Monthly Income Update – July 2023

Dear Readers,

For the first time in nearly two years, I am woefully late on publishing my monthly income report. Apologies for this! Why the delay? Well life happened. As I mentioned in my last monthly income report, I was dealing with medical emergencies in the family. Thankfully (fingers crossed) those are now on the path of resolution. But since my family needed me during this time, the blog and the portfolio took a back seat (as it should).

Luckily, July was supposed to be a “slow” month for my portfolio, as we shall see in the numbers shortly. But there is no slowness in the market as earnings season was on full swing during the month. While I am not particularly concerned with quarterly earnings as much, I do keep an eye on certain holdings just to see if I notice some interesting commentary from the management about future direction of their businesses.

I want to talk about two such companies in the “Core” category of my portfolio. But first, lets get into the numbers.

Monthly Income Report

Sl. No.	Company/ ETF (ticker)	Amount
1	J P Morgan Chase (JPM)	$37.02
2	Realty Income (O)	$35.93
3	JP Morgan Equity Premium Income ETF (JEPI)	$10.21
4	CareTrust REIT (CTRE)	$15.33
5	Toronto Dominion Bank (TD)	$7.29
6	STAG Industrial (STAG)	$4.1
	Total	$109.88

So a total of $109.88 from 6 companies/ETFs. At the same time last year, I made a total of $112.52. I did not sell any new option contracts during this month. So for the first time since the inception of the portfolio, the YoY growth in the monthly income was negative. Not quite the type of record to celebrate 🙂 Why the decrease? Well, July 2022 had some contribution through option premiums as well. Without the options, the dividend portfolio by itself did see a YoY increase. But in the interest of keeping performance measurement metrics consistent and not shifting goal posts periodically, I will call this a decrease.

Buys and Sells during this month

Transactions were at an all time low during this month, because I was tending to family. When I did get a chance to look at my portfolio during a lunch break at work, I noticed that some of my buy orders for TGT and MCHP had triggered.

No sells during this month.

Earnings and other news

One of my core stocks, JNJ, was in the news for the split-off announcement of their consumer health business, now called Kenvue (KVUE). The split-off exchange offer is sufficiently detailed on the JNJ investor relations website.

Did I participate? No. As things stand, I am not very interested in the consumer health business. As I had noted in my deep-dive analysis post on JNJ, the consumer health business has been a slow grower for several years now. And looking forward, I am not seeing any lurking growth drivers in that business. On the contrary, both pharmaceuticals and medical technology, the remaining two business segments that will remain with JNJ are far more faster growing with more potential for growth. That said though, this does change my investment philosophy slightly with JNJ as it longer is this conglomerate like business but rather a more pure-play pharma and/or med-tech business. This is not necessarily a bad thing for me as an investor in JNJ.

The other holding of mine that was in the news was TXN, who had a fairly ordinary/bad Q2 quarterly earnings report. Revenue down 13% YoY, net income down 28% YoY and more importantly free-cash-flow, TXN’s preferred performance metric, down 46% YoY. Those are bad numbers any which way you look at it. But digging into the numbers a little bit, some of the reasoning behind the numbers is not particularly surprising. I will reserve my thoughts on TXN for a future twitter/X thread.

(Update: See thread below)

$TXN is a core holding in my dividend portfolio. It had a fairly ordinary Q2 earnings report and subsequently the stock dropped 6% after the earnings release.

I finally got an opportunity to dive into the results. A brief 🧵👇

♥️/RT = 🙏 pic.twitter.com/wLPUOnY7ok

— Life With Dividends (@LifeWDividends) August 21, 2023

Summary

Well, another month is in the books. The portfolio continues to chug along generating dividend income at a reasonable clip. I am looking forward to the next few months as we head towards the close of 2023.

How did your month go? Let me know in the comments below.

Cheers,

LWD