Monday, December 4, 2017

Recent Additions To Existing Positions

In November's DivGro Pulse article, I identified a few existing DivGro positions that I wanted to increase. The number one-ranked stock in my portfolio is CVS Health (CVS), which traded at a discount of 20% to my fair value estimate. CVS also is the top-ranked stock in November's 10 Dividend Growth Stocks to consider.

After closing my Pfizer (PFE) position and anticipating some tax-harvesting sells, I wanted to boost DivGro's projected annual dividend income (PADI) a bit. So, in addition to adding shares to my existing CVS position, I also added shares to high-yielding Omega Healthcare Investors (OHI). It probably is a risky move, as OHI is now yielding nearly 10% and concerns about the impact of problems with one of its tenants linger. The REIT reported worse-than-expected third quarter earnings at the end of October which resulted in a steep drop in the share price.

CVS Health (CVS) – Added 50 shares of CVS @ $70.62 per share


CVS provides integrated pharmacy health care services. The company advises patients on medications at CVS Pharmacy locations; provides cost control programs through CVS Caremark; delivers care to patients through CVS Specialty; and provides pharmacy care for seniors through Omnicare. CVS was founded in 1892 and is headquartered in Woonsocket, Rhode Island.


I already own 50 shares of CVS, so this buy doubles my CVS position to 100 shares.

Please see this article for a recent analysis of CVS.

Omega Healthcare Investors (OHI) – Added 100 shares of OHI @ $27.07 per share


Founded in 1992 and based in Hunt Valley, Maryland, OHI is a self-administered that invests in income-producing healthcare facilities in the United States and the United Kingdom. The company provides long-term leases or mortgage financing to healthcare operating facilities. OHI secures funding through loans, revolving credit, equity securities, and secured indebtedness. 

I added 100 shares to increase my holding to 500 shares. OHI's average cost basis is $34.23 per share, while the average yield on cost is 7.59%. This buy adds $260 to DivGro's PADI.

Please read this article for a recent analysis of OHI.

Conclusion


Recently I added shares to two existing DivGro positions, CVS and OHI. The former is the top-ranked stock in DivGro and trades at a significant discount to my fair value estimate. The latter is a high-yielding REIT with lingering concerns about one of its tenants. While a little riskier, I believe my investment in OHI eventually will pay off. We'll see how it goes!

Thanks for reading! 

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