Sunday, February 28, 2016

Recent Buy: HCP Inc.

17 Feb 2016: Bought 90 shares of HCP at $27.58 per share.

Formed in 1985 and based in Irvine, California, HCP, Inc (NYSE:HCP) is an independent hybrid REIT (real estate investment trust). The company invests primarily in properties serving the healthcare industry in the United States, including sectors such as senior housing, life science, medical office, hospital and skilled nursing. HCP acquires, develops, leases, manages and disposes of healthcare real estate and provides financing to healthcare providers.

HCP is a Dividend Champion with an impressive track record of 31 consecutive years of dividend increases. The company pays quarterly dividends of 57.5¢ per share in the months of February, May, August and November.

At my buy price of $27.58, the stock yields 8.34%. Adding 75 shares of HCP to DivGro increases projected annual dividend income by $207.

I already own 75 shares of HCP, which I bought in November 2015 at an initial yield on cost (YoC) of 6.65%. With this buy I'm increasing my HCP share count to 165 for a total projected annual dividend of $379.50.

The company's recent price history is shown in the following chart, along with my buy prices. My recent buy is at a lower price, so cost basis is reduced to $30.50 per share. Average YoC is 7.54%.

Source: Scottrade

As mentioned earlier, HCP has a track record of 31 consecutive years of dividend increases. The company is the only REIT included in the S&P 500 Dividend Aristocrats Index. Here is a chart showing a 25 year history of dividend payments:

Updated Ratings for HCP

MorningStar Rating (****-)
S&P Capital IQ's Stock Report (***--) Hold
Thomson Reuters StockReport+   (4/10) Neutral
TheStreet Ratings Rating Hold [C]
The Motley Fool's CAPS Rating  (*****)'s DARS Rating 3.2/5

This buy adds $207 of expected dividend income. As of 27 February 2016, DivGro's projected annual dividend income is $8,512.11.

What do you think of this buy? Do you own shares of HCP? Please respond in the comment section below.


  1. I also just bought more of HCP. It is now my largest holding next to T. Until the last few months it has been a total SWAN. Hopefully it can recover soon.

    1. Its great to add more shares of HCP and to reduce my cost basis to boot! It would be interesting to see where the stock will go in the next few years. Best of luck to you and thanks for commenting!

  2. Looks like the recent price swoon for the whole health REIT sector did not scare you. The decline, in my opinion, was way overdone. HCP is one of my potential picks going into March among other names. Nice pick up. Thanks for sharing.

    1. I agree that the price decline is overdone. It does give us an opportunity to swoop in and pick up shares at a great discount! I like HCP and should they weather the storm, collecting the dividends will be a pleasure!

  3. DivGro,

    Overall, you can't go wrong with an investment with HCP. They're a great REIT for your money. You'll go far with the investment as the dividends will help you reinvest faster into other companies. Great pick!

    -Dividend Monster

    1. Thanks, Dividend Monster -- I appreciate your comment. I like HCP here and particularly the great yield. Hopefully the company will be able to continue to grow at a reasonable pace and sustain its dividend growth.

  4. I bought a small position (17 shares I think) of HCP at $26.61, so I definitely agree that it's a good long-term buy. At $30 I'm on the fence about adding to my position, but I might add a few shares this month.

    Really, I'm waiting for Realty Income (O) to drop back down. Anything less than $55 and I'll start adding positions.

    1. Yes, HCP kicked up quickly after my buy and is well above $30 now. I can understand why you would hesitate to add now. Not sure if this helps or not, but the 52-week range is $25.11 - $44.78 at the moment.

      Realty Income popped nicely. When I bought shares at abound $47 and again at about $51, several comments suggested I paid too much and that shares will come down soon. Mmm, just goes to show you really can't predict what will happen.

      Hopefully, O comes down to $55, then both you and I can buy more shares!


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