Thursday, May 2, 2013

Monthly Review, April 2013

It has been a rather busy month for me. Early in April, I travelled to South Africa, spending precious time with family and friends. The least fun part of my short vacation was the return flight of 16 hours (non-stop!) from Johannesburg to Atlanta. I didn't realize that airplanes can fly so far, especially lifting off in Johannesburg at altitude! I don't sleep in airplanes, so that was a bit of an ordeal. Then there was tax day. Due to jet lag, I did just enough of my taxes to apply for an extension. So I'm still not done with my taxes… And, to top things off, back at work things have been crazy busy!

Given all of the above, I'm very happy with my DivGro activities in April. I wrote six posts, including my first quarterly review. Also, I transferred some funds into DivGro after one of my CD's reached maturity. This bonus deposit provided some welcome cash for more dividend growth stock buys. To that end, I evaluated Aflac Incorporated (AFL) and ConocoPhillips (COP), deciding to go with AFL because of its superior fair value discount.

COP remains interesting because it pays a dividend of $2.64 per share. This represents an attractive yield of about 4.4% (at the current price of $60). I think COP would be a good buy at $56, so for now I'll just wait.

My purchase of AFL increased DivGro's diversification into the Financial sector and added annual dividend income of $70 (or $52.50 for the 2013 calendar year).

At the end of April, my portfolio contained 6 stocks and had a market value of $28,692.11. This represents an overall gain of $1,692.11, or 6.27% since January. Of course, the PRR (personal rate of return) for DivGro is much higher (see my recent quarterly review of DivGro).

Transactions:
  • 2013-04-02: Bonus APR Cash Deposit: $10,000
  • 2013-04-16: BUY 50 AFL @ $50.06 ($70.00 Annual Income)
  • 2013-04-30: MAY Cash Deposit: $1,000
New Dividends/Dividend Increases:
  • The purchase of AFL increased expected dividend income for 2013 by $52.50
  • In April, CVX increased its annual dividend by 11.1% to $4.00, adding $7.50 to expected dividend income for 2013; annual dividend income for CVX now is $100.00
  • Total expected dividend income for 2013 is $781.09
  • The forward 12-month projected dividend income is $820.69
Dividends Received:
  • Total year-to-date: $138.88 of $781.09 (17.78%)
Markets:
Mar 31, 2013
DOW: 14,578.54 S&P 500: 1,569.19 10-YR BOND: 1.85%
Apr 30, 2013
DOW: 14,839.80 S&P 500: 1,597.57 10-YR BOND: 1.67%

Portfolio: Here is a spreadsheet showing DivGro's current holdings:
Yields: The following spreadsheet presents the current yield on cost for my stocks and the cumulative dividends received:
Looking Ahead: I'm still waiting for NTT's semi-annual dividend payment. Hopefully that will come through in May, along with some other dividend payments I'm expecting. I have enough cash available to buy at least three more stocks, perhaps even four if those dividend payments materialize. In May, I'll continue to evaluate a few of my watch list stocks in the hope of finding undervalued dividend growth stocks to buy.

If you have suggestions for candidate stocks to evaluate, feel free to share by posting a comment!

6 comments :

  1. Ferdie,

    Wow your picks have been on fire! ...what's the secret? I like that cumulative dividend chart, I think I'll copy you for fun sometime.

    Most of my favorite companies seem to be pretty pricey right now, but it doesn't matter because I'm buying something anyways. I'm having to dig deep into my watch list for ideas though. Currently looking at BAX which seems to be mildly undervalued. Perhaps XOM if it falls a little bit.

    Anything in particular that is catching your eye?

    ReplyDelete
    Replies
    1. Thanks for stopping by again!

      I really don't have any secret to selecting stocks other than the strategy I'm following, which I discussed in a post dated February 10, 2013. In this market environment, it just feels a bit too easy... though I'm under no illusions!

      BAX is not on my watch list, but I'll take a look. Thanks for sharing! XOM looks interesting, but I agree that it needs to fall some, perhaps as much as 5% or more.

      As I mentioned to you in an earlier post, I'm still eyeing COP, which I analyzed last month when it was below $58. See where it is now? Perhaps that ship has sailed...

      I'm also eyeing NOC and SWY, though I think the latter has too much debt for my liking.

      Hope that helps -- please continue to share your thoughts!

      Delete
    2. Oh, and BTW, please copy the cumulative dividend chart if that's helpful to you!

      Delete
  2. Yes you were right about COP. I still wonder what will happen with the dividend though. I have no plans to sell my position however, just hold. I find that oil stocks bounce around quite a bit.

    I did buy BAX on the dip a few days ago. Should be a nice holding that will help to round out the portfolio. Tried to make a dividend chart like yours, but I discovered it will be way too much work. For now I'll marvel at yours and may revisit that idea sometime in the future when I have nothing better to do.

    Keep the posts coming, love the blog!

    ReplyDelete
    Replies
    1. I looked at BAX. Its current yield is less than the 2.75% I look for. Also, its P/E > 16% and I can't find a debt/equity estimate. Fair value estimates for BAX vary greatly, so I'm not so confident that I can pin down a good entry point. On the other hand, BAX's dividend growth rate is great and it seems like a safe dividend (payout ratio < 50%).

      Congrats on the buy!

      Delete
    2. I just noticed BAX increased its quarterly dividend by 9% to $0.49 per share. That would make the yield about 2.8%. Mmm...

      Delete

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