portfolio. It stood as a curious anomaly – a financial laggard amidst a collection of more dynamic enterprises. Now, it stands out for its outperformance, a testament to the capricious nature of the market. Verizon remains the highest-yielding stock in the Dow Jones Industrial Average (^DJI 0.60%), consistently generating double-digit net margins and serving 146.7 million wireless retail connections. But in a world awash with opportunities, one must sometimes make difficult choices. And so, I sold, to free capital for more promising ventures.
Target
Target, too, was a security blanket I chose to discard. Another company yielding a substantial dividend, with an even longer streak of annual payout increases than Verizon. It moved higher early in the week, defying the prevailing downward trend. A momentum investor might have celebrated such strength, but I am not driven by fleeting gains. I am drawn to enduring value, to companies with a clear and sustainable path to prosperity. Target’s trajectory, however, has been…meandering. It has endured three consecutive years of declining sales, a troubling sign for any enterprise. A new CEO offers a glimmer of hope, but turnarounds take time, and success is never guaranteed. The stock remains cheap, with guidance calling for earnings per share of $7.50 to $8.50 in the year ahead.
Like Verizon, Target stock has risen nearly 25% in 2026, a curious phenomenon for a company losing market share. I may revisit Target in the future, but for now, it served as the means to a different purchase. As the sage Omar Little observed, “You come at a Dividend King, you best not miss.” And I, sir, did not miss the opportunity to reallocate capital to more fertile ground.
Baidu
Finally, we come to Baidu, the dominant search engine in China. It shares a common trait with the other two companies I sold: a history of weak growth in recent years. Baidu has experienced negative revenue growth in three of the past four. Yet, it has also enjoyed a surge in its stock price, rising 35% over the past year. The market has warmed to Chinese tech leaders, recognizing the potential of the world’s second-largest economy and the importance of homegrown companies in driving the next wave of innovation in artificial intelligence. Baidu, despite its lack of recent growth, has been toiling away in the fields of machine learning and AI long before they became fashionable.
Despite these positive developments, I decided to part ways with my shares. Analysts predict a return to single-digit revenue growth, but profit targets have been steadily declining. I initially invested in Baidu for international diversification, but there is no shortage of companies overseas that are growing at a faster rate. And so, I sold, seeking opportunities elsewhere, in the endless pursuit of value and prosperity. It is a truth known to all seasoned investors: the world is vast, and the possibilities are limitless.
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2026-03-11 18:14