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Tuesday, March 1, 2016

Recent Buy: STAG Industrial Inc

29 Feb 29 2016: Bought 100 shares of STAG at $17.70 per share.

Founded on July 21, 2010 and based in Boston, Massachusetts, STAG Industrial Inc (NYSE:STAG) is a real estate investment trust focused on the acquisition and operation of single-tenant, industrial properties throughout the United States.

STAG is a Dividend Challenger, having paid and raised dividends for 6 consecutive years. The company pays monthly dividends of 11.5833¢ per share. At my buy price, the stock yields 7.85%.

I already own shares of STAG. I first bought shares of STAG in July 2015 at $18.94 per share and at an initial yield on cost (YoC) of 7.29%. Those shares now have a YoC of 7.34%.

With this buy, I'm adding $139 to DivGro's projected annual dividend income, which now totals $8,651.11. One of my goals for 2016 is to increase projected annual dividend income to $12,000.

I usually buy shares in amounts of $2,500 at a time. Here I'm only spending $1,770, which is $730 less that the usual amount. The reason is that I hold my STAG shares in an IRA account and I didn't have enough cash for a full position. (I can't add more cash in 2016, either, because I maxed out my 2016 contributions). When my holdings in this IRA account have paid enough dividends, I'll look for a good opportunity to buy more STAG shares worth about $730.

The following chart shows STAG's recent price history along with my buy prices. By dollar-cost averaging down, I'm reducing my cost basis to $18.42. Average YoC is 7.54%.

 Source: Scottrade

I like STAG for its impressive yield and sound fundamentals. I also like the fact that STAG is a monthly dividend payer, which means dividend income can be reinvested faster! STAG is highly diversified along several dimensions, including geography, tenant, and industry:

One reason I like STAG is that it now pays monthly dividends. The company switched to monthly dividend payments in November 2013:

Here are updated ratings for STAG:

 Zacks Rank 3-Hold (C•C•A)†
 Thomson Reuters StockReport+  (5/10) Neutral 
 TheStreet Ratings Rating Hold [C-]
 The Motley Fool's CAPS Rating (****-)'s DARS Rating  3.3/5

100 shares of STAG adds $139 to DivGro's projected annual dividend income.

Thanks for reading! What do you think of this buy? Do you own shares of STAG or are you considering buying shares?


  1. I've heard of STAG but never investigated the company. I just took a tour of their site and went through investor presentations. This looks like an interesting company. Monthly dividends are icing on the cake. Nice buy Ferdi.

    1. Follow the included link to Brad Thomas' article over at Seeking Alpha. He has a very comprehensive analysis of STAG. He gives the company a strong buy rating.

      I really like monthly dividends -- they help to smooth out the variation in dividend income from month to month.

      Thanks for visiting and commenting!

  2. i like the buy, this one is on my watch list, i am building cash for a buy, i like the idea you have it in a ira, i too want to do this, im new in the game, but learning as much as i can, thanks for the article i just found you on SA.

    1. Thanks for visiting my blog and for commenting! All of us have to start somewhere! Congratulations on making the decision and for learning as much as you can. In my case, I've learned a lot by writing this blog and communicating with other DGI bloggers. Best of luck!

  3. Nice buy FerdiS, I am right there with you. My last purchase was $15.92, my basis is $17.70. Lovin the comeback! Keep up the good work.

    1. Excellent buy at $15.92, Mike! Congratulations... and thanks for your continued encouragement!



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