Monday, July 14, 2014

Recent buy - July

At my last post I did some research about a couple of blue chip stocks which are currently trading close to their 52w-low figure. Some of my readers gave me valuable advice, which is much appreciated!

Getting so much kind words and good advice from fellow bloggers is great to notice and I have to say this feels like a warm welcome in this very kind community, as I am just the little new guy in town.

Aflac (AFL)
Buy: 19 shares @ $63.02

My broker is very cheap with their transaction costs (about $1 per transaction), but the interface is very basic. Another downside is that it does not allow fractional stocks to be purchased. After last month purchases I had about €80 in my account as leftovers. After todays purchases I had about $25 in my brokerage account which was not working for me. This bothered me.

In order to put this money to work for me, I wanted to invest it in some company with a high yield. However, the price for this stock should be as low as possible, since I only had a few bucks left. It was then when I came across a handy website for this matter: DiviData.

At this site, I came across a company called TICC. This was the highest yielding company with more than 10 years of dividend paying history. This stock certainly does not belong in a portfolio focused on long term and growth, but I couldn't resist buying 2 shares at an amazing 11.92% yield. After just 2 terms of dividend from this company, the transaction costs will be covered. I'm probably going to sell this stock shortly after that, in order to use this capital to buy a new blue-chip stock, which I couldn't afford this month.

TICC Capital Corp. (TICC)
Buy: 2 shares @ $9.80

In other news, my watchlist is growing.
I added 52w high/low values to the list, in order to try to find a bargain.
However, this was not easy readable, so I added a percentage. This percentages reflects the growth of the stock, compared to its 52w low value. Hopefully this makes selecting stocks for further analyses a bit easier for me.

Thanks for reading!

Full disclosure: Long AFL

Tuesday, July 8, 2014

Stock analysis - July

As of July I have $1000 available to buy a new position.
I'm trying to get a diversified portfolio. My current portfolio consists of stocks in these sectors: Telecommunications, Consumer Staples, Healthcare & Consumer Discretionary.

This means my next purchase should be in one of the other sectors. Of course I take into account that I do not want to pay a full price for a stock, so it should be trading close to its 52-low at the moment.

Looking at my watch list, there are just a few safe options to go for: WGL, BMS & AFL.

  • WGL Holdings Inc (WGL)
WGL Holdings Inc. is a public utility holding company serving the Washington, D.C. metropolitan region.
It has been paying dividends for an amazing 162 years. They have been increasing their dividends for 37 consecutive years now. Needless to say, this stock is about as safe as it gets.

Yield: 4.1%
DGR-1y: 4.6%
DGR-5y: 3.4%
P/E: 119

So the yield is pretty good and the DGR is average, but the P/E is very high. Not only compared by the S&P 500 but also compared to all other Dividend Champions in the same sector. I'm not a very experienced invester, so I searched for what this high P/E could mean. Several websites stated that 'Generally a high P/E ratio means that investors are anticipating higher growth in the future.'.

This sounds good, but are there any downsides to this?
  • Bemis company (BMS)
Bemis is a global manufacturer of packaging and pressure sensitive materials with 2013 net sales of $5.0 billion. A large part of their business is related to healthcare. They have been paying dividends for 98 years, while raising dividends for the last 31 years.

Yield: 2.7%
DGR-1y: 4.0%
DGR-5y: 3.4%
P/E: 19.8

Seems like this company has average DGR numbers, as well as an average P/E, but the yield is a bit low. I'm not familiar with this company, even tho it seems like it's a multinational, with operations in almost every continent. Any thoughts?

  • AFLAC Inc. (AFL)
Aflac is a major company in insurances. In the US probably most known for their payroll deduction insurance coverage, but especially in Japan Aflac is huge. According to their own numbers, 1 out of 4 life insurances in Japan in theirs.

Yield: 2.4%
DGR-1y: 6%
DGR-5y: 8.1%
P/E: 9.74

I feel like this stock is value for money. Due to the low Yen, they had a -5% result, compared to last year. This is probably the main reason the stock went down twice this year. The yield and the P/E are low for this company, but the growth rates looks promising.

Please share your thoughts on these stocks.

Thanks for reading.

Update on the goals

As of today, our national soccer team scored an amazing number of 12 goals during the World Championship.
This is good news, but not the news I want to talk about.

Save at least €200 annually on some unnecessary expenses
I've moved 2 years ago, but I was still paying some of the bills of my previous home. This is because my parents still live there. Two weeks ago I've talked to them and we agreed to change this. As of next month they will be paying their own internet and television bills. This saves me €564 annually!

Sell at least worth of €300 on Ebay
This is a difficult one for me. I'm not very good at selling stuff I don't use anymore. My Wii, several collectors editions of games and some old hardware have been eating dust for a couple of years now. This money should work for me, but instead it's devaluating each month. The deadline is in 2 months so I have to start sacrificing something for the greater good.

Stop buying expensive stuff I don't need
So far so good. The only temptation I had was the Steam Summersale. I love gaming and I have about 250 games in my library. Of those games, about 100 are never even started after buying them..
When I was in college I had a lot of time for gaming, but when you start living on your own and getting a fulltime job, there is little time left to spend on gaming. However, I had more money so I kept buying games..

I'd like to think it's some sort of addiction and I am trying to stop it! As I said.. so far so good. :)

Receive $200 on dividends annually by the end of 2015
I have amazing news on this one. My broker pays dividend on the ex-dividend date. AT&T annouced their dividend payout yesterday, which means I received my very first dividend today. This $18.77 ($22.08-$3.31 tax) may seem small, but I am very excited about this!

Thanks for reading!