Wednesday, September 30, 2015

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!

Thursday, September 10, 2015

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
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).

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!