Dividend income - December 2015

I love to write about dividend income.

December was a great month for me. Another alltime high! It's unbelievable, but reaching the first $100+ month of dividend income seems only months away! This is not a goal by itself, but after this point, the income seems to be substantial.

Dividend income

KO $13.86
JNJ $12.00
TGT $15.68
AFL $7.41
MCD $9.35
CVX $10.70
TROW $6.24
QCOM $6.72
WFC $4.50

Total December: $87.28 (pre tax)

Comparison with last year (gross)
December 2014: $0.58
December 2015: $87.28

This is a 15048% increase..
Of course there is a reason for this, as I did not invest that much in 2015.
My (Dutch) broker used to pay the dividends at the ex-dividend date. This means I received the December dividends in November, last year. After they switched to another clearing partner for US stocks, this changed. Unfortunately I am now paid, at the same time everybody else gets paid.

My goal was to receive $300 net dividends in 2015. This goal is totally crushed! Total net dividends received in 2015: $424.36. I am very happy about this. Let's set a more challenging goal for 2016.

How was your December?
Thanks for reading!

Recent sell - KMI

Unfortunately KMI cut their dividend by 75%, earlier this week.
This was a reason for me to sell all my shares, yesterday.

Let's see what happened during my time as a shareholder of KMI.

07/24/15 - bought 19 shares at $34.79 for $661.01
08/14/15 - Received $7.91 in dividends
11/13/15 - Received $8.24 in dividends
12/09/15 - Sold 19 shares at $15.91 for $302.29
-------------------------------------------------------------------------
Net loss: $342.57

This transaction is my first loss since I started this DGI strategy, almost 1,5 year ago.

To learn a lesson..
To me, it is important to learn something from this loss.
However, I'm having troubles determining what I could have done differently, in order to prevent this loss. The easy answer: you shouldn't have bought KMI. With today's knowledge, that's absolutely right, but I didn't have today's knowledge back in July.

Was it the company's high debt ratio that should have raised the alarm? Was it bad to buy stocks in KMI, when all oil related companies suffered major losses in stock prices? Are commodities in common bad for a long term growth portfolio?

Anyone with thoughts on this?

One thing remains very clear: a long dividend streak does not provide any guarrantees!

Thanks for reading!

Dividend income & dividend raise November 2015

November was an amazing month. For the 5th (!) time this year, the dividend income has risen to an all time high. Loving the power of compounding over here!

T - $23.03
PG - $8.62
OHI - $18.48
KMI - $9.69
CAT - $9.24
WFC - $4.50

Total November (gross): $73.56

Total dividends received in 2015: $350.17 (net)

My 2015 goal for dividends is to receive a net total of $300 of them.
This obviously means the goal is reached! I have to set a more ambitious goal for next year.
I'm very excited with this progress to be honest.

Comparison with last year
November 2014: $55.02
November 2015: $73.56

This is a 33.70% YoY increase. Where can I sign up for more of those please?!

Dividend raises

On November 10th, MCD increased their quarterly dividend from $0.85 to $0.89.
This is a 4.71% increase. Due to this change, my YOC is now at 3.76%.

How was your november?

Thanks for reading.

Recent buys - November 2015

Due to me buying my first appartment, I don't have as much time to blog as I would like.
However, I do want to update you guys about a few recent buys I did a couple weeks ago, without going in depth.

Of course I'm very excited about this appartment and I can't wait to tell you much more, but it still is not finalized. So I have to be a little bit more patient for now.

Let's get back to business!

Wal-mart & Co. (WMT)
Buy 13 shares @ $58.29 at 10/26/2015

Can't go wrong with this, right?

Qualcomm Inc. (QCOM)
Buy 1 share @ $56.73 at 11/05/2015

I had some money left in my account and I wanted it to work for me, that's why I bought another share of QCOM. It turned out it was going to drop a bit more, but that doesn't really matter if you're expecting it to hold for at least another 25 years right?

My portfolio page has been updated to reflect these changes.

What do you think of these?

Thanks for reading!

Dividend Income & dividend raises - October 2015

Dividend income
October was not a very exciting month, in terms of dividend income.
2 of the 16 companies I am currently invested in, paid me their dividends.

KO - $13.86
GE - $9.20
Total October (gross): $23.06
Total dividends received in 2015: $287.65 (net)

My 2015 goal for dividends is to receive a net total of $300 of them.
With only $13 to go, I think it it safe to say I will be reaching this goal.
That makes me a happy person, especially if you compare this to what my local bank would have paid me.

If we compare this months result to last years, we were able to create a small increase.

October 2014: $22.08
October 2015: $23.06

This is a 4.44% increase.
It's not amazing, but with the power of compounding behind me, I'm still happy with this result!

Dividend increases
While it was a calm month on the dividend income, we cannot say this about dividend raises.

On October 14th, OHI increased their dividend from $0.55 to $0.56.
This is a 1.8% increase. Due to this change, my YOC is now at a very nice 6.31%.

On October 21st, KMI increased their dividend from $0.49 to $0.51.
This is a 4.1% increase. Due to this change, my YOC is now at a nice 5.86%.

On October 27th, AFL increased their dividend from $0.39 to $0.41.
This is a 5.1% increase. Due to this change, my YOC is now at 2.6%.

How was your October?

Thanks for reading.

Recent buy - October 2015

A few weeks ago, I put some fresh capital to work!

Unfortunately the amount of this fresh capital was not as large as it should have been, but that's because we spent some time in the city of London. It's a great place to be, although it's not very cheap.

We did the usual sightseeing and went to one of the most succesful musicals ever: Les Miserable.
A very exciting experience! We had a great time.

In the midst of all this, I'm in the process of buying my first apartment!
More about that soon, as it is not yet finalized.

Let's get back to business!

Wells Fargo & co (WFC)
Buy 12 shares @ $51.32 at 9/30/2015

Wells Fargo is one of the biggest banks in the US. Their total assets have a value of $1.69 trillion dollars. They offer a wide variety of financial services like personal banking, insurances, mortgages, wealth management and investing services.

During the Great Recession the entire financial sector took a big hit and WFC was no exception. The stock went from $39 to $8 in a matter of months.

WFC stock price during the Great Recession (source: Google Finance)

As we know now, they have managed to recover pretty well from that.

WFC stock price after 2008 (source: Google Finance)

The impact of the recession is also shown in the graph below, which shows the dividend payouts of WFC from 2002 until now.

This graph leads to the following DGR numbers.

DGR-1, 17.4%
DGR-3, 41.2%
DGR-5, 22.5%
DGR-10, 3.8%

With an earnings per share of $4.11 and a very small payout ratio of 36.54%, there should be more than enough room for WFC to grow their business and their dividends to the $0.52 per quarter they once paid. The low forward P/E of 12.49 is just another metric of showing this potential.

I can definitely see why Warren Buffet has so many of shares of this great company.

What do you think of this purchase?

Thanks for reading!

Why did I start this journey?

It has been a great journey so far!

Just 15 months ago, I did not know anything about DGI.
Of course I knew about stocks, but I thought the only way to make money on the market is to know which stocks will be at a higher price tomorrow than they are today. However, I did not find myself capable enough to find such stocks. As I have learned recently, this is not because I am stupid, but because nobody in the entire world knows.

Fortunately I came across DGI. This strategy enables you to make a profit without relying on rising stock prices, basically without doing anything. It opened my eyes and I really have to thank bloggers like Dividend Mantra, Captain Dividend, DivHut, DivGro and Roadmap to Retire, amongst many others for this insight!

Just knowing about the strategy was not enough reason for me to start the journey.
At the time I was very disappointed in all the major banks in The Netherlands. The average interest you would get at a standard savings account was 1.4% to 1.2%. With inflation taken into account, I was just losing money, instead of gaining some.

This was how it all started.
My primary goal was to beat the 1.25% interest rate I received in June 2014.

So, let's see what happened with the interest rate after June 2014.

Interest rate of a standard internet savings account at the largest bank of The Netherlands.

Ouch! Down 0.45% to 0.80% at this moment.

What would the bank have net me in interest?
In order to determine what the bank would have paid me in interest if I kept my money at the savings account, I calculated the balance of each month and added the according interest rate to it.
The bank would have paid me a total of €108.80 in interest over the past 14 months.

The power of DGI
Meanwhile I invested in 14 solid companies. From June 2014 to September 2015, they paid me a total of $484.04 in dividends. Unfortunately we have to deduct 15% because of tax, meaning a net total of $411.43 was received. This is the equivalent of €367.27.

Kaboom! The blue chip companies I invested in, paid me 3.38 times as much as the bank would have done. Amazing.. I would not have thought that this simple strategy could be this successful.

Keep at it and I'm sure you will beat your local bank as well!

Thanks for reading.

Dividend Income - September 2015

September was an amazing month for me.
Another record is broken! The power of compounding is starting to show off.

Dividend income

CVX $10.70
TGT $15.68
JNJ $12.00
AFL $7.41
MCD $9.35
QCOM $6.24
TROW $6.24

Total September: $67.62 (pre tax)

Comparison with last year (gross)
September 2014: $13.08
September 2015: $67.62

This is a 517% increase!
Let's see if we are able to maintain that percentage in 2016.. ;-)

In order to achieve the annual $300 of net dividends, I should have received $225 by now.
The total net dividends of 2015 are currently at $268.05, so we are ahead of our goal. Looks like I could set a goal for >$100 in one month, somewhere in 2016. That would be a very appealing milestone to look forward to!

How was your September?
Thanks for reading!

Recent buy - September 2015

Looking at my current holdings, we see a reasonable balanced breakdown of sectors I'm invested in.

Those who are familiar with the sectors used in David Fish' CCC list, might miss 2 sectors.
You are right! I am not yet invested in any company related to the Materials or Utilities sector.

Keeping my portfolio diversified is one of my main goals. This is why I was specifically looking for opportunities in these sectors. However, I did not find many great looking quality stocks here. During my research I came across ALB, SYT and CMP as potential purchases, but they didn't make the cut for different reasons. If theres anyone who might have a good suggestion, please let me know down below.

The next best thing was adding a position to either Information Tech, Energy or Industry.
This is where I found Caterpillar.

Caterpillar Inc (CAT)
Buy 12 shares @ $73.75 at 9/8/2015

Caterpillar is a huge company that manufactures mining and heavy industrial equipment. It is founded in 1930 and has grown to be the largest company in their business.

Most of their segments, like mining, energy & transportation and resource industries are depended on natural resources. This is why their profits are not steadily growing, but making pretty big swings instead. In Q2 2015 they suffered a 13% decline in revenues, compared to Q2 2014, as indicated by the comparison below.

Source: CAT Q2 2015 earnings release

Growth
The company has been raising their dividends for 22 consecutive years.

Their growth over the years has been amazing. As with many other companies, I wish I knew about this company about 25 years ago. If you would have invested $1,000 in CAT at 8/31/1990, it would have been worth $13,823 right now. (source)
Of course, this is just hypothetical, as people probably did not have the ability to for see the future, back in 1990.

However, recent growth numbers are still double digits.

DGR-1, 11.1%
DGR-3, 13.0%
DGR-5, 9.1%

Yield & competitors
The yield of 4.03% is well above the sector average of 2.06% (all industry contenders).

Valuation
With a payout ratio of almost 53%, the payout of future dividends should be maintainable.
With a forward P/E of just 13.11, it sure looks like we get some value for money.

The Coca Cola Company (KO)
Buy 1 share @ $38.76 at 9/8/2015

This is an addition to my existing holding, because I had a little bit of money left in my account.
KO goes ex dividend tomorrow.

What do you think of these purchases?

Thanks for reading!

Dividend Income - August 2015

August was a great month. As a matter of fact, it was my best month ever!
This is very exciting to me. I did not expect to have $50+ months within just 14 months.
I'm loving this and I hope to break records many more times!

It was the first time I received dividends from OHI (wow!) & KMI.

T - $23.03
PG - $8.62
OHI - $18.15
KMI - $9.20

Total August (gross): $59.11

Total dividends received in 2015: $210.57 (net)

My 2015 goal for dividends is to receive a net total of $300 of them.
Currently, I received an average of $26.32 per month.

If this continues, we are passing the goal!
Thanks to August, our expectation changed from failing to passing. Great news!

Comparison with last year
July 2014: $32.79
July 2015: $59.11

This is a 80.26% increase.
This is where the true power of compounding and steadily investing with fresh capital kicks in!
I'm very happy to see this is possible, even with a small income.

How was your August?

Thanks for reading.

Dividend income - July 2015

July was an OK month.
2 of the 13 companies I am currently invested in, paid me their dividends.

It was the first time I received dividends from GE.

KO - $13.53
GE - $9.20
Total July (gross): $22.73
Total dividends received in 2015: $160.33 (net)

My 2015 goal for dividends is to receive a net total of $300 of them.
We are 7 months deep in the year, meaning I averaged $22.90 per month.

If this continues, we are failing the goal!
However, August & December should be great months, so I still have confidence I could reach the goal.

The most interesting part to me, is the ability to start comparing to the result of last year.
I have been looking forward to this!

July 2014: $22.08
July 2015: $22.73

This is a 2.94% increase.
Last year my broker paid AT&T dividends in July. That's why the difference is not too big.
Looking forward to August!

How was your July?

Thanks for reading.

Dividend raises - July 2015

The bread and butter of the DGI strategy are the raises you receive over time.

Dividends itself are a great way to earn some money, but increasing dividends are amazing.
Especially if you consider the effort you have to put in, to get those raises: none!

My blog is only 13 months old and I have had the pleasure of receiving several raises.
This month is no exception.

Target Corp (TGT)
On June 9th, TGT increased their quarterly dividend from $0.52 to $0.56.
This is a 7.69% increase! I wish my employer would give me the same..

This increases my YOC from 3.55% to 3.82%.

Kinder Morgan Inc (KMI)
On July 15th, KMI increased their quarterly dividend from $0.48 to $0.49.
This is a 1.85% increase. One penny doesn't seem to be much, but every penny counts!

This increases my YOC from 5.52% to 5.63%.

Omega Healthcare Inc (OHI)
Also on July 15th, OHI declared a $0.55 dividend. This is also a 1.85% increase.

This increases my YOC from 6.09% to 6.20%.

Pretty nice YOC's if you'd ask me. Definitely happy with that.

Did you receive any raises recently?

Thanks for reading!

Recent buy - July 2015 (2)

Recently, I put some fresh capital to work!

Kinder Morgan Inc.
Buy 19 shares @ $34.79 at 7/25/2015

Kinder Morgan Inc is the fourth largest energy company in the US.
They transport and store petroleum on a very large scale.

From an investor point of view, this is one of the few non-Aristocrats I added to the portfolio.
Their current dividend increasing streak is only 4 years, but according to David Fish' CCC list, they are a former Contender.

We have seen recent declines in all Energy related stocks.
CVX, down 16% since I bought it, last September.
HP, down 45% in the same period.
XOM, down 20%.

This does not worry me at all.
We cannot time the market and we have to treat it as opportunities to average down.
I will definitely try to do so with CVX, if their decline continues.

On the bright side: my yield on cost on this KMI purchase starts at an amazing 5.52%.
Theres more good news, as KMI could transfer and store other products as well. For example natural gas. This should maintain a very nice income stream in the future.

DGR-1, 9%
DGR-3, 31.9%
DGR-5, n/a

The yield of 5.00% is below the sector average of 5.45%, but I'd take a 5% yield any day.

What do you think of this purchase?

Thanks for reading!

Recent buy - July 2015

Recently, I put some fresh capital to work!
Here's a short breakdown of the purchases I made.

T. RowePrice (TROW)
Buy 12 shares @ $76.44 at 7/6/2015

T. RowePrice is a global investment management firm.
They manage US and international stocks, mutual funds, blended assets and bonds.

Main reason for buying this stock is their strong growth over the last decade.
The Great Recession obviously has hurt the stock price, but their funamentals never changed.

Despite the recession, even the 10-year growth numbers are double digits!
DGR-1, 15.8%
DGR-3, 12.4%
DGR-5, 12.0%
DGR-10, 16.6%

These numbers beat 20 of the 21 Financials in the CCC Aristocrat list. Pretty amazing if you'd ask me.

The yield of 2.68% is below the sector average of 3.16%, but with these growth numbers, I'm not worried at all.

Looking at the valuation of TROW, the numbers are looking very nice.
EPS - $4.46
Payout ratio - 46.64%
P/E - 17.43

This high EPS combined with a low payout ratio and a low P/E leads me to believe that the stock is currently undervalued. Theres definitely enough room for future growth. I'm new to valuating stocks, so I don't know what a fair price would be, but I am studying this subject.

Qualcomm (QCOM)
Buy 13 shares @ $62.81 at 7/6/2015

If you own a non Apple smartphone, the heart of your phone is probably manufactured by QCOM.
Their Snapdragon processor is widely used in the current generation of smartphones.

Qualcomm is my first holding in the Information Tech sector.
I'm not a huge fan of Facebook, because there is no product to sell. As with MySpace, Facebook could be worth nothing in a matter of a couple of years. Same goes for Twitter.
Apple seems to be overvalued to me. Will we keep buying an iPhone every 2 years until they release iPhone 27? I'm not sure.

I do think smartphones and other smart products are here to stay, so buying QCOM makes perfectly sense, despite not liking Apple so much from an investor point of view.

As with TROW, QCOM has some impressive growth numbers.
DGR-1, 23.8%
DGR-3, 24.5%
DGR-5, 19.2%
DGR-10, 21.7%

These numbers beat all the other 17 stocks in this sector for the Contenders section!
This amazing deal comes with a 3.07% dividend yield, which is above average.

EPS - $4.22
Payout ratio - 45.50%
P/E - 14.84

With these numbers, there should be more than enough capital to sustain current dividend payouts as well as a lot of money to be used to growth the relative new company. They have been raising their dividends for 13 consecutive years.

AT&T (T)
Buy 1 share @ $35.57 at 7/6/2015

After buying TROW and QCOM I had about $40 left in my account.
My broker does not support buying fractial shares yet, so I added 1 share of AT&T to my portfolio, as they went ex-dividend at the 8th of July.

What do you think of these purchases?

Thanks for reading!

Dividend income - June 2015

June was a great month for me!

Dividend income

JNJ $12.00
TGT $14.56
AFL $7.41
MCD $9.35
CVX $10.70

Total June: $54.02 (pre 15% tax)

In order to achieve the annual $300 of net dividends, I should have received $150 by now.
The total net dividends of 2015 are currently at $141.01, so I'm a little bit behind, but I think it will work out just fine!

Being behind schedule gives me motivation to research new investment opportunities!

Dividend raise

Exactly 1 year ago, TGT was in big problems. The stock has had a huge downfall due to several problems. This gave me a very appealing entry point, as marked at the graph below.

TGT graph which indicates my point of entry

After that, things have gone very well for TGT. The stock value has risen from $58 to over $80 now. This makes TGT by far my best performing stock. Current price is +38%. Of course I'm keeping this winner!

The 7.69% dividend increase they announced recently, is just another example why this is a great stock to have.

TGT raised their annual dividend from $2.08 to $2.24.

Excited about next month

Getting into July next month will be very exciting for me.
Last year in July, my first dividends ever, were deposited into my account.
This means I'm able to start comparing dividend results to last year, which is something I have been looking forward to.

Thanks for reading!

Free cake for everybody!

Today, we celebrate my very first blogiversary!

Picture and cake by Animated Cupcakes at Flickr

Right from the start, I felt a very warm welcome from the entire community. This helped me a lot. Not only because of the solid advices you all provide, but also through the content so many of you create.

Please take a piece of this beautiful cake. Some of you might recognize a logo in that. This is not a coincidence. Looking back, Target (TGT) has been my best holding, by far.

Before we get into that, let's see what the relative new blog has brought me, in the past 12 months.

Blog stats
31 posts were published, roughly 3 per month.
These posts were complemented by 160 comments! That's much more than I would have anticipated. Thank you all very much for the participation. It's much appreciated. The blog has been visited 11.476 times. Wow!
The vast majority of visitors is an American. Not uncommon for an English blog about US Dividend Aristocrats I would say.

I couldn't thank all of you personally, but I do like to mention Dividend Yield, because of his continued support through Twitter, as well as Captain Dividend for adding me to the blogroll of his very succesful blog.

Investing stats
This adventure started by purchasing 4 major Dividend Aristocrats for a total of $6.666.
After these purchases I added money to my brokerage account on a monthly basis. This resulted in a portfolio, which has 10 holdings, with a cost basis of $13.214. Today, the value of this portfolio is at $13.844. This is a 4.76% increase. Dividends are excluded from this.
Should we add the $264.80 net dividends received (June 2014 to June 2015), the total return is a decent 6.77%.

Snapshot of portfolio at 6/25/15

Overall, I'm very pleased with the results. The price fluctuation don't worry me at all. It might provide me with a chance to average down in the future.

Main reason for starting this adventure is because of disappointing interest rates banks give us nowadays. Most major banks in The Netherlands decreased the interest rate to approxiamately 0.9%. At least for the last 12 months, this DGI strategy has paid me 7.5 times as much!
Even if we would ignore growth, just the dividends paid me more than the bank would have paid me in interest. Isn't that amazing?

Looking forward

Focus on growth
To start the snowball effect as soon as possible, I tried to buy some high yielding, blue chip stocks. Most high yielding companies, don't have very strong growth numbers. This is indicated by the table below. From this point forward I will shift my focus to growth. Of course, yield remains important as well, but I feel like my average growth should be a double digit number.

Getting into p2p lending
I'm exploring the posibilities to get into p2p lending. This should be a nice addition to the passive income stream. At this point, I'm not sure if I would have enough funds to do this efficiently, because I don't want to cut the amount I put in my brokerage account each months. The snowball has to grow!

Concerns
After all this good news, I'd like to share some concerns as well.

Euro vs Dollar
First, there is this Euro vs Dollar issue.

Amount of dollars we'd get for €1

Looking at the chart, I pulled off these numbers:
June 25, 2014: €1 = $1.36
June 24, 2015: €1 = $1.11
That's a 19% decline and despite the recent upswing, I don't think all troubles are over.

As with price fluctuation I think I shouldn't worry too much about this and let Mr. Market do his job. If you look at it from an optimistic view you could say it's good I'm invested in US companies instead of EU companies with this strong dollar, right? What are your thoughts on this?

Multiple broker accounts to decrease risk?
Next, theres some concern about my broker. I'm with the cheapest broker in The Netherlands. It has been operational for about 3 years now. The fees are really low. Probably around $1 for a $1000 purchase. Explaining their entire earnings model would be something we could discuss in a seperate post, but for now I'm starting to feel a little bit anxious adding more than the current $15k to the account.
Do you trust your broker with all your (investing) money?

English not primary language
Although I do want to write more than 31 posts during this next year, it takes a lot of effort to write posts like these. And even then, I'm pretty sure these posts are full with textual errors. Please ignore them or write me a message to correct me, especially if you see multiple occurrences of the same error. I won't be offended.

Hopefully you all keep joining me on my journey to FI! :-)

Thanks for reading this wall of text.

Recent buy - June 2015

Omega Healthcare Investors (OHI)
Buy: 33 shares @ 35.49 at 6/4/2015

Recently, many investors picked up some shares of OHI.
Although this should not mean you should buy it as well, it did trigger me to dig some deeper.

Omega Healthcare Investors is a Real Estate Investment Trust, a REIT.
While reading DGI blogs I have seen the term REIT regularly, but I had no idea what it was. The only things I knew were: high yield, high payout ratio and pretty risky if you compare it to regular Dividend Aristocrats which produce tangable products, like MCD, JNJ & KO.

Fortunately I came across the official website about REITs, www.reit.com. They provided a very solid, basic explanation. If you're not familiar with REITs, I suggest you read this website carefully.

After reading that, I concluded REITs could be a great addition to my portfolio, but I don't want too many of them. It is very good for diversification though. So, let's get into the interesting parameters of this REIT.

DGI stats

The attrictiveness of the stock was immediately clear when I took a look at the amazing 6.00% yield. They usually raise their dividends every quarter and they have been doing so for the last 11 quarters. With several raises per year, the snowball grows even faster!

Talking about growth, their DGR numbers are looking very good as well. The DGR-3 is 9.2% and the DGR-5 is even at 11.0%. Those are fantastic numbers if you combine them with the high yield.

Because REITs usually have a huge amount of depreciation on their statement, metrics like P/E and EPS are not very useful. Instead, we determine the valuation of a REIT by their price per funds from operations, or P/FFO. The lower the better. The P/FFO of OHI is 12.45, which is a very attractive value.

Last, the stock value took a hit over the last couple of months. The decline from the 52-week high value of $45.46 (which occurred in January) down to my entry point of $35.49 is roughly 22%. As you probably know, price is just a number, but this is another valid reason for current shareholders to average down.

Looking forward

Looking forward I think there is a lot of potential growth for the Healthcare sector.
Technically REITs are financial products, but as OHI invests in Healthcare facilities I think their profit highly depends on that sector as well.

I think this picture says it all.

Disclosure: Long MCD, JNJ, KO & OHI

Thanks for reading!

Dividend income - May 2015

May was a quite month.
It was just AT&T who paid me their dividends, but it sure is a nice amount.

AT&T's yield is amongst the highest dividend yielding Aristocrats with their amazing 5.43%.
I'm still very happy to have them in my portfolio.

T $22.56

Total dividends received in 2015: $95.09

As we are closing the first half of 2015 in just about a month, it will be tough to reach my $300 annual dividend goal, but I'm still positive. We have to have confidence in the snowball to grow fast enough!

Thanks for reading.

Evaluation of the portfolio

The first anniversary of this blog is just a couple of weeks away!
In the past 11 months I've bought 9 high quality stocks.

During my first year as a Dividend Growth Investor, I tried to focus on dividend yield. As this yield generates money to buy more stocks. However, I'm here for the long run. This means growth is a huge factor in growing the snowball.

That's why I created the table below to evaluate the balance between yield and growth.
It is available at the second tab of my portfolio page.

As you can see, most of my high yield (3%+) stocks, don't have extraordinary growth numbers. It would be amazing if I could average the growth numbers to double digits, while maintaining the 3% yield as well.

While I don't think aiming for double digit growth should be a goal itself, I do think it would be a good idea to focus on growth during my second year of investing.

To prove there are great companies out there with double digit growth numbers, I've extended my watchlist. It now features both yield and 3-yr DGR numbers. In addition to this, I've marked some great companies like DOV, MMM, TROW, HP and ADM in bold. This means these companies have double digit growth numbers in the DGR-5, DGR-3 and DGR-1 categories.

Have a great weekend!

Recent buy - May

Procter & Gamble (PG)
Buy: 13 shares @ 80.30

Before I started this blog, I never heard of Procter & Gamble.
It is a huge American company, but they do not operate with that name in Europe.

However, many of their companies are very well known through all of Europe. For example: Oral B, Gilette, Pampers, BrAun, Head & Shoulders and Duracell.

So what about the interesting numbers?

Dividend yield: 3.33%
3yr growth rate: 7.2%
5yr growth rate: 8.0%
P/E: 23.59

Besides these numbers, they have been raising their dividend for 59 years in a row!

The growth rates could have been better, but this yield is pretty decent for a Dividend Aristocrat like PG.

This adds $34.47 to my annual dividend income.
My portfolio has been updated accordingly.

Thanks for reading!


Disclosure: Long PG

Dividend income & dividend raise!

April was not the most lucrative month of all times, but every penny helps.

Dividend income

KO paid me $13.53 for the 41 stocks I own.

In order to achieve the annual $300 of dividends, I should have received $100 by now.
Unfortunately the sum of received dividends is stuck at $75.91.
However, 15% tax is already deducted from the $75.91, so the gross amount of dividends is around $89. I'm not sure whether I meant gross or net when I set the $300 goal..

Being behind schedule gives me motivation to research new investment oppertunities, so expect to see more information on that, as soon as possible!

Dividend raise

My nice friends over at Johnson & Johnson (JNJ) decided to give me a 7.1% raise!
I'm wondering why I'm working so hard at the office. They provided me with a 0% raise, last January. On the other hand, in order to obtain this 7.1% raise, I did absolutely nothing.
Do you see a pattern here? :-)

JNJ raised their quarterly dividend from $0.70 to $0.75.

Thanks for reading!

Dividend Income - March 2015

March was a good month for me. Five of the seven companies I'm invested in, were paying their dividends this month.

JNJ $11.20
TGT $14.56
AFL $7.41
CVX $10.70
MCD $9.35

Total: $53.22

This brings the total dividends received in 2015 at $65.82.
Looking at my goal to receive $300 in dividends by the end of the year, this number is not sufficient.

It means I have to do more research in order to find more investment opportunities. The sooner the snowball grows, the faster it will be running down..

Happy Easter all!

Thanks for reading.

New investment oppertunity

Looking at my watch list there are currently 12 stocks trading close to their 52-week low figure. This month, I'm trying to add a stock in the Industry sector, as I do not own any stock in this sector yet.

There are a few possibilities I'd like to discuss with you!

3M Company (MMM)

3M is a huge manufacturer of a wide range of industrial products. From Post-Its to petcare, this company owns a large number of well known brands. They have been raising their dividends for 57 years in a row! That sure sounds like music to my ears.

The only disadvantage: it currently trades close to their 52-week high value.

Illenois Tool Works (ITW)

ITW is another global manufacturer of industrial products. They operate in segments like Automotive, Food Equipment & Construction Products. The company has been raising their dividends for 40 years in a row. Not too shabby!

Deere & company (DE)

Founded in 1837, this company sure knows how to design and manufacture farm equipment. It is the largest agriculture machinery company in the world. Although they announced to lay off 600 of their employees in the US due to less demand of their products, I'm pretty confident they will find other ways in upcoming markets to increase their revenue.

They have been raising their dividends for 11 years in a row.

Textainer Group Holdings Inc (TGH)

Textainer is a freight company managing containers. They sell, manage and lease containers to various shipping lines. With over 2 million containers in their fleet, this is one of the largest companies at their segment.

During Q3 and Q4 in 2014 the stock went down from $40 to $28. As it is currently trading at $29, this should provide a very nice entry point.

They have been raiding their dividends for 8 years in a row.

General Electric (GE)

General Electric is a diversified technology and financial services company. It serves customers in more than 100 countries. Their products and services range from power generation, water processing to medical imaging. The company has shown a steady growth over the last few years, but their 5 year growth number is very low. Despite the short 5 year streak of dividend raising, they have been paying dividends for 40 years now.

This is another stock that's trading close to its 52-week low number.

Stock stats

All of these companies look like solid investments to me, but when we compare some growth and yield stats, there are huge differences.

I'm definitely looking for double digit growth numbers, so ITW will not be the winner here.
Do you have any thoughts?

Thanks for reading.

Dividend raise - T

I'm very excited to announce my very first dividend raise!

AT&T raised their dividend from $0.46 to $0.47.
This is a 2.1% raise. Sadly but true, this is more than my paycheck raised back in January..

It is also twice as much as my bank offers me in interest. Dissatisfaction about this low interest was one of the main reasons to start this journey, so I'm very happy about this raise.

At the 2nd of February AT&T paid me a total of $22.56 for my 48 stocks.

These raises are the power of DGI, so I'm very excited to plan my next investment, in order to receive many more raises in the future.

Did you have any recent raises?

Thanks for reading!

Recent sell - TICC

Back in July I did a small investing experiment.
Despite all the alarms around this company, I bought a few stocks of a company called TICC.
Main reason for this was: I had not enough capital left to buy a blue chip stock, but the 12% dividend also looked very attractive.

This extremely high yield obviously has its reasons. The stock has been declining ever since I bought it.

Bought it at $9.80 and I sold half a year later for $7.44.
Total dividend paid: $1.16. Net result: -$1.20.

Lessons learned: don't invest in companies with extremely high dividend yield. Not even when they have more than 10 years of dividend paying history.

Despite the loss, this lesson seems to be much more valuable than this single dollar.

Have you had any risky operations going?

Thanks for reading!

Recent buy - January

Chevron  (CVX)
Buy: 10 shares @ 107.73

With the low price of crude oil, this was an obvious purchase. Thanks for all the advices in the comments. It's much appreciated!

Thanks for reading!


Disclosure: Long CVX

New investment oppertunity

One of my goals is to keep the portfolio as diversified as possible from the start of my investing career. In order to achieve that, I used to compare stats of companies in very different sectors, because I did not own shares of any of these sectors, so it did not matter which I bought.

This comparison however, does not make very much sense.
Stats like PE and growth percentages make more sense if you compare KO & PEP, rather than MCD, UVW & DE.

Current sector diversification

For this graph I used the sectors from David Fish's CCC list.
So I'm looking for an investment oppertunity in one of these sectors, as I do not currently own them.

• Energy
• Industrials
• Information tech
• Materials
• Utilities

As the oil price is plumming, Energy seems a very good sector to start investing in. Let's compare a few companies in this sector.

Chevron Corporation (CVX)

CCC Category: Champion (>25 years dividend increase)
Yield: 3.82%
P/E: 10.33
5 year DGR: 9.62%

Heimerich & Payne Inc (HP)

CCC Category: Champion (>25 years dividend increase)
Yield: 4.08%
P/E: 10.45
5 year DGR: 67.35%

Exxon Mobile (XOM)

CCC Category: Champion (>25 years dividend increase)
Yield: 2.99%
P/E: 11.63
5 year DGR: 10.22%

British Petrolium Inc. (BP)

CCC Category: None, but they pay dividend since 1993.
Yield: 6.36%
P/E: 12.03
5 year DGR: unknown

As I am still constructing the foundation of the portfolio, I'd like to keep investing in Champion companies, so I won't be investing in BP for now.

Any thoughts on the others? I've noticed other bloggers picking up CVX recently, but these numbers favor HP, don't they?

Thanks for reading!