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Monthly Stock Special

The featured DRIP is *Chubb Limited (CB).

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Here is a capsule review of our featured stock, provided by Mario Medina.

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Company Information:

Chubb Limited is a global provider of insurance products covering property and casualty, accident and health, reinsurance, and life insurance. Chubb operates in 54 countries and is the world’s largest publicly traded property and casualty insurer. The company provides commercial and personal property and casualty insurance, personal accident and supplemental health insurance, reinsurance and life insurance. The current company arose when ACE Limited acquired Chubb in 2016, and then adopted the Chubb name. Its core operating insurance companies are rated "AA" (Very Strong) for financial strength by Standard & Poor’s and "A++" (Superior) by A. M. Best, with stable outlooks from both agencies. Its current total market capitalization of $67.5 billion makes CB a large capitalization stock (a large-cap stock has a market capitalization value of more than $10 billion) with a long history of consistent earnings growth and dividend payments.

It is considered a solid and well-diversified business with a durable competitive advantage over its rivals, which also enjoys a solid management and corporate culture. According to Yahoo! Finance, consensus estimates call for the company to earn about $6.91 per share this year, and to go to about $11.44 per share next year. Chubb has paid dividends to investors since 1984, and has increased its payments for twenty-eight consecutive years. During the past ten years, it has increased its dividends at an annualized average rate of 11.15%, with its quarterly payment of $0.78 currently providing a trailing twelve-month yield of 2.01%.

The value of dividends reinvestment: A hypothetical investment in the company has grown cumulatively (including dividends reinvested) 1,859.15% during the past twenty-five years. The same investment has grown only 1,084.00% in the same period of time, excluding dividends. During the same period, a hypothetical investment in the S&P 500® index (thru the Vanguard 500 Index Fund (VFIAX) has grown cumulatively 872.66%, including dividends reinvested. According to the data and calculations of the financial website (don’t quit your day job), a periodic monthly investment of $100 in CB for the past twenty-five years would has grown to $192,288, including dividends reinvested. The company still has room for significant dividend payments and dividend increases in the coming years, since its current Dividend Payout Ratio (DPR), which is its dividend payments as a percentage of its earnings, is just 61%. Its average DPR during the past five years is 39%.

Its current Price to Forward Earnings ratio (P/E Forward--a measure of valuation based on projected Earnings) is 13.59. Its Price to Book ratio (P/Book) of 1.23 is 58.86% below the US Market Index. Its Price to Sales ratio (P/Sales) of 2.00 is 19.03% below the Market, and its Price to Cash Flow (P/Cash Flow) of 8.06 is 49.97% below the index. Technically (from the chart’s perspective) CB also looks attractive, trading 23.3% below its all-time high), while it is forming a long double-bottom base pattern, between $168 and $87 approximately, in which $87 is acting as a strong technical support level.

The actively managed mutual funds American Funds Washington Mutual and Vanguard Dividend Growth are major shareholders of CB, holding 2.2% and 1.7% of its shares respectively. CB’s main competitors are Berkshire Hathaway Inc. (BRK.A) and American International Group Inc. (AIG). Chubb’s 5-year Beta (a measure of the volatility or systematic risk in comparison to the market as a whole as evidenced by the S&P 500® Index) is 0.67, so the stock is 33% less volatile than the Market.

Best and worst years during the past 25 years: Its best year was 2000, in which CB returned, excluding dividends, 154.31%. On the flip side, its worst year was 1999, when the stock declined 51.5%, excluding dividends. CB’s Dividend Reinvestment Plan charges no fees for cash investing, dividend reinvestment, safekeeping, automatic investment or termination of the Plan. With the stock being fundamental and technically attractive, this company might be an appropriate holding for investors who wish to build a holding over the long term.

Disclosure: Mario Medina has no position in Chubb Limited and has no plans to initiate any position in the immediate future. The author wrote the article himself and it expresses his own opinions. The author has no business relationship with CB and this article is not intended as a recommendation to invest as the information published does not take into account any subscriber's personal finances, goals or risk tolerance. Accordingly, you should be aware of all the risks associated with any financial investment and should consult an independent financial advisor for any personal investment advice. Past results and risks illustrated in the article are for reference and educational purpose only and do not guarantee future performance.

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Mario Medina Personal and Professional background:

Born in Cuba and graduated in Architecture from the University of Havana, Mario Medina is editor and writer of the weekly online investment newsletter El Boletín, and senior analyst for Julie Stav, Inc. Through seminars and conferences live and online, DVDs, investment e-books, articles in his blog and financial columns (on, and, videos and Podcasts, Mario teaches people inside and outside the United States. The point that differentiates Mario in his teachings, is the simplicity and softness of the language, teaching beginners, the same way he wanted to be educated when starting in the world of personal finances and investments.

Mario provides investment guidance in financial segments of Hispanic television and radio, and has had his own radio shows on those topics at Univision Radio Network, also participating in Tu Dinero, Julie Stav’s financial shows and Podcast series ( and

Analyzing the status of the market and its indexes, examining leading companies, sectors and industries, and evaluating the performance of Julie Stav’s Platinum List of Companies, his popular online Daily Market Report allows thousands of people from across the country to follow the situation of the financial world and get the essential information they need to make the best decisions about their own investments.

Today, Mario provides independent fundamental and technical analysis for the mutual fund MoneyPaper 63 (DRIPX), which is the only fund that focuses solely in companies that offer small investors Dividend Re-investment Plans. He is also a regular contributor to

Today, those who read the articles written by Mario Medina, or those who daily follow his Market Report, listen to his segments, watch his videos, or attend his seminars, could not imagine that a little over a decade ago its author knew nothing about investments or the stock market. It has been a long, arduous road for the young man newly arrived to the US with empty pockets, a suitcase full of dreams, and whose first savings came from collecting empty soda cans and recycling scrap yard. After discovering the world of finance through books and radio programs, and after years of study and sacrifice, Mario Medina now advises thousands of Hispanics on how and when to buy or sell in the stock market in order to obtain the best returns and minimize their losses.

What was the secret that allowed Mario to develop those early, small investments? "I think the key is to save and invest on a regular basis, with clearly defined long-term, diversified goals," he says. "To do so, each person must determine his o her risk tolerance level ... I do not feel comfortable risking as much as other people, and in turn many risk more than me. It is essential to know how far one can get without trying to beat the stock market every day.”

Through his regular segments, articles and analysis, Mario wants to offer everyone his successful strategies so that anyone can make the most of their work, their savings and their investments, and realize their dreams of economic prosperity. Mario Medina’s own dream is to help those interested in managing their money by knowing the risks and investing directly in the very best, teaching them the necessary steps to succeed in the stock market and other investments, participating in it directly and without brokers, so they can manage their money more efficiently and get better returns without paying more fees.

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