Saturday, June 10, 2017

Monthly Review: May 2017


Welcome to monthly review number 53 of DivGro, my portfolio of dividend growth stocks!

After last month's disappointing total, I'm happy to say that I added dividend income totaling $1,278 in May.

This amount includes $460 in past dividends and $818 in new dividends. Past dividends are from a stock in one of my wife's IRA's, which I'm now managing as part of DivGro.

May Highlights

The main goal of DivGro is to generate a growing dividend income stream. That's why I like to review my dividend income and any changes that would affect future payments.

In the month of May, I collected dividends totaling $818 from 14 different stocks. Also, I added past dividends of $460 from Intel Corporation (INTC) after bringing one of my wife's IRA's into the DivGro fold. Including these amounts, I've collected dividend income of $6,522 year-to-date.

DivGro's projected annual dividend income (PADI) increased by $1,242 to $14,692. I opened one new position and added shares to two existing positions. Furthermore, two of my holdings announced dividend increases.

The following chart plots DivGro's projected monthly dividend income (red line) against monthly dividends:


The following chart presents a rolling 12-month average of dividends received (the orange bars) plotted against a rolling 12-month average of DivGro's projected monthly dividend income, or PMDI (the blue staggered line):


Another way to see progress is to compare dividend income by month:


Transactions

In May, I added shares to two existing positions:

• Intel Corporation – I added 320 shares (120 from my wife's IRA and 200 from an options assignment)
• Target Corporation (TGT) – I added 200 shares from an options assignment

Also, I opened the following new position in DivGro:

• Nuveen Floating Rate Income Fund (JFR) – this closed-end fund pays monthly dividends and yields 6.76%

Dividend Changes

The following stocks announced dividend increases:

• Northrop Grumman Corporation (NOC) – increase of  11.11%
• Chubb Limited (CB) – increase of 2.90%

Dividends Received

I received dividends from 14 different stocks this month:

• Apple Inc (AAPL) – income of $63.00
• AbbVie Inc. (ABBV) – income of $128.00
• CVS Health Corporation (CVS) – income of $20.00
• General Dynamics (GD) – income of $29.40
• Hormel Foods Corporation (HRL) – income of $17.00
• Main Street Capital (MAIN) – income of $83.25
• Realty Income Corporation (O) – income of $10.55
• Omega Healthcare Investors (OHI) – income of $189.00
• Procter & Gamble Company (PG) – income of $68.96
• Raytheon Company (RTN) – income of $19.14
• STAG Industrial Inc (STAG) – income of $28.00
• AT&T Inc (T) – income of $82.81
• United Parcel Service, Inc. (UPS) – income of $20.75
• Verizon Communications (VZ) – income of $57.75

Markets

Even though I'm no longer comparing DivGro's performance to market indices, its useful to understand the environment we're investing in:

Apr 30, 2017
DOW: 20,940.51S&P 500: 2,384.20NASDAQ: 6,040.7110-YR BOND: 2.28%
May 31, 2017
DOW: 21,008.65S&P 500: 2,411.80NASDAQ: 6,198.5210-YR BOND: 2.21%

In May, the DOW gained 0.33%, the S&P 500 gained 1.16%, and the NASDAQ gained 2.61%. The yield on the benchmark 10-year Treasury note fell to 2.21%.

Below are charts showing the market activity of these indices in May, courtesy of Google Finance. (Click on the charts to see detail). Each chart shows a 20-period exponential moving average (in red). I've also included a 20-period relative strength index below the main chart.



Market Value

This month, DivGro's market value increased by 3.89% to $439,017. Compared with May 2016's market value of $306,671, the year over year increase is 43%.

Market ValueCash DepositsSimple Return
May 31, 2016
$306,671.00$271,819.1012.82%
Apr 30, 2017
$422,558.85$316,292.8133.60%
May 31, 2017
$439,017.07$331,816.2332.31%

Here's a chart showing DivGro's market value breakdown. Dividends are plotted at the base of the chart so we can see them grow over time.


Given the current market value of $439,017, my portfolio has delivered a simple return of 32.31% since inception. In comparison, DivGro's IRR (internal rate of return) is 14.54%. (IRR takes into account the timing and size of deposits since inception, so it is a better measure of portfolio performance).

Portfolio


Here is a snapshot of DivGro's state on the last day of May 2017:


I track the yield on cost (YoC) for individual stocks, as well as an average YoC for my portfolio. DivGro's average YoC increased from 4.01% last month to 4.03% this month.

Another interesting statistic is percentage payback, which relates dividend income to the amount of capital invested. DivGro's average percentage payback is 9.62%, down from last month's 10.09%.

Finally, DivGro's projected annual yield is at 4.43%, up from last month's value of 4.25%. I calculate projected annual yield by dividing PADI ($14,692) by the total amount invested ($331,816).

Goals Review

I've set some challenging goals this year:
  1. PADI: Increase projected annual dividend income to $14,400
  2. Dividends: Earn $12,960 in dividend income
  3. Dividends: Earn $8,400 in options income
  4. Seeking: Write 64 premium articles for Seeking Alpha
  5. DivNet: Write 6 articles for The DIVNet
Here is a set of gauges representing the progress I've made towards achieving these goals. The last gauge is a reference – it indicates where the other gauges should be after 151 out of 365 days:


After some big purchases in May, PADI jumped past my 2017 goal of $14,400! With more than six months to go, I think I need to increase my PADI goal!  I'm also ahead of schedule with my other goals except, of course, for DivNet, which remains stuck at 0%! I'm hoping to get around to writing a few articles for The DivNet soon.

Looking Ahead

June is a quarter-ending month, so I'm looking forward to collecting lots of dividends! I wonder if I'll set a new monthly record for DivGro in June?

Please see my Performance page for various visuals summarizing DivGro's performance.

Thanks for reading and take care, everybody!

10 comments :

  1. Wow, what a month for you! Reached some goals and increased the PADI by a huge number! It's really great to watch that graph increase slowly over time, it is a slow race we run but in the long run it will pay off! Well done

    ReplyDelete
    Replies
    1. Hi BHL -- thanks for commenting! Yes, it was a great month and I'm quite pleased that I reached some of my goals early. However, I feel it is necessary to revisit those goals now that I've reached them. Perhaps they were not stretching enough!

      Delete
  2. Great job on the PADI. i cant wait to be at that level. Love the report and great month you had.

    ReplyDelete
    Replies
    1. Thanks, FiscalVoyage -- hang in there and just keep going... and you'll soon reach that level. I know a few years ago I was in your position!

      Delete
  3. Hey DivGro,

    that's some awesome numbers!! and a good visualization... your snowball is getting really big and if you keep up this pace you'll reach FI in a few years. Thanks for sharing and motivating...my div-income for may was 711$ and i keep on grinding. If you have the time you can check out my portfolio here:
    https://dividendsolutions.wordpress.com/portfolio-dividends/

    Greet's from Germany,
    DividendSolutions

    ReplyDelete
    Replies
    1. Hi there, DividendSolutions! Thanks for visiting and commenting.

      Congratulations on your dividend income for May -- that's a great total!

      I added your blog to my blogroll in the New Blogs section. Keep up the good work and, remember, dividend growth investing (and blogging) is a marathon, not a sprint.

      Take care and happy investing!

      Delete
    2. Hey FerdiS,

      thanks a lot for adding my blog to your blogroll. - i know that i have a long way to go;-), but the journey is so much fun day by day. I'm prepared to run the marathon...

      Cheers,
      DividendSolutions

      Delete
    3. You're welcome, DividendSolutions -- all the best!

      Delete
  4. Congrats on a fantastic dividend month. Even more impressive because it happened in May. June should be amazing. Nice job Ferdi.

    ReplyDelete
    Replies
    1. Thanks, Investment Hunting! I'm really looking forward to seeing what June brings. Quarter-ending months are my favorite months due to the boost in dividend income...

      Take care and happy investing!

      Delete

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