We are almost half way done with 2023. Summer is on us. Schools have closed for the summer break. Time is really flying by.
I was looking at our expenses and planning for the remainder of this year, my wife discovered that our AC was not really cooling as it should. I took a look at the condenser and sure enough it was dead. In the middle of the day, when temperatures are soaring around the 90 degree mark, this is not a fun time for your AC to give up on you. After some conversations with the repair technician, we were looking at an unplanned expense related to replacing both the condenser and the furnace unit. We did the math and we were looking at a cost of ~$11,000.
Luckily, while this expense was a surprise, this was something that we had budgeted for previously. So I had the cushion of paying for this expense in all cash, without it impacting my investment portfolio or getting into a financing plan (taking on debt) etc.
And this is an important lesson that I would like to share with you readers: Before you even invest a dime in the stock market, please please please setup an emergency fund for yourself and your family. Something that can take care of your family’s needs for atleast a period of 6 months at a minimum. Per a recent report from Forbes, around 57% of Americans cannot afford an emergency expense of more than $1000. I find this statistic quite shocking.
Anyhow, this episode gave me a chance to read up on some of the associated businesses, one of which is Carrier Global (ticker: CARR), which also happens to pay a dividend (although with a very low starting yield). But there are some characteristics that I really liked and so on it went into my watchlist.
The dividend portfolio is doing just fine. I did make some moves (setting up my buy orders) during the early part of this month after which I have had a chance to login to my brokerage account. Let us take a look at the numbers:
Dividend Income Received
Sl. No.
Company / ETF (ticker)
Amount
1.
Apple (AAPL)
$5.31
2.
AbbVie (ABBV)
$21.99
3.
Albertsons (ACI)
$3.26
4.
A.O.Smith (AOS)
$1.20
5.
Caterpillar (CAT)
$3.66
6.
The Clorox Company (CLX)
$53.73
7.
Costco (COST)
$5.13
8.
Procter & Gamble (PG)
$24.05
9.
Texas Instruments (TXN)
$96.73
10.
Verizon (VZ)
$66.99
11.
Realty Income (O)
$31.00
12.
JP Morgan Equity Premium Income ETF (JEPI)
$11.55
13.
STAG Industrial (STAG)
$4.07
Total
$328.67
So a total of 13 companies/ETFs contributing a total of $328.67. While the market was seeing a sudden upward trend during the later half of May, I was able to use this swing to my advantage my writing a covered call option contract and earn and additional premium of $129.31. This brings the grand total for the month to $457.98. At the same time last year, I had earned a total $239.19. So, this is still appreciable growth on a YoY basis.
Buys and Sells during this month
Most of my purchases were during the early part of the month while the market was still trading sideways.
Buys: TROW, TXN, MCHP
Staying in the game purchases: These are purchases where I need to buy a stock after a pre-determined time threshold since last purchase has crossed. No questions. This helps in removing any emotion from the purchase and avoiding timing the market. For this category, I added to my AFL and SNA positions.
Portfolio outlook
As I head into the second half of the year, I want to continue focusing on building up my core positions. Unfortunately, I have not seen the best buying opportunities for some of my core stocks. JNJ is getting into the buying range, so I am going to be looking at that closely. But some of the consumer staples continue to be in the overvalued range (rather frustratingly).
I did some back-of-the-envelope math and while the portfolio is performing really well, I feel I might fall short of the $6000 PADI goal for the year. We shall see. 🙂
How is your portfolio doing? Let me know in the comments below.
We are in the midst of yet another earnings season. And we are continuing to see news about bank failures and other regional banks struggling. Yet the market seems to be holding its course navigating through these troubled waters.
If I am incredibly honest, I have not paid any real attention to my portfolio during the majority of this month. Most of my mental bandwidth has been consumed by my day job, as it should be. During casual conversations with friends and peers in the tech industry, most of them seem to echo what I am seeing at my own workplace i.e. tech companies are in the strict cost-cutting mode, optimizing where possible, laying off workforce and canning ambitious projects that have poor risk/reward metrics. If I looked through the earnings reports for some of the semiconductor companies, my hypothesis regarding a slowdown in the broader semiconductor industry was confirmed.
One aspect that I can confirm is the migraine-inducing hype around ChatGPT and generative AI. I have been in several mindless meetings where execs are trying to figure out how they can shove the generative AI technology into the workflow of projects that are under their supervision. While I understand their motivation and desperation, I am beginning to get sick of this AI hype-train.
Coming to the portfolio itself, April was supposed to be a slow month for me. Lets take a look at how we fared in this month.
Dividend Income Received
Sl. No.
Company / ETF (ticker)
Amount
1
JP Morgan Chase (JPM)
$37.02
2
Realty Income (O)
$30.86
3
CareTrust REIT (CTRE)
$12.08
4
JP Morgan Equity Premium Income ETF (JEPI)
$12.06
5
STAG Industrial (STAG)
$4.06
6
Toronto Dominion Bank (TD)
$3.54
Total
$99.62
So a total of 6 companies/ETFs generated a total monthly income of $99.62. At this same time last year, my portfolio had generated a total of $33.65. As has been the trend so far, year-of-year growth for each month is still appreciably high. This is not surprising because I am continuing to deploy cash into my portfolio at every available opportunity. I did not write any new option contracts during this month, so no income through option premiums.
Among these dividend payers, I have turned OFF my DRIP re-investment into JPM. IMHO, JPM continues to trade at a premium valuation with a Price/ Tangible Book Value well above 1. Furthermore, I am yet to see concrete direction from Jamie Dimon and his management team regarding what they intend to do about their next dividend increase. I can understand them exercising caution with the current turmoil in the banking sector. So this is a wait and watch story for me.
I received dividends from one of the new additions in my portfolio, Toronto Dominion Bank (ticker: TD). This was an interesting pick for me and one where I have been waiting on the sidelines for a long time. TD, like the other major Canadian banks, are rock-solid dividend payers with a stellar dividend payment history. TD, for instance, has never missed a single dividend payment for close to 166 years!! Wow!
My opportunity to initiate a new position came with news reports stating that TD become the world’s most shorted bank stock. While it takes a lot of guts to initiate a position when it is one of the world’s most shorted stock, I was prepared to take the risk. Per my research, the basis for the short thesis was around two points:
Concern around TD’s stake in Charles Schwab, who are sitting on a lot of unrealized bond losses, that has the potential of destroying the company’s equity if it ever had to sell them to cover outflows of deposits.
At the time, pending merger deal with US regional bank called First Horizon.
IMO, Charles Schwab will do fine in the near-term as it has access to a lot of capital in terms of client assets. Regarding the deal with First Horizon, this deal has now been scrapped which has left TD with a lot of cash on hand. I am not sure what the bank will intend to with this excess cash. Two options seem likely: 1) Share buybacks, 2) Returning capital through a special dividend payment. Let us see how this story develops and what this means for shareholders.
The last news item of interest was around STAG Industrial which got recently added into the S&P Midcap 400. STAG has been a solid monthly dividend payer, similar to Realty Income. And while it does boast an attractive starting dividend yield of over 4% at the time of writing, the 5-year dividend CAGR is less than 1%, which is very poor. It was a stock that I added very early in the my dividend investing journey and have not sold out of since. But it is something that I will consider selling when the price is right.
Dividend Increases
As a dividend growth investor, one of the key things I keep an eye out for during earnings season is the news regarding dividend hikes. There are some dividend hike news that caught my attention from the recent earnings:
Costco (ticker: COST): hiked their quarterly dividend by ~13% to $1.02/share.
Microchip (ticker: MCHP): hiked their quarterly dividend by ~7% to $0.383/share.
Johnson & Johnson (ticker: JNJ) hiked their quarterly dividend by ~5.3% to $1.19/share.
The Southern Company (ticker: SO): hiked their quarterly dividend by ~3% to $0.70/share
Procter and Gamble (ticker: PG): hiked their quarterly dividend by ~3% to $0.9407/share
Apple (ticker: AAPL): hiked their quarterly dividend by ~4.3% to $0.24/share.
MCHP, a very recent addition to my portfolio, had a stellar quarterly earnings release and has been an absolute monster as far as dividend growth is concerned. I was obviously thrilled about the double-digit dividend hike from COST.
I am very disappointed with PG’s and AAPL’s dividend hikes. While I can understand PG’s caution to a certain extent given the nature of the business and the sector they are involved in, AAPL’s dividend hike was extremely paltry. AAPL’s earnings were pretty much textbook other than slow-down in sales in Macs and iPads. And they chose to authorize a fresh round of $90B share buyback program, instead of hiking the dividend by a meaningful amount.
While I do not have a problem with share buybacks in general, I think most companies do not use buybacks very effectively, choosing to buy their own shares often at lofty valuations. In such a scenario, I would much rather prefer that these companies return cash back to shareholders in the form of dividends, as this gives shareholders such as myself an opportunity to re-invest these dividends either in the same security or in a different security that is potentially undervalued.
With AAPL’s starting dividend yield being low, and the dividend hikes being paltry, I am left with counting on share price appreciation (in addition to the share buyback yield) for generating meaningful returns from this investment.
Buys and Sells during this month
Trading activity was at an all-time low for this month. So nothing special to report here.
Summary
Another month is in the books. I am really looking forward to the upcoming months and what they have in store for me as far as new investment opportunities.
Three months have come and gone! Can’t believe how fast time is flying. And quite honestly, what a roller coaster this year has been so far. It somehow seems like there is plenty of action to come in the remainder of this year. While I have been a passive spectator to the events happening in the market, I am using every opportunity available to look for bargains to invest.
We will get into the details regarding how this month has gone shortly. But before that I wanted to give a shout out to a new content creator and fellow dividend growth investor, Harris Elliot who shares his investing journey through his podcast, appropriately called, One Penny at a time. I had the privilege of being a guest on his podcast and it turned out to be a great conversation where we talked about several topics ranging from dividend stocks such as JNJ, INTC and HD, to an investing mindset, to assessing the quality of management in businesses. Please do give him a follow and draw inspiration from his journey!
Lets get into the numbers for this month, shall we?
Dividend Income Received
Sl. No.
Company / ETF (ticker)
Amount
1
Aflac (AFL)
$17.72
2
Duke Energy (DUK)
$7.28
3
The Home Depot (HD)
$34.02
4
Intel (INTC)
$12.67
5
Johnson & Johnson (JNJ)
$51.76
6
Lockheed Martin (LMT)
$51.44
7
3M (MMM)
$54.94
8
Microsoft (MSFT)
$37.60
9
NextEra Energy (NEE)
$3.34
10
Pepsi (PEP)
$13.06
11
Snap-On (SNA)
$17.96
12
Southern Co. (SO)
$12.78
13
Target (TGT)
$21.11
14
T Rowe Price (TROW)
$96.73
15
UnitedHealth Group (UNH)
$9.96
16
Visa (V)
$17.49
17
Whirlpool (WHR)
$66.94
18
Waste Management (WM)
$0.72
19
Exxon Mobil (XOM)
$2.87
20
Schwab US Equity Dividend ETF (SCHD)
$51.35
21
Realty Income (O)
$26.12
22
JP Morgan Equity Premium Income ETF (JEPI)
$6.6
23
STAG Industrial (STAG)
$4.03
24
Digital Realty Trust (DLR)
$37.5
Total
$655.99
So a total of 24 stocks contributing to a monthly total of $655.99, thus making it a record-breaking month for my portfolio. This was the first time my portfolio crossed the $600 mark. From a YoY growth perspective, I had earned $375.85 back in Mar 2022. I had earned $68.37 back in Mar 2021. So I am very happy with the way the portfolio is growing at this stage of the journey.
My biggest dividend payer this month was TROW, a stock that has been decimated in the last few months. My conviction here though is that this is a solid business with a strong balance sheet. Their recent acquisition of another fintech startup called Retiree is something that seems like an interesting move and smart use of their cash on hand. And while I still think the stock in the undervalued region, I am happy with my current position size and will not be adding more atleast until I learn from their next couple of quarterly earnings.
I did not earn any income through option premiums.
Buys and Sells during this month
In my last monthly update, I did mention that I was seriously looking into my existing position in DLR and considering what I needed to do with it. After a lot of analysis and research, I decided to sell out of this position completely. I ended up losing money in this investment. And while losing money on any investment sucks, it was worth it from a standpoint of teaching me some very valuable lessons. This business is not what it seems like from the outside. I made some very incorrect assumptions on this one and was suckered into the narrative rather than looking into the fundamentals of this business. There is so much more to say about what makes DLR a tricky business to analyze, but I will leave them for a future post.
I also started a couple of new positions: one of these is Microchip Technology (ticker: MCHP) and the second one is Toronto-Dominion Bank (ticker: TD) in my retirement account. Both deserve deep-dive posts of their own as well, so I will reserve my thoughts for now.
As far as other buys, I continued adding to my positions in JNJ as well as some smaller tranches in UNP. JNJ was in the news recently with its refiling of the bankruptcy protection and also a settlement to pay $9B to resolve the talc powder lawsuits. The market reacted positively to this news, but this is still a developing story and there is a long way to go before this one is settled.
Summary
The first quarter for 2023 is done and dusted. I am happy with the overall progress that my dividend portfolio has made thus far in the face of a some dividend cuts and some disappointing dividend increases.
Thank you for reading thus far and see you all in the next post.
February has come and gone. I have been quiet on the blogging front as most of my family has been under the weather for a major part of this month. If you have lived in Texas, you would have heard a lot of the locals complain about allergies all the time. I didn’t think much of it for the first few years of my stay here. But since the last three years, I have observed the sudden onset of asthma-like symptoms typically around the February and March time frame. Some reading up and voila! Turns out my symptoms are due to pollen from oaks and certain types of grass. I think I and my family are past the worst phase of these allergies and are looking forward to some beautiful spring weather.
Of course, I have been keeping a close eye on the markets and the earnings reports that have been rolling in. 2023 has been a rather busy month as far as dividend hikes. Per a statistic that I read somewhere (sorry, forgot to bookmark the source), there have been almost 200 dividend hike announcements in 2023 in the US, with an average hike of 11.7%. Among these dividend hikes, 76 of these have been double-digit hikes! Wow! Not a bad time to be a dividend growth investor, eh?
I had my share of dividend hikes as well. I received 10% hikes from PEP, HD and NEE. I received a lousy 1.7% dividend hike from TROW. While disappointing, I completely understand the reasoning behind the low hike. Another not-so-surprising lousy hike came from MMM, another 1c dividend hike. O hiked their monthly dividend by 2.4%.
I also received a massive 65% dividend cut from INTC. There is so much to say on this subject, explaining what I intend to do with my position in INTC. I’ll reserve my thoughts for a near-term future post.
Lets get into the numbers for the portfolio did during this last month.
Dividend Income Received
Sl. No.
Company / ETF (ticker)
Amount
1
Apple (AAPL)
$5.08
2
AbbVie (ABBV)
$21.77
3
Albertsons Companies (ACI)
$2.54
4
A.O.Smith (AOS)
$1.20
5
Caterpillar (CAT)
$3.64
6
Clorox (CLX)
$53.32
7
Costco (COST)
$3.62
8
Procter and Gamble (PG)
$23.20
9
Texas Instruments (TXN)
$88.66
10
Verizon (VZ)
$47.96
11
Realty Income (O)
$25.41
12
JP Morgan Equity Premium Income ETF (JEPI)
$5.32
13
STAG Industrial (STAG)
$4.02
Total
$285.74
So a total of $285.74 in terms of monthly dividend income from 13 companies and/or ETFs. At the same time last year, I earned a total of $148.28 in monthly income. In Feb 2021, I earned a total of $12.86 in monthly income. So the YoY growth is appreciable, albeit expected at this stage of the dividend portfolio.
My largest dividend payer for this month has been TXN. TXN has also been in the news, with an announcement earlier this year than the existing CEO, Rich Templeton, will step down on April 1 after a 19-year tenure, and be replaced by Haviv Ilan, the current COO. I looked into the background for Haviv Ilan and was happy to see that he also comes from an engineering background and is also a straight talker, similar to Rich Templeton. It remains to be seen how Haviv will be able to steer this ship in the coming few months.
I also received from my first dividend payment from AOS, a relatively recent addition to my portfolio.
Buys and Sells during this month
No sells during this month.
As far as buys, I continued adding to my position in VZ. While I do not see huge revenue growth in the near future for VZ, the position is serving as a bond-proxy in my portfolio and I could use the output cash flows from this position to fund other positions.
I also added small tranches of JNJ and UNH to my portfolio. JNJ was trading around the $155 mark when I bought my tranche. I am cognizant of the impending litigation risk with JNJ, but there are a few things with JNJ that I need to look into beyond this. JNJ is now slated to be a pure pharma and medical devices company, and I am concerned with the relative softness in their pharma development pipeline. In addition, JNJ has also gone through a recent CEO change and the new CEO is a bit of unknown quantity to me. So I am in wait-and-watch mode on this one as I study their latest annual report and re-evaluate my thesis around this position.
Portfolio Thoughts
After selling out of CHD and DGRO last month, I have been looking at other positions in my portfolio and re-evaluating my investment thesis for these positions.
“This is our big short right now,” Chanos said in an interview with the Financial Times. “The story is that although the cloud is growing, the cloud is their enemy, not their business. Value is accruing to the cloud companies, not the bricks-and-mortar legacy data centers.”
This comment caused me to revisit my thesis and I have to admit that Chanos does have a very valid point. DLR’s FFO has not grown at all over the last few years. A similar trend is seen with Free Cash Flow as well. While the legacy data centers will not go obsolete immediately, this opened my eyes towards the reality that these data center REITs should be viewed as slow-growing mature businesses rather than fast-growers, as one might be led to believe looking at the cloud growth. I will continue doing my research into this business and determine what I need to do next with this holding.
Summary
Feb is in the books and I am looking forward to March which is expected to be a big dividend paying month for my portfolio. While I keep counting the dividend checks, I am also planning to read through a bunch of annual reports.
I recently read through PEP’s annual report and posted my findings in this twitter thread.
$PEP, one of the "core" stocks in my dividend portfolio, recently released their Q4 results. I wanted to dive into their recent annual report to look for some interesting trends.
For this dive, I looked at the period between 2013-2022.
Before ending this post, I wanted to share an interesting passage I read from Berkshire Hathaway’s 2022 Annual Report. Quoting Warren Buffet on his investment in Coke:
“The cash dividend we received from Coke in 1994 was $75 million. By 2022, the dividend had increased to $704 million. Growth occurred every year, just as certain as birthdays.”
As a dividend growth investor, if you ever need reaffirmation regarding if dividends matter, I recommend you read this statement every once in a while 🙂
The first month of 2023 is already in the books! And amidst all of this talk of recession, the market has actually held up pretty well, up by almost a 7% in the last month. However, there was news circling around regarding layoffs in Big Tech. Layoffs are quite disruptive for the impacted workers. Having been through one myself, I know and feel for the affected workers. It can be especially challenging if you are an immigrant and working on a work visa in the US as the regulations for finding work within a stipulated time period are extremely tight. If you or your friends/family have been impacted in the recent layoffs, I send across my best wishes to you and hope that you can come out stronger from this experience.
As for me, my family and I are recovering from a terrible winter storm that hit Texas this last week. While this storm was not as bad as the one from 2020, it was bad nonetheless. Most of the trees around the city and the neighborhood have been wrecked by the storm, stores were low on supplies and major parts of the city were without power for pretty much the whole week. Thankfully, we are now past this and are looking forward to some warmer weather.
Alrighty, there is plenty to talk about as far as this month, so lets get down to the numbers for how the portfolio did in the first month of 2023.
Dividend Income Received
Sl No.
Company / ETF (ticker)
Amount
1
Albertsons Co (ACI)
$144.88 (special dividend)
2
J P Morgan Chase (JPM)
$36.76
3
Pepsi Co (PEP)
$12.98
4
Realty Income (O)
$24.57
5
CareTrust REIT (CTRE)
$6.82
6
Digital Realty Trust (DLR)
$46.72
7
STAG Industrial (STAG)
$3.99
8
Orion Office REIT (ONL)
$0.30
9
JP Morgan Equity Premium Income ETF (JEPI)
$6.82
Total
$283.84
So a total of $283.84 from 9 companies/ETFs. At the same time last year, I had earned a total of $145.60. And back in January 2021, I had earned a total of $13.25. So I am very happy with the YoY growth progress.
Obviously, the stand-out payment for this moment was from ACI. This special dividend was supposed to be paid out back in November last year. Unfortunately, the payment got stalled due to several state AGs appealing against the dividend payment, calling this payment as “illegal”. I have no idea as to what was the central argument for the state AG’s case. I simply cannot understand how a special dividend payment by a company to its shareholders can be illegal. Regardless, common sense has ultimately prevailed and the US courts have rightly thrown this case in the dustbin, exactly where it ought to belong.
Sells during in this month
While my typical holding period for stocks is forever, there are some exceptional cases where I might need to sell out of a given position. I made two such calls during the month of January.
Firstly, I completely sold out of Church and Dwight (ticker: CHD). CHD was an interesting call and one of my bets in the Consumer Staples space. Their brand portfolio is very solid with several strong brands that have withstood the test of time. The macro fundamentals are also sound. However, I had the following concerns:
While their brand portfolio is solid, most of their brands are still “second best” choices for consumers and at a comparable price point to the first choice brands. In this light, atleast over the next few years, I am not actually seeing a growth catalyst. I was hopeful that the management would be able to leverage their brand power and be able to somehow grab market share from the first-choice players. In the two years that I have followed this business, I am not seeing a great evidence of this phenomenon. I can understand that some of the macro-economic conditions have not helped them. But that is the nature of this landscape and unfortunately there are no prizes for runner-ups.
The starting yield is fairly low (1.31% at the time of writing). In order for this to be a meaningful investment, I would need to see some evidence of intent from management for dividend growth. It seems (to me atleast) that the management is not aligned with my objectives on this front, as is evident from the last two dividend increases (low single digit hikes).
I already own Procter & Gamble (ticker: PG) and Clorox (ticker: CLX) in my portfolio, both of whom rank so much higher in terms of a high-quality businesses. I do not need another similar business which is not as high-quality in my portfolio.
My second sell was iShares Dividend Growth ETF (ticker: DGRO). Dividend growth ETFs are interesting investment vehicles for a dividend growth investors. I certainly see the value add as far as a “set it and forget it” strategy. However, I am always skeptical about certain aspects with ETFs in general. At present, I own SCHD which is a very high-quality dividend growth ETF. I also own JEPI which is a good bet in markets that will either trade sideways or downwards. Given these investments, it was hard for me see what exactly was DGRO bringing to the table. Perhaps it gives me exposure to a far larger basket of stocks that both JEPI and SCHD. Also the overlap in weightage across different sectors is not as pronounced. However is this diversification really necessary? I already have enough of my capital invested in broad-market low-cost index funds and ETFs for this reason. Consequently, I decided to close my DGRO position, take my gains and look for better investment opportunities.
Buys during in this month
I initiated a new position in Union Pacific Corp (ticker: UNP). I have been researching this business since November last year and the price entered into an attractive range for me to initiate a position. I have a fairly popular twitter thread where I did a deep-dive on UNP. Take a look if you are interested.
I have been researching $UNP for the last few weeks. Railroads are very under-discussed businesses but are crucial to the US economy.
This is a 150yr+ industry, very capital intensive, and yet with better operating margins than $MSFT and $AAPL 😲
As far as other buys, I continued adding a small tranche to my existing position in Verizon (ticker: VZ). VZ is doing the job of a bond-proxy in my portfolio and in an environment when the market is trading in upward direction due to some craziness, I want to sit on sidelines and keep investing in my bond-proxies.
Option trading
I did not write any new option contracts during this month. However, my existing covered call contract expired on the 20th of January in-the-money. This meant my shares got called away as the option was assigned. While this is not ideal, I am not at all disappointed with this outcome. This was a risk I was willing to take when writing this option contract and I also got to sell my shares at a price of my choosing.
When point that I would like to highlight is that with option trading, I am cultivating a bad habit of frequently checking the market for the stock prices, especially for the asset that is held under the option contract. This is one of the things that I could easily avoid doing with dividend growth investing. Perhaps it is something that I need to train myself to be better at.
Q4 earnings
We are in the midst of the earnings season and I have one eye on the few businesses that are on my “naughty list”. In particular, Intel (ticker: INTC) and 3M (ticker: MMM). Both these businesses reported quarterly results that were bad. INTC, actually, was not bad. It was horrendous!
With both these stocks, I am continuing the hold as these are bets were I have calibrated the percentage allocation based on my risk appetite. Atleast with INTC, I know for a fact that the turn-around story will take atleast until 2024-25 to play out. At that point, I will know if Pat Gelsinger and team have flopped or have managed to turn around this sinking ship. With MMM though, I was utterly disappointed with the tone and attitude of the management during the earnings conference call. And it looks like I am not alone in this regard. I read that one of the larger investors in 3M also fired a warning shot at Mike Roman, the 3M CEO, basically stopping short of asking him to resign.
I am long in all these stocks and I will continue to hold and monitor each of these positions over the next few months.
Summary
If you thought dividend growth investing was easy, boring and mundane, well think again! There was so much happening during this month and we are barely getting started with 2023. I am excited about what is in store in the months ahead and hope to be on the lookout for new buying opportunities as and when they present themselves.
Thank you for reading thus far and keep investing with a margin of safety!
I wish you and your families a Very Happy New Year 2023! Hope this new year brings a lot of joy and happiness to you and you find success in your pursuit towards financial independence, whether that is through dividend growth investing or otherwise. I hope that you had a good winter break and are ready to kick things off for the year ahead.
As for me, I took a well-deserved break from work, from blogging, from social media to spend some time with my family. I know several folks elsewhere in the country had to deal with horrendous weather over the last few weeks. It was not as bad over here in Texas, we had a “hard freeze” advisory for about a week. During this time my family and I were stuck in our home and watching old movies, drinking a lot of hot soup, hot tea etc. Last week, with the weather improving a lot, we decided to drive down to Corpus Christi and spend some time there, playing at the beach, eating some delicious sea-food and basically chilling out.
Here is a photograph from one of our stops at Corpus Christi, Snoopy’s Pier. Some of the best fried jumbo shrimps and Crab-stuffed jalapenos I have eaten in a while, and all that while sitting beside the bay and watching the sunset! What more can you ask for! 🙂
This experience brought an important lesson for me: While I am laser-focused on my journey towards financial independence, I cannot overlook of the fact that no amount of money can replace the moments I can spend with my family right here, right now. I think a lot of the FIRE community can sometimes lose sight of this and end up going too far in their quest for frugality. I understand living a modest lifestyle, but like everything, do it in moderation!
As far as other stuff, I decided to give this blog’s theme a bit of a makeover. It is a new year, so seemed like an opportune time for a new look for the blog.
Well, 2023 is here! But we cannot start the year without discussing the final month of 2022 and how my portfolio performed. Let us get into the numbers then, shall we?
Dividend Income Received
Sl No.
Company / ETF (ticker)
Amount
1
Aflac (AFL)
$16.78
2
Church and Dwight (CHD)
$2.12
3
Duke Energy (DUK)
$5.22
4
Home Depot (HD)
$30.75
5
Intel (INTC)
$11.79
6
Johnson and Johnson (JNJ)
$45.82
7
Lockheed Martin (LMT)
$51.13
8
3M (MMM)
$53.94
9
Microsoft (MSFT)
$32.75
10
NextEra Energy
$2.12
11
Snap-On Inc. (SNA)
$9.79
12
Southern Co (SO)
$11.30
13
Target (TGT)
$18.82
14
T. Rowe Price Group (TROW)
$88.19
15
UnitedHealthCare Group (UNH)
$3.35
16
Visa (V)
$17.45
17
Whirlpool (WHR)
$66.16
18
Waste Management (WM)
$0.66
19
Exxon Mobil (XOM)
$2.85
20
Schwab US Equity Dividend ETF (SCHD)
$50.24
21
Realty Income (O)
$24.43
22
JP Morgan Equity Premium Income ETF (JEPI)
$7.23
23
STAG Industrial (STAG)
$3.97
24
iShares Core Dividend Growth ETF (DGRO)
$7.81
Total
$564.72
So a total of 24 companies and ETFs contributed a grand total of $564.72, making this a record-breaking month for me yet again! My highest payer for this month has been TROW, a stock that has been crushed for the majority of this year. And while a lot of investors have exited their position in TROW, I am holding firm. It is worth noting that during rosier times not that long ago (Jun 2021 to be precise), this company rewarded its shareholders handsomely with a special cash dividend, as a statement of their commitment towards their shareholders. I have not forgotten that and continue to believe that TROW’s strong balance sheet and management quality will see them through turbulent times.
My second highest dividend payer is Whirlpool (WHR), another stock that has been beaten down during 2022 and quite understandably so. However, in this case too, I am confident that the overall quality of the brands under their umbrella and also their recent acquisition of Insinkerator will help in the company navigate the troubling times ahead.
I will go into the overall performance of the portfolio in a little bit. First let me cover all the Buys and Sells I made in December.
Buys and Sells during this month
I did not make any sells during this month. That said, I have shortlisted atleast a couple of positions that I might look to exit out of in the coming few months. I will announce these moves and the reasoning behind those in dedicated posts.
As far as new positions, I recently initiated a position in A.O.Smith (ticker: AOS). I wrote a twitter thread giving a snapshot of my investment thesis and why I like this business.
I recently initiated a position in A.O.Smith (ticker: $AOS). If you have ever looked into purchasing a water heater in the US, there is a good chance that you have run into an AOS product.
In this 🧵, I'll provide a quick snapshot of my research and investment thesis. pic.twitter.com/uGFC5sI3VD
The story behind why I started looking into AOS is interesting. Some of the folks in the US might remember the winter-storm of 2020 here in Texas. This was the time when my family and I were left without food and water for nearly a week. The snow storm had blocked all major highways, there was shortage of gas. To top all that, our gas water heater broke down due to the extreme temperature drop leaving our family without hot water for nearly a month.
As things started to come back to normalcy, I started researching into buying a new water heater. If you have done a similar exercise, you are bound to run into a product from AOS. Along with Rheem, AOS dominates the North America water heater market. This gave me the impetus to start looking into their business model a lot closer and I liked what I saw. Since then I have been waiting for an ideal entry point and researching the business further. I finally pulled the trigger last month.
Portfolio performance
Since this is the last monthly update for the year 2022, I wanted to touch briefly on the performance aspects of the portfolio.
Annual Dividend Income
At the start of 2022, I set out a goal for myself to try and reach $3000 for annual dividend income. Well for 2022, I earned a total of $3,246, thus comfortably beating my goal. If I look at the annual dividend income received for year 2021, I had earned a total of $821. So the YoY growth in quite appreciable! Granted that a lot of this is due to my heavy allocation of capital in 2022, I still think seeing the growth is motivating to keep at this strategy.
Option Income
I earned a total of $257.58. While not a whole lot, I am still new to the option trading scene and it certainly helped me get myself over the annual income goal. That said, I mostly focused this year on selling covered calls often taking advantage of the market swings and option greeks. It is a very risky game overall, and one that I think I need to educate myself further before placing big bets.
Performance vs. Indexes
A common criticism that most retail investors face is why bother with the headache of picking individual stocks when you can simply buy a broad-based low-cost index fund and just perform just like the market. There is some merit to this argument. For instance, if my portfolio was only composed of typical “growth stocks”, it would have been slaughtered in 2022. And so if you are not beating the market, why bother with this strategy? Can’t you simply buy an index fund and chill?
Two issues with that statement:
What benchmark do I compare my portfolio against? SP500? Well is that a fair comparison? My goal with this specific portfolio is to build a passive income stream. If I were to buy an index fund/ETF that tracks SP500, say SPY, which is yielding about 1.62% at the time of writing, this would yield well below what my portfolio is currently yielding (3.2%+)
That said, I still wanted to compare my portfolio’s performance against some indexes for the heck of it. This is a tad difficult to do for my overall portfolio, since I have holdings across several different brokerages. But a majority of my portfolio is under a taxable brokerage account (with Fidelity) and they provide a performance graph for the last year. Here is what the data looks like:
Entry
Returns for Trailing 12 month period
Portfolio Performance (time-weighted)
-8.20%
Portfolio Performance (money-weighted)
-4.81%
SP500 Index
-18.11%
Index Blend 100% Stocks
-18.32%
Index Blend 85% Stocks (taxable bonds)
-17.43%
Dow Jones U.S. Total Stock Market Index
-19.53%
This is not to brag or anything, but the downside protection that my portfolio offered compared to the broader market indexes was massive!! And this is a fairly important point that not a lot of the investing community talk about. A lot of us are hyper focused on returns during a bull market, but everyone tends to go quite (and understandably so) during a bear market situation. Downside protection is just as important as upside potential!
Losers
It has not been all song and dance in my portfolio. I had to exit out of my AT&T position (T) during this year after a rather humbling lesson in the importance of the quality of management when investing in any company. As we head into 2023, I am paying a very close attention to what happens with the lawsuits that MMM is involved with and also the progress in turn-around story with INTC.
Another business and stock that I am closely watching is JPM. They chose to keep their dividend flat and did not announce any increase in 2022 citing “capital allocation challenges”. I am keen on seeing how this story plays out in 2023.
Summary
Whew! If you are still with me and read through this post, thanks for sticking with me! 2022 has been an interesting year, but I am super excited about what 2023 has in store for us. I cannot wait to start looking around for interesting investment opportunities and bargains out there in the market.
How did your December go? Let me know in the comments below!
Hope all of you had a good Thanksgiving break with family and friends.
These last few weeks have been tough for me and my family. And this explains my silence on this blog. Firstly, I had to travel internationally during the early half of November due to a family medical emergency. Dropping everything on the floor, putting a pause on my daily life here and traveling at a moment’s notice is incredibly hard. But family comes first and this is life. And just when I thought things were looking better and I returned back to the States, I contracted the Flu on my return journey and could barely get out of bed for the remainder of November.
Things are now slowly getting back to some semblance of normalcy, just in time for a monthly income update. Hopefully, I should be able to pick up the pace of my posts on this space in the days to come.
So horrible month on the personal front, how did the month go in terms of dividend income earned? Let us find out.
Dividend Income Received
Sl. No.
Company / ETF (ticker)
Amount
1
Apple (AAPL)
$3.69
2
AbbVie (ABBV)
$20.55
3
Albertsons (ACI)
$2.54
4
Caterpillar (CAT)
$3.63
5
Clorox (CLX)
$52.89
6
Costco (COST)
$3.62
7
Procter & Gamble (PG)
$20.33
8
Texas Instruments (TXN)
$88.04
9
Verzion (VZ)
$38.16
10
Realty Income (O)
$24.33
11
JP Morgan Equity Premium Income ETF (JEPI)
$7.13
12
STAG Industrial (STAG)
$3.95
Total
$268.86
So a total of 12 companies/ETFs combined to generate nearly $269 in terms of monthly dividend income. In addition to this, I was also able to earn $74.32 in option premium from a covered call contract I wrote at the start of the month. This brings the grand total to about $343.18 for the month of November. At the same time last year, I had earned roughly $109 in monthly income. So the YoY growth is still appreciable and indicative of the heavy investments I have been making in the portfolio during this period.
TXN, the “boring old calculator company”, was my highest dividend payer this month with an amount of $88.04. I really do not know what is “boring” about this company. Anybody who knows anything about the semiconductor industry will never use the word “boring” to describe it. In any case, in investing atleast, beauty lies in what is considered to be “boring”. Furthermore, TXN is just so much more than a “calculator” company. Not convinced? Please read my deep-dive post on the company to find out more.
As far as overall progress towards my year-end goal, I am still on track to breach the $3000 mark as far as yearly dividend income. December is slated to be a one of my higher paying dividend months, so I should be able to hit this goal comfortably and close the year out on a very high note.
Buys and Sells during this month
Trading activity on the portfolio was at an all-time low given all the stuff that was happening in my personal life. This was probably for the good anyway, as the market during this month seemed to be seeing several green days. This was probably one of the reasons why I was able to secure attractive premiums on the sole covered call contract that I wrote at the start of this month.
I will be looking for more buying opportunities in the last month of this year.
Summary
So the end of an eventful month. How did your month go? Do you hold positions in any one of my dividend payers for this month? Let me know in the comments below.
Wishing you all a very Happy (belated) Halloween! I love this time of the year as it is so nice to see kids running around in their costumes, collecting candy and with no care whatsoever of what the world thinks of them. Considering the times that we are in, with a inflationary macro-economic environment, news about layoffs, the war-like situation in Ukraine continuing to persist etc. it is nice to ignore all that and join these kids in the fun.
We also had several families in our neighborhood celebrate Diwali, the festival of lights, around the last week of October. It was fun to see those families deck their homes with earthen lamps and kids lighting some sparklers and firecrackers.
Speaking of firecrackers, we are in the midst of a very very busy earnings season, and it was very hard to keep up with how all of the companies in my portfolio and some other big names in the industry performed in the last quarter. I am yet to look into the earnings release for Amazon (ticker: AMZN), Meta (ticker: FB) and Google (ticker: GOOGL) but all these stocks got slaughtered after what seemed like some pretty horrendous earnings calls. Among the other big tech names, especially the ones that I hold in this portfolio, Microsoft (ticker: MSFT) is also down near its 52 week-low after its earnings report. In comparison to all these names, Apple (ticker: AAPL) had a rather excellent quarter with revenue growths in its major segments.
It is worth emphasizing that all of these tickers were heading to the moon for the best part of the last two years and, obviously, that is not something that is sustainable in the long-run. So in my opinion, we might be seeing an event where the broader market is coming back to its “senses” and there is a “reversion to the mean”-like occurrence with these stocks.
October was crazy. And as we head into the final two months of the years, I am very excited about the possibility of adding to my core positions when their valuations start entering my “fair value” range. Fingers crossed!
Lets get into the monthly income numbers.
Dividend Income Received
Sl. No.
Company / ETF (ticker)
Amount
1
JP Morgan Chase (JPM)
$34.49
2
Realty Income (O)
$21.76
3
CareTrust REIT (CTRE)
$6.70
4
STAG Industrial (STAG)
$3.94
5
Orion Office REIT (ONL)
$0.30
6
JP Morgan Equity Premium Income ETF (JEPI)
$5.62
Total
$72.81
So a total of 6 companies contributed a total of $72.81 in terms of monthly income. I did not write any new option contracts during this time as the market situation was not conducive to my strategy. At the same time last year, I had earned a total of $26.72. So from a YoY growth perspective, the numbers are pretty attractive again.
Dividend Increasesand other Dividend news
With earnings season, there were also a few companies that were slated to announce their dividend hikes to the quarterly dividend. I enlist a few of these here:
Obviously, I am thrilled with the inflation-beating hikes from Visa and Snap-on. Both these companies reported strong quarterly results, have an incredible management team and are great businesses to own for the long-term investor.
AbbVie had an OKish quarter and also an OKish hike to their dividend. With AbbVie, I am more interested in what new drugs are under development in their pipeline. They have been able to generate solid revenues over the last few years with their super-star drug, Humira. They are hoping to do the same with their two other drugs, Skyrizi and Rinvoq. But beyond that, I would like to see other drugs in their Phase 3 bucket of their development pipeline go through FDA approval. The last update on the pipeline from earlier in the year showed that they have several drugs in the oncology space that are in the Phase 3 cycle.
I’ll be keeping a close eye to look for any updates on their R&D pipeline in this regard.
The other news that made the rounds this month was the merger agreement between Kroger (ticker: KR) and Alberstons companies (ticker: ACI). As an ACI shareholder, I wanted to dive into the details of this agreement and covered it as a part of a twitter thread.
Woke up today to the news that Kroger $KR and Albertsons $ACI are announcing a merger. As an $ACI shareholder, I am keen to dig into the finer points of this agreement. https://t.co/3URmPoMAhi
What was interesting was that as a part of the agreement, the ACI management had decided to pay out its shareholders a special dividend amounting to $6.85/share, payable on Nov. 7th. This announcement, for some vague reasons, did not go down well with the AGs of several states and Sen. Elizabeth Warren, who claimed this dividend payment to be “illegal”. Long story short, the special dividend payment has now been temporarily halted after a restraint order by a Washington state court judge. ACI has since come out with a press-release explaining their stance on the subject.
My take: As an outsider, I can see how the merger agreement can be viewed as anti-competitive. Per the market share data of the major grocery stores in the US (Source: statisca) (discl: data from 2017, but lets assume numbers are close enough for argument sake), we are looking at the #2 and #3 combining here. In some states and remote towns, it would leave consumers with only one option as far as grocery shopping.
Created with GIMP
That said, both KR and ACI seemed to have considered this and have talked about spinning-off a separate company (called “SpinCo”) under ACI’s management as a part of their divestitures.
However, as an ACI shareholde, the opposition to the special dividend payment is something that I do not understand completely. I wanted to dig a little deeper to understand this and I ran into this letter from Sen. Warren. Quoting from the letter:
The “special cash dividend” included in the proposed Kroger-Albertsons acquisition is particularly troublesome because of the adverse impact on long-term competition in this industry. Rather than using these funds to invest in workers, improve stores, reduce prices, or simply strengthen Albertsons’ cash reserve, the $4 billion will go directly to Cerberus and other shareholders – a hit that risks “bankrupt[ing] the debt-ridden supermarket chain.”14
One quick look at the balance sheet and we can see that the even after the special dividend payment of $4 billion, ACI will still have atleast $3 billion in liquidity. One cannot help but wonder what other political motives are at play here behind the scenes. We shall see.
Summary
So a pretty slow month compared to last month when my portfolio breached the $500/month mark for the first time. But I am happy that I am making pretty steady progress towards my overall goals for the year.
It is the start of a new month and that usually means a new entry into the monthly income update post series. To say that this has been a rough month and a year for the markets is a bit of an understatement. That said, if you are a dividend growth investor, you would be absolutely LOVING these market moves. Why? Because you now have an opportunity to either start new positions into companies that were previously richly valued or add to your existing positions at valuations such that the resulting dividend yield and your cumulative yield-on-cost will improve. And if you are not focusing on your portfolio value but instead focusing on your income stream through dividends, you are probably sleeping a lot better at night.
At the risk of sounding like a broken record, THIS is yet another reason why this strategy works for an average Joe like myself. Through dividend growth investing, an investor will naturally gravitate towards the fundamental tenets of successful long-term value investing without even realizing they are doing so.
So how did this month go? Lets find out shall we.
Dividend Income Received
Sl No.
Company / ETF (ticker)
Amount
1
AFLAC (AFL)
$16.67
2
Church and Dwight (CHD)
$2.12
3
Duke Energy (DUK)
$5.17
4
The Home Depot (HD)
$19.22
5
Intel (INTC)
$10.65
6
Johnson and Johnson (JNJ)
$39.89
7
Lockheed Martin (LMT)
$47.41
8
3M (MMM)
$53.94
9
Microsoft (MSFT)
$18.65
10
NextEra Energy (NEE)
$2.16
11
Pepsi Co (PEP)
$11.75
12
Snap-On Inc. (SNA)
$5.71
13
Southern Company (SO)
$11.21
14
Target (TGT)
$14.41
15
T. Rowe Price Group (TROW)
$76.84
16
United Health (UNH)
$3.34
17
Visa (V)
$11.52
18
Whirlpool (WHR)
$56.75
19
Waste Management (WM)
$0.66
20
Exxon Mobil Co (XOM)
$2.73
21
Schwab US Equity Dividend ETF (SCHD)
$39.37
22
iShares Core Dividend Growth ETF (DGRO)
$8.06
23
Realty Income (O)
$16.20
24
Digital Realty Trust (DLR)
$38.91
25
STAG Industrial (STAG)
$3.8
26
JP Morgan Equity Premium Income ETF (JEPI)
$5.05
Total
$522.19
A total of 26 companies + ETFs combined to give me a monthly income of $522.19. This is a record breaking month again as my portfolio breached the $500 mark for the first time since its inception. At the same time last year, I had earned a total of $144.15. I have been investing rather aggressively in the interim as 2022 has provided me with interesting opportunities to either build my existing positions or start new positions.
I did not write any option contracts during this month. Part of the reason was that I have been incredibly busy with my job, thus not having enough time to do a fair value estimate for positions that have been earmarked for the options strategy. That said, the current market scenario does not quite seem to be ideal for my strategy. In an overall bearish market, writing OTM covered calls does not seem attractive from a risk/reward standpoint. Also, writing OTM cash secured puts is challenging because I might end up getting stuck with large bag of shares at a valuation that is probably not the best, since the stock price is dropping. Not at all worth the risk, especially when I am generating enough income for the month through simple dividend growth investing.
My largest payment came from TROW, a stock that has been decimated for the major part of 2022. I view TROW as essentially a proxy to holding the market. So it is not at all surprising to me that the TROW ticker has struggled for the majority of this year. In my opinion, the stock is oversold and is a steal at current values. The fundamentals with this business look solid. Moreover, this company is blessed with a competent management team that has rewarded shareholders with special dividends when times were rosy. Moreover, with companies like Blackrock and T Rowe Price Group, folks with a bearish outlook are essentially betting that people will generally shy away from stock trading altogether in the near long term, a thesis that I certainly do NOT subscribe to.
So what is better than setting a record-breaking month for dividend income? Yes, the news that some of my holdings are increasing their quarterly dividend payment! There were a few noteworthy mentions here:
Microsoft (ticker: MSFT): announced an increase to their quarterly dividend, now amounting to $0.68/share, an increase of nearly 9.7%
Texas Instruments (ticker: TXN): announced an increase to their quarterly dividend, now amounting to $1.24/share, an increase of nearly 8%
Lockheed Martin (ticker: LMT): announced an increase to their quarterly dividend, now amounting to $3.00/share, an increase of nearly 7.14%
Realty Income (ticker: O): announced an increase to their monthly dividend, now amounting to 0.248/share, an increase of nearly 0.2%
In this environment, all pay increases should be celebrated, especially the ones from MSFT, TXN and LMT, which are “in-line with inflation” increases. I thank the hard-working employees and the management at all these corporations for thinking about long-term shareholders such as myself, who are intending to rely on the dividend income from these holdings towards our retirement goals.
Buys and Sells during this month
I did make a couple of sells during this month. Regular readers of this blog might know that my ideal holding time for stocks is forever. That said, if there are compelling reasons to exit a position, I will not hesitate to pull the trigger and sell after much thought and deliberation. I exited out of the following positions:
AT&T (ticker: T) : This investment was a huge mistake and, therefore, also a learning opportunity for me as an investor. When I first invested in this position back in 2020, I was relatively new to dividend growth investing. Like most amateurs, I followed the advice of content creators and did not focus on doing my own research. T was a name that came up quite frequently in most of the discussions around dividend growth investing. At the time, it was a dividend aristocrat, it had a nice juicy yield. My thought process was also clouded in that I viewed this as a conglomerate where they had their tentacles in different types of businesses: they were into media and entertainment, their bread and butter was cellular and they had a decent subscriber base. Also at the back of my head were the following thoughts: Maybe with the COVID pandemic WFH dynamics in 2020, folks would need to rely on their broadband offerings, their streaming business would take off etc. In all of my analysis though, I had not once taken a deeper look at the company fundamentals and its management. And that was it. It was a terrible mistake. There is a lot more to say here, so I will maybe reserve my thoughts for a future post.
Warner Bros & Discover (ticker: WBD): I was assigned WBD shared after T spun-off its Warner Media business and combined that with Discovery to form a new company. In my humble opinion, I really cannot understand how the streaming business can be a long-term profitable venture. These businesses simply cannot build a moat, the barriers to entry for a new large company are relatively small. The consumer “stickiness” is non-existent as consumers can easily move away from one streaming service to another after they have finished watching their favorite shows/movies on one service. Moreover, it is the quality of the content and also the value-add of the subscription service (by combining it with some other services and making it a package, eg. Amazon Prime) that might determine consistent revenues for these businesses. Considering all this, I did not see how WBD fit into my investing philosophy and I certainly could not see myself being a long-term investor in this business.
As far as buys, I used the massive sell-out in tech as an opportunity to add to my positions in MSFT and V. I do not consider the price in the discount territory, but they are in the fair-value range IMHO. I also added to my HD position this month.
In what might seem like a shallow and prolonged recessionary environment, I am going to be looking for opportunities to build up my core positions. These are the times to focus on buying high-quality stocks. Unfortunately, in my opinion, some of the core stocks that I am tracking like JNJ, PG, PEP etc. are holding up quite well even in this environment. PG and PEP are I think overvalued at this point and I would like them to drop some more before buying.
Summary
Another record-breaking month is in the books. Who knows what is in store as far as the economy. What I do know for sure is that those dividend checks are guaranteed to come in every month.
How did your month go? Do you hold any of the stocks from the list above? Let me know in the comments below.
Everything in the world around my family seems expensive, right from buying a some good take-out dinner to shopping for daily groceries to paying for gas. The finance community may argue about whether we are in a recession or not, but one sure sign that something in the economy is not quite right is when you start seeing big companies either announce hiring freezes or announce layoffs. Well, I saw news flashes that both Google and Microsoft were in the process of laying off some of their workforce. That is never good news.
In the midst of all this negativity, the “ka-ching” sound of dividend checks hitting my mailbox is one that will allow me to rest easy. Let us get into the numbers to see how this month went.
Dividend Income Received
Sl. No.
Company / ETF (ticker)
Amount
1
Apple (AAPL)
$2.54
2
AbbVie (ABBV)
$20.34
3
Albertsons (ACI)
$1.21
4
Caterpillar (CAT)
$1.22
5
Clorox (CLX)
$52.46
6
Costco (COST)
$2.71
7
Procter & Gamble (PG)
$12.03
8
AT&T (T)
$1.17
9
Texas Instruments (TXN)
$78.86
10
Verizon (VZ)
$28.7
11
Realty Income (O)
$15.91
12
JP Morgan Equity Premium ETF (JEPI)
$3.48
13
STAG Industrial (STAG)
$3.79
Total
$224.42
So a total of 13 companies/ETFs contributing a total of $224.42 towards the monthly income. I did not write any option contracts for this month, as I was expecting wild swings in the market for the positions where I typically sell covered calls. At this same time last year, I had earned a total of $61.23 in monthly income. While I have been aggressively buying during this year, I have had meaningful increases from most of my dividend payers in the list above, except for T.
Buys and Sells in this month
It was generally a quite month for me as far as investment activity. I don’t know about you guys, but I was struggling to make up my mind about what to buy during this time. I did do some cursory “staying in the game” purchases, especially for positions where I had exceeded a pre-determined threshold since my last buy. This resulted purchasing small tranches in JEPI, PG, SCHD and O. While I was at it, I also decided to add to my VZ position. VZ’s stock dropped after its last earnings report and is currently yielding above 6% in dividends. While I am expecting very slow growth with this telecom giant, I see this as a safe bet and consider this as a good time to add to what is essentially a “bond-like” position in my portfolio.
No sells again during this month.
Even though I was quiet as far as investment activity, I spent most of time deeply contemplating about my MMM position. 3M has been in the news a lot, and that is generally never a good sign for any company. They are being sued by military veterans who claim to have suffered hearing impairment due to the use of faulty earplugs manufactured by Aearo Technologies, a 3M subsidiary. And if that was not bad news as it is, they are also being dragged to court for another lawsuit surrounding harmful chemicals (called PFAS) contaminating ground water.
I think this subject deserves its own post as there is a lot to say here and learn from this experience. So I’ll reserve my thoughts for now.
Summary
We are into the last quarter of the year already! And while work has been hectic, I have been trying to focus some of my time towards my health as well, going out on regular walks/runs, spending some more time looking after my yard etc. It has actually helped me stay away from all the negativity in the news and keep my head space clear.
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