Name that company

Based in France and with some $122 billion in annual revenues, I’m one of the world’s largest corporations. I didn’t exist in 1980, but today I’m a leader in financial protection, with 50 million clients and 112,000 employees. I’m the result of a series of mergers involving French regional mutual insurance companies. I offer individuals and businesses a range of insurance, protection, savings, retirement and estate planning products and services. I pay out 40 percent to 50 percent of my adjusted earnings as a dividend. My name is a short palindrome, and X marks the spot in the middle. Who am I?

Last week’s question and answer

I began in the late 1800s as a U.S. branch of the German company Schering. Today, based in New Jersey, I’m an American health care and pharmaceutical company. I employ some 30,000 people globally and rake in more than $8 billion in sales annually. My brands include Dr. Scholl, Tinactin, Afrin, Chlor-Trimetron, Correctol, Drixoral, Coppertone, Bain de Soleil, Claritin, Cipro, Coricidin, Levitra, Lotrimin and Remicade. Animal health products are a major interest of mine, especially after I bought the animal health operations of Mallinckrodt Inc. in 1997. Who am I?

(Answer: Schering-Plough)

Know the answer to this week’s question? Send it to us with Foolish Trivia on the top and you’ll be entered into a drawing for a nifty prize! The address is Motley Fool, Box 19529, Alexandria, Va. 22320-0529. Send questions for Ask the Fool, Dumbest (or Smartest) Investments (up to 100 words), and your Trivia entries to Fool@fool.com.

Scotts profits wilt

On the surface, things look pretty good for Scotts Miracle-Gro (NYSE: SMG), which reported an 18 percent increase in revenues for the third quarter. Sales in North America shot up 12 percent year over year. Scotts LawnService reported a 20 percent sales increase over last quarter.

Yet dig down a bit, and you may find some grubs eating the roots. Much of the revenues Scotts recorded were the result of its acquisition of Smith & Hawken, a high-end garden supplies retailer Scotts picked up last October.

The commissions it receives from Roundup herbicides, which it markets for Monsanto, were up only 3 percent. International sales rose just 4 percent over last year, but considering the effects of currency exchange rates, sales were flat. Profit margins declined.

A major concern is in so-called extraordinary or “one-time” charges (such as restructuring expenses) that reduced Scotts’ profits from $117 million down to just $88 million, a 12 percent decrease from the same period last year. A look at financial statements for the past few years reveals that restructuring seems to have become a regular part of Scotts’ business. Indeed, it recently announced another “strategic improvement plan,” hiring restructuring consultant Booz Allen Hamilton to come up with new cost-savings plans.

Still, Scotts’ performance this quarter wasn’t bad. The sales growth was welcome and the company will start paying a $0.25 quarterly dividend.

Bad financing

In February 2004, I purchased a Sony television from a retailer and was offered a “no money down, no interest through June 2005” deal from Sony Financial. How could I go wrong, I reasoned, and promptly invested the money I would have spent on the TV in the stock of United Rentals Inc. It had just come out with bad earnings results, the stock price had dropped, and I considered it undervalued at $16.92 per share. In June 2005, I sold the stock, which had risen to $20.13 per share, at a net profit to me of more than $400. I immediately paid off the television in full, only to receive a bill for $843. I was told that I had missed the payoff date and all the interest was back-billed at a hefty 21.99 percent. My net loss: $443. The moral: Consumers, beware of financing deals that sound too good to be true! P.S. The television is still working great! – Tom Ganley, Colchester, Conn.

The Fool Responds: At least your stock increased in value – otherwise you’d have been hit with a double-whammy. Thanks for the lesson.

Look to the future

Q: I own stock in six companies. Two have lost value, one is about the same after 10 years, and three have done well. I now wish to finance my son’s college tuition. Which stocks do I sell first? – M.E., Mount Holly, N.J.

A: First, forget how the stocks have done in the past. What matters is each company’s future. Try ranking the firms by how much confidence you have in their health and growth prospects. Sell the ones in which you have the least faith. Your money should always be concentrated on your best ideas.

How can I tell if I have too many of my portfolio’s shares in one company’s stock? – S.B., Baton Rouge, La.

First, think in terms of total value, not number of shares. You might have 1,000 shares of one stock, worth $5,000, and 200 shares of another stock, worth $8,000. Focus on the percentage of your portfolio that each stock represents.

If one of your holdings represents 50 percent of your entire portfolio, for example, that’s too much risk for most people. If anything happens to that one holding, your portfolio will take a big hit. If you hold too many stocks, though, and your biggest holding amounts to just 3 percent of your portfolio, that’s not ideal, either. If that stock doubles or triples, its overall effect will be small.

For most people, eight to 15 stocks is a good number of holdings. You want some diversification, but you don’t want more companies than you can follow. When one holding grows to become too big a chunk of your portfolio – perhaps 15 percent to 30 percent – consider selling off some of it.

It’s grim but important

It’s smart to plan for your death and the deaths of loved ones now – when you’re not engulfed by grief. Here are some tips:

¢ Record everyone’s wishes. If you know that Grandpa wants a simple pine casket, you won’t have to guess about it later, perhaps opting for something expensive just to be safe.

¢ Consider inexpensive caskets. Bodies will decay in any casket, and casket costs vary widely, from several hundred to many thousands of dollars. (A $3,500 casket may have cost the funeral home just $700 wholesale.)

¢ You don’t always have to buy a casket from the funeral home. You can buy a good one from a discount vendor and have it delivered to the funeral home – which is likely required to accept it. Even Costco sells caskets now.

¢ Embalming usually isn’t required, except for open caskets. Someone might try to talk you into paying for it, though, for hundreds of dollars.

¢ Beware of the recommended rubber gasket (aka “protective sealer”) that, according to some sources, costs just dollars to make but is sold for several hundred dollars. It’s pitched as protecting the body from decay, but nothing can stop decay.

¢ Think twice about grave liners and vaults. Their “protection” often doesn’t last long.

¢ Don’t tell funeral directors more than you need to, such as the deceased’s net worth or insurance coverage.

¢ Consider cremation, which is usually much cheaper. (Remember organ donation, too.)

¢ Take a non-grieving friend with you when you talk to death-care providers.

¢ You can save money by employing a personal touch. You can build and decorate a casket yourself, instead of buying one. You needn’t use a funeral home’s viewing room, either – a loved one can “lie in honor” in a home, community hall or church.

Get more information and guidance at www.funerals.org and www.ftc.gov/bcp/conline/pubs/services/funeral.pdf, and from helpful books such as “When Death Occurs” by John M. Reigle (Consumer Advocate Press, $20) and “The Profits of Death” by Darryl Roberts (Five Star, $18).