Monthly Income Report – August 2022

Dear Readers,

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
1Apple (AAPL)$2.54
2AbbVie (ABBV)$20.34
3Albertsons (ACI)$1.21
4Caterpillar (CAT)$1.22
5Clorox (CLX)$52.46
6Costco (COST)$2.71
7Procter & Gamble (PG)$12.03
8AT&T (T)$1.17
9Texas Instruments (TXN)$78.86
10Verizon (VZ)$28.7
11Realty Income (O)$15.91
12JP Morgan Equity Premium ETF (JEPI)$3.48
13STAG 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.

Until next time…

Monthly Income Update – July 2022

Dear Readers,

We are almost at the end of the summer and our family is looking forward to the start of the next school season. Work has been incredibly busy. And while all of that was going on, I was keeping a close eye on the earnings reports of certain companies that are on my watchlist. Some of these earnings reports were brutal. Several companies have gone the route of slashing their full year guidance. I also read media reports from Meta and Google that they were freezing hiring for certain positions. There is a lot to talk about as far as Q2 earnings from certain companies, so I will dedicate a separate post for that.

This post though is about my monthly dividend income earned for the month of July 2022. This was expected to be a slow month. How slow? Lets go find out.

Dividend Income Received

Sl. No.Company/ ETF (ticker)Amount
1.JP Morgan Chase (JPM)$32.31
2.Realty Income (O)$15.86
3.JP Morgan Equity Premium Income ETF (JEPI)$4.35
4.Orion Office (ONL)$0.3
5.CareTrust REIT (CTRE)$6.61
6.STAG Industrial (STAG)$3.78
Total$63.21

So a total of 6 companies/ETFs contributed a total of $63.21 in dividend income. The highest contributor was JPM, who in their recent earnings release decided NOT to increase their quarterly dividend. More on this in a future post.

A quick point that I wanted to bring up here: the dividend income I received this month is considerably lower than that of last month. In fact, last month was a record. I know a lot of dividend investors try to spread out their investments such that they can get consistent dividend payments every month of the year. This is not something that concerns me one bit and I do not want factor that it when I choose which company to invest in. I instead choose to focus on high-quality companies that have stable cash flows, thereby ensuring a consistent dividend back to me. These dividends could come in annually, semi-annually or quarterly, it really does not matter at this point. Will it matter once I am in retirement? Maybe. But I am hopeful that by that point the snowball would have grown so much that a slow month really does not matter that much in pure dollar amount.

In any case, to supplement my dividend income for this month, I also wrote a covered call against some stocks, these stock units I earned as part of performance appraisal from my previous employer. I earned another $49.31 in option premium. While I was expecting the supply chain and inflationary pressures to impact the semiconductor industry, I was proved wrong. Intel (INTC) aside, most of the semiconductor companies that I am tracking came out with surprisingly great quarterly earnings results. This also meant that I very nearly got assigned on my covered call (yikes!). Luckily, there was some pull-back late last week. But even if this changes and my covered call gets assigned, I am not too worried as I would be selling these units at what I believe is a good value.

So, my total monthly income from all my investments was a grand total of $112.52. At the same time last year, I had earned $35.63 from my investments. Not bad for what is a slow month, eh?

Buys and Sells during the month

No sells during this month, again.

As far as buys, I decided to small tranches to my JPM position and Snap-On (SNA). It was disappointing to not see a dividend increase announcement from JPM. SNA delivered solid quarterly results once again. Following VZ’s quarterly earnings release, the stock market went crazy and the stock dropped from a cliff. This gave me an opportunity to add more shares at a very attractive dividend yield. VZ and T both suffered similarly as far as stock price, but my take on both companies is very different. This topic truly deserves a post of its own, so I will cover my thoughts there.

Summary

So a slow month, but a steady month. And that is really the mantra of this game we are playing here. Dividend growth investing is NOT a get rich quick strategy. But if you stick with the strategy long enough, the strategy will soon pay its…dividends 😉

Monthly Income Update – June 2002

Dear Readers,

It is that time of the month again. We have yet another month in the books, so it is time for me to write a report on how the month progressed. The stock market saw yet another tough month with a nearly 6.7% drop, including a drop of nearly 9.88% during the week ranging from Jun 7th to Jun 13th. Of course, I did not even know that any of this was transpiring. Why? Simply because I was not even looking at the stock market for most of the month! Work is pretty busy. It is summer time, with my kid not having to go to school. So there is really very little time to do anything else.

So I was actually curious about how my portfolio was faring up in this turmoil. I was mentally prepared to see a LOT of red and the portfolio having gone down in value. And I did see a LOT of red and some of my outstanding buy orders got triggered which made me super happy. What this meant for that I grabbed some very high-quality companies at some very attractive values. And when I then hovered over to the dividends tab in my portfolio, my joy knew no bounds. We will get into the numbers here shortly.

Let me reiterate: THIS is one the best times to be buying as a dividend growth investor. And quite honestly, this is a fantastic environment to be living through to promote my learnings as an investor.

Lets get into the numbers then!

Dividend Income Received

Sl. No.Company / ETF (ticker)Amount
1Aflac (AFL)14.97
2Church & Dwight (CHD)2.11
3Duke (DUK)5.02
4The Home Depot (HD)13.43
5Intel (INTC)7.30
6Johnson & Johnson (JNJ)39.64
7Lockheed Martin (LMT)47.09
83M (MMM)50.45
9Microsoft (MSFT)12.42
10NextEra Energy (NEE)2.15
11Pepsi Co (PEP)11.67
12Snap-On Inc (SNA)4.26
13Southern Co (SO)11.11
14Target (TGT)2.19
15T. Rowe Price Group (TROW)72.51
16UnitedHealth Group (UNH)3.33
17Visa (V)10.01
18Whirlpool Corp. (WHR)49.21
19Waste Management (WM)0.66
20Exxon-Mobil Corp (XOM)2.70
21Schwab US Equity Dividend ETF (SCHD)36.17
22iShares Core Dividend Growth ETF (DGRO)5.50
23Realty Income (O)14.77
24Digital Realty Trust (DLR)38.55
25STAG Industrial (STAG)3.76
26JP Morgan Equity Premium Income ETF (JEPI)2.58
Total$463.56

So a total of 26 companies/ETFs contributing to a total of $463.56 in monthly dividend income. This has been yet another record-breaking month with my monthly dividend income breaching the $400 mark for the first time since its history.

Here is what the overall chart looks like since when I started this portfolio.

So if you look at the year over year comparison compared to last year, where I earned $88.20 in June 2021, this is a massive 370% YoY increase! At a time when the stock market is plunging and in bear-market territory, my portfolio is setting record numbers in terms of earned dividend income. THIS is the power of dividend growth investing and a message to the critics of this strategy. It is the stability and power of dividends that makes this strategy so much attractive to me. And all of this is about as passive as passive can get.

For context, take a look at who is my highest dividend payer for this month. It is our beloved TROW. And while the stock is getting crushed in the current market conditions, I cannot overlook the fact that this has been one of my solid investments as far as dividend income. In good times, management has done their part by rewarding its shareholders with very attractive dividend raises and special dividends. This is yet another learning for me. Remember who your winners are and do not lose faith in them by just looking at the stock price.

Buys and Sells during this month

No sells during this month. This is time to be buying, not selling!!

As far as my big purchases, I continued buying and adding to my TROW position as the stock touched new lows. I also added some more Home Depot (HD), Texas Instruments (TXN) and JPMorgan Chase (JPM). Also added some more Intel (INTC) as it dropped into the late 30s. I did read in the news about the stress tests for banks and how most of the banks passed that. And while a dividend increase from JPM was expected, the management decided against the increase. This was an interesting decision which makes me wonder about the management’s outlook about the near-future economic environment.

I took the opportunity to add into my Target (TGT) position. Other than that, I also added some small tranches to my Apple (AAPL) and Visa (V) positions. In my tax-advantaged accounts, I continued adding to my positions for SCHD, Realty Income (O) and JEPI.

Summary

So there you go! I am pretty happy with the overall performance of my portfolio and I seem to be well on track to achieve the projected annual dividend income goal. I am more convinced than ever about the viability of the dividend income growth strategy and will be sticking with this regardless of the overall market conditions.

Monthly Income Update – May 2022

My dear readers,

The last few weeks have been really tough as far as finding any free time whatsoever towards blogging. As you might be aware, I switched jobs recently and a new job takes a lot of time especially during the initial stages where there is a steep ramp-up. Combine that with family health issues and then the end of the school year and other family activities, summer approaching etc., I have absolutely no free time for anything else. And that is how it should be. Family comes first after all.

That said, I am as strongly committed to my pursuit of financial independence through dividend growth investing as I am to this blog. This blog is very much a part of my investing journey. Which is why come what may, I will find some time to post my monthly income updates. This way, I can atleast make some time to look at my portfolio and see what is going on.

Lets get into the numbers then, shall we.

Dividend Income Received

Sl. No.Company / ETF (ticker)Amount
1.Apple Inc. (AAPL)$2.31
2.AbbVie (ABBV)$20.61
3.Albertsons Inc. (ACI)$1.21
4.Caterpillar (CAT)$1.12
5.Clorox (CLX)$51.19
6.Costco (COST)$2.71
7.Procter & Gamble (PG)$10.15
8.AT&T (T)$1.16
9.Texas Instruments (TXN)$57.77
10.Verizon (VZ)$24.7
11. Realty Income Corp (O)$12.5
12.STAG Industrial (STAG)$3.5
13.JP Morgan Equity Income ETF (JEPI)$1.4
Total$189.88

So a total of 13 companies/ETFs rewarded me a monthly income of $189.88. Among these, TXN was highest dividend income payer, closely followed by CLX. I am very happy with my current percentage position in TXN. I have previously written about why this is one of my core holdings and why I am very bullish. I also made about $49.31 in option trading by writing covered calls. This brought my grand total for monthly income to about $239.19. At the same time last year, I had made about $35.96. So if you look at the YoY growth, this is about a 500%+ increase! Granted that a lot of this growth is due to the volume of my invested capital at this point in my journey. But still…500%+ is pretty staggering.

I added a new position in JEPI in one of my tax-advantaged accounts. JEPI is an actively managed fund that generates income by selling covered call options on large cap stocks. The trailing 12-month distribution yield is about 7.96%, at the time of writing this. I also looked at the top-holdings and the overall fund prospectus and their focus is mostly around the SP500 stocks tending towards low-volatility and that they believe are approaching over-valued territory. At the time of writing this, their top four holdings are Bristol Myers Squibb (BMY), Hershey (HSY), Progressive (PGR) and Coca-Cola (KO), all of which seemed overvalued per my analysis as well. Overall, I liked the exposure of relying on a covered call ETF in my tax-advantaged accounts. This is an interesting exercise, giving the benefits of covered call option trading without having to spend as much time. The high distribution yield is an interesting play in what is a very high inflationary environment. Anyway, we will see how this turns out.

Buys and Sells

There were no sells this month.

As far as buys, there was a lot more activity as my pending buy orders go triggered. Among the big buys, I added to my positions for MSFT, TROW, TXN and JPM. Some smaller “staying in the game” purchases included AFL, V, VZ and TGT. TGT and WMT got slaughtered this month as far as their stock prices after their earnings results. None of this was particularly surprising (to me atleast), because the effects of inflation, the situation in eastern Europe and the lockdowns in China were bound to have their impacts on companies in this sector. TGT, in particular, has been a big beneficiary of the lockdown paradigm for the best part of the last two years. So a reversion to the mean was certainly on the cards. Overall though, I think the business fundamentals are sound and I do not see this company going away soon atleast in my lifetime.

Summary

Yet another month is in the books. I am really hopeful of being more regular with my blog updates. We shall see. Let me know in the comments below as to how is your portfolio doing and how was your May.

See y’all in the next post…

Monthly Income Update – Apr 2022

Dear Readers,

While it has been incredibly hard to make some free time to blog and/or engage with the fintwit community in the last few weeks, I try my best not to miss out on my monthly income updates on this blog.

The monthly income update series is a pretty important component of this blog both for myself as well as readers of this blog. Why? Firstly, it is perhaps the most important (if not the only) metric of my portfolio’s performance. The goal of my portfolio from day 1 has been simply: generating a reliable growing stream of passive income. Too often this aspect is lost on others in the investing community who are hyper-focused on beating the market and capital appreciation. While capital appreciation is important to my portfolio as well, it is not the primary objective. For this reason, I do not even bother sharing the full portfolio value in my performance updates. Lets focus our results on our starting goals and ignore the noise.

Secondly, it serves as motivation for both myself and my readers. This is not a medium to brag about “look how much money I made this month”. Instead, I want to show YOU, the reader, the power of the compounding effect through this investing strategy. And if an average joe like myself can do this, you can do this too!

Lets get into the update then…

April was a brutal month for stocks in general. S&P500 is down by nearly 10% in the last one month alone and several popular growth stocks have been crushed. As far as my portfolio goes, it is not fallen atleast as dramatically as the S&P500 (w.r.t time-weighted return, 6% drop since the start of the year as compared to a nearly 13% drop in S&P500 during the same period).

Dividend Income Received

Sl. No.Company / ETF (ticker)Amount
1.JP Morgan Chase (JPM)$11.11
2.Realty Income Corp (O)$12.22
3.STAG Industrial (STAG)$3.51
4.CareTrust REIT (CTRE)$6.51
5.Orion Office Reit Inc. (ONL)$0.30
Total$33.65

So a total of 5 companies contributing a grand total of $33.65 for the month in terms of dividend income. If you are wondering and have some thoughts along the lines of “why the heck is this guy going nuts over 33 bucks for? That’s hardly going to cover any expenses!”, just bear with me for a second. Firstly, this is 33 bucks that I did not have have before and something which I earned while I was focusing on my life and day-job. Secondly, at the same time last year, I had made $12.59 in monthly dividend income. Granted that I have invested capital in these stocks in the during this time, but some of these stocks have also raised this dividends by a certain percentage to add to this income. The year-over-year increase is around 167%!! Not bad for something that I did not even lift a finger for, eh?

Also, some of these contributions have just happened organically i.e. take ONL for instance. This is not a REIT that I had originally invested in, but rather was a product of a spin-off from Realty Income late last year. I simply just held onto the shares I received from the spin-off.

I decided to not trade options during this month again. Firstly, my mental bandwidth was exhausted due to some family health issues recently. Secondly, the downward trend in the overall stock market and the potential positions where I could write some covered calls meant that my asking price for an OTM option call contract was going to be that much lower. It also turns out to be the earnings season, and there is generally a lot of volatility in price action closer to earnings release. I decided to pass on this for this month atleast.

Buys and Sells during this month

Trading was very very minimal during this time, what with all the health issues in my family. There were no sells, because nothing had fundamentally changed with any of my holdings to warrant such a move.

As far as Buys, I added slightly large tranches to my following positions: JPM, WHR, TROW.

All of the above seemed to be trading near (or below) my fair value estimates. TROW has been absolutely hammered in 2022. I have a pretty sizeable position this holding and I will continue to hold while keeping a close eye on the next earnings release to see the management’s discussion of the results.

As far as smaller tranches, I also added some PEP, PG and HD. Among the three, HD seemed reasonably valued while PEP and PG were my “Staying in the game” purchases i.e. purchases which I had to make for my core holdings after a fixed time limit per my investing strategy.

IRAs

This seemed like a good time to max out both mine and my spouse’s IRAs. The downward trend in the market presented a good opportunity to invest in a broad-market index fund that I hold in my IRA. This is something that I ensure I complete during the early half of the year, as a result of which I can keep any remaining capital for investing in my individual brokerage account. I want to stress that as far as priorities, maxing out my 401(K), HSA and then IRA accounts are much much more higher priority for me than investing in any individual brokerage account. It is just a matter of discipline and ensuring that I invest in my retirement accounts first before investing in anything else.

Summary

Another month is in the books. This has been a roller-coaster of a month for me with starting a new job and also dealing with family health issues at the same time. Here is hoping for a better month up ahead!

See you all in the next post. Until then…

Monthly Income Update – Mar 2022

My dear readers,

Hope you are all doing well, staying healthy and staying invested in your own future. Unfortunately, the situation in Eastern Europe continues to remain volatile and this has had its impact on the markets world-wide. My own personal life is also going through some interesting changes as I discussed in my previous post.

At the risk of sounding like a broken record, I will restate again that dividend growth investing as a strategy has been incredibly helpful during these turbulent times. Its truly passive nature is a huge blessing. I have not been checking on my portfolio and it is mostly in “auto-pilot” this whole time. What is amazing is that while my portfolio has been in this hands-off mode, it has generated a record amount as far as dividend income since its inception!

Let us get into the numbers to emphasize this point.

Dividend Income Received

Sl. No.Company / ETF (ticker)Amount
1.AFLAC Inc. (AFL)$14.48
2.Church and Dwight Co. (CHD)$2.11
3.Duke Energy (DUK)$4.97
4.The Home Depot (HD)$9.58
5. Intel Corp. (INTC)$3.65
6. Johnson and Johnson (JNJ)$36.25
7.Lockheed Martin (LMT)$46.80
8. 3M (MMM)$48.46
9.Microsoft (MSFT)$6.83
10.NextEra Energy (NEE)$1.71
11.Pepsi Co. (PEP)$8.70
12.Snap-On Inc. (SNA)$4.26
13.The Southern Co. (SO)$10.67
14.Target (TGT)$2.18
15. T. Rowe Price Group (TROW)$57.66
16.UnitedHealth (UNH)$2.92
17.Visa (V)$9.61
18. Whirlpool Corp. (WHR)$22.75
19.Waste Management (WM)$0.66
20. Exxon Mobil (XOM)$2.68
21.Schwab’s US Dividend Equity ETF (SCHD)$23.34
22.iShares Core Dividend Growth ETF (DGRO)$5.85
23.Realty Income Corp. (O)$11.66
24.Digital Realty Trust (DLR)$34.59
25.STAG Industrial (STAG)$3.48
Total$375.85

So, a total of 25 companies/ETFs contributed a grand total of $375.85 in terms of total monthly income. This is the first time my portfolio breached the $300 mark since its inception, making it a a new record. At the same time last year, I had earned $68.37 in total monthly income. The YoY growth is nearly over 5x and it is mostly due to the diligent and rather aggressive investment of capital into this portfolio. My largest payment came through TROW, which is something that I have been investing into pretty aggressively since the start of the year. The stock itself has plummeted from it highs back in December and I was seeing so discernable change in fundamentals.

So far, in this quarter, I have earned a total of $669.73 in terms of dividend income. At the same time last year, my total quarterly dividend income was $94.48. So even the quarter-over-quarter performance is truly impressive.

As far as my projections for the rest of the year, I am expecting to be averaging around the $250 mark in terms of monthly dividend income. Fingers crossed, I am looking in good shape to hit the $3000+ mark of earned dividend income for the year, which is one of my goals for this year.

This was expected to be a “heavy-paying” month in terms of dividend income. I am expecting April to be a LOT more quieter in terms of that metric. I am planning on writing some options to boost my income. This is, of course, time-permitting and if the market conditions are conducive.

Buys and Sells during this month

Like I said before, this was a busy month on the personal front. So trades were limited.

I continued adding small tranches to my existing position for TROW. The other stock that was in my radar was WHR. While there have been no telling changes in fundamentals, I think Mr. Market is probably thinking that inflationary pressures are going to have a bigger impact on WHR’s performance especially in Asia and other world markets. While there is some grain of truth in this sentiment, the reaction is a little over-the-top IMHO. Good buying opportunity for me as the starting yield looks very attractive, dividend is relatively safe and the stock is relatively cheap.

AT&T (T) was in the news during the month with the CEO elaborating about the previously announced plans for spin-off involving Discovery and WarnerMedia and also about the dividend cut. T has been one of my worst investments and a stock I wished I had never owned. This was something that I had purchased during my initial days as a dividend growth investor and I made the rookie mistake of chasing the yield and also believing the hype around “oh this is conglomerate and look at how many businesses they own etc.”. This was my stupidity, because one quick look at their balance sheet and the quality of the management would have told me that this is a bad investment decision. Thankfully, because of a categorized dividend growth portfolio strategy, I have safeguards in place against my own stupidity. I have placed T in the “speculative” category of my portfolio and, therefore, only invested a limited amount of capital in them. I will continue to hold this stock for now. However, I have actually no interest in the newly formed spin-off and also holding T as a pure telecom play, as I already hold Verizon (VZ) and I think they are a much better player in the telecom space as compared to T. More on this in a future post.

I continued adding to my position in DLR as this was still attractively priced. I am using every opportunity to dollar-cost average into two ETFs, SCHD and DGRO. Both these ETFs have performed pretty well and give me a good mix of attractive dividend-paying companies. I hold these ETFs and REITs in my tax-advantaged accounts (HSA and ROTH IRA). Investing in ETFs in this account helps me not have to track these accounts as far as individual stock positions (except REITs).

Watchlist

I am taking a serious look at JP Morgan Chase (JPM) and The Home Depot (HD). JPM stock has been on a steady decline since the start of the year, dropping nearly 22% in this period. A quick look at the Price-to-Tangible Book Value seemed bring this into my radar where the price starts looking attractive. I did not see any significant change in fundamentals, but then this is only a cursory look. Will need to dive deeper.

HD still seems to be hovering closer to my estimated fair value and I continue to dollar-cost-average, adding small tranches whenever an opportunity presents itself.

Summary

So another record-breaking month is in the books. I do hope to get a bit more active on the blog and Twitter in the coming few months (fingers crossed).

Take care and see you in the next post..

Monthly Income Update – February 2022

Time for a monthly dividend income update post. Before I start though, I wanted to drop a note regarding the current situation in Eastern Europe. It is difficult to remain focused and talk about things like personal finance and related topics when there is so much turmoil due to a war-like situation. My prayers are with the people of Ukraine and I hope that sanity prevails.

As far as my life, things are extremely hectic. Work is busy as usual, but our family has a whole are busy during the week with various activities. While all of this is going on, I have not even been paying any attention to the market. In fact, preparing for this blog post forced me to open my portfolio and see what was going on! No surprises there, no drastic drops etc.

Lets dive right into the update then.

Dividend Income Received

Sl No.Company / ETF (ticker)Amount
1.Apple (AAPL)$2.20
2. AbbVie (ABBV)$19.96
3.Albertsons Co. (ACI)$1.20
4.Caterpillar (CAT)$1.12
5.Clorox (CLX)$40.42
6.Procter & Gamble (PG)$8.74
7.AT&T (T)$2.12
8.Texas Instruments (TXN)$34.55
9.Verizon (VZ)$23.13
10.Realty Income (O)$11.37
11. STAG Industrial (STAG)$3.47
Total$148.28

So a total of 11 companies contributing to the final monthly income of $148.28. At the same time last year, I earned a grand total of $12.86. So that represents an YoY increase of nearly 1053%! While that is great, I do realize that such growth is expected at this relatively early stage of my dividend growth journey. I am also trying to track the percentage of my dividend income earned through shares bought via DRIP strategy (i.e. purely organic growth as opposed growth through the capital I am investing). Unfortunately, it is a little tricky since I was initially using M1 Finance as a brokerage early last year which does not have a traditional DRIP service available like with the big-house brokerages like Fidelity (my current brokerage) or Schwab. M1 uses a pooled-dividend strategy. It is something that I need to put some further thought.

My largest dividend payment came through Clorox closely followed by Texas Instruments. Both are top-tier companies in the my portfolio allocation strategy. I am especially interested in Texas Instruments at present, especially considering the situation in Eastern Europe and its impact on the semiconductor industry.

Buys and Sells

No sell activity during this period.

As far as buys, I added to my following existing holdings: Texas Instruments, T Rowe Price Group and Whirlpool. These were larger tranches weighted in accordance to the category of the portfolio.

I also add a smaller tranche of Clorox, mostly because I believe in this business and the quality of the products. I think the dividend is safe and I do not see this company going away soon, atleast in my life-time. The other company that I was tempted to buy but resisted was 3M (ticker: MMM). With this one, while the current dividend is safe and the stock is attractively priced, I am not sure about the growth prospects in the near term. I am also paying close attention to how the management is going to wade the company through these troubled waters in the next couple of years. This will go a long way in terms of my belief in the company and its overall growth prospects. So far, it has been a mixed bag and hence I am circumspect.

Summary

Another month is in the books. I am chugging along in my dividend growth investing journey and staying invested even in these turbulent times in the market. What about you? How did your month go? Are any of the companies listed above in your portfolio as well? What are your thoughts? Please drop a comment and let me know.

Monthly Income Update – January 2022

My fellow investor friends and readers, I have been on radio silence for the last couple of weeks. There are a couple of reasons. My extended family were continuing to grapple with some health issues which are now, thankfully, progressing well towards recovery. The second reason is weather. My nick of the woods has experienced a couple of winter storms in the last few weeks. The more recent one resulted in school closures, power outages etc. The city that I currently stay at does not typically see this kind of weather. When we had a similar winter storm last year, we saw record snowfall, something which the city has not seen in over 100 years. To give you some idea as to how bad the situation was: last year’s winter storm left me and my family without drinking water and power for nearly 4-5 days. Roads were blocked due to heavy snowfall, grocery stores were short on stocks because people were panic-buying and there was no gas at the gas stations because of lack of supply. The winter storm also destroyed my gas water heater and I had a cracked window. Several houses in the neighborhood were without water even after supply was restored because of burst water pipes on the outside of the homes due to winter freeze.

All of this was a nightmarish experience. So this time around we were well-prepared and thankfully able to weather the storm much better.

And while all of this was going on, January was seeing some crazy market swings with the S&P500 dipping the most since March of 2020 when news of the pandemic first hit us. The high-flying growth stocks, especially in the tech sector, were getting crucified. We are also in the midst of an earnings season, with so much activity around some of the holdings in my portfolio. I am yet to digest all of this, but initial quick readings show that my holdings are doing just fine.

While I was briefly on Twitter, I was seeing several folks with tweets that could be summarized as “the market has gone red, BUY THE DIP!”. So naturally, I took the opportunity to quickly scan my portfolio and see if there were any such opportunities. And while there were some interesting opportunities, it was certainly not the “market crash like” moment that it was being touted as. I really enjoy interacting with fellow investor folks on Twitter, but honestly, there are also times when I find logging on Twitter to be incredibly distracting and sometimes downright annoying.

Here is an example of a tweet:

I get the need to want to “engage with the fintwit community”, building your follower base, and wanting to show that you are active etc. but honestly what is the point of tweets such as these? And we keep seeing these over and over and over again from multiple folks. It can be mind-numbing at times..

Ok where was I? Oh yes….this is supposed to be a monthly income update, and the first one of the year! So lets get right into it.

Dividend Income Received

Company/ETF (ticker)Amount
1.Pepsi Co. (PEP)$8.65
2.JP Morgan Chase (JPM)$9.05
3.Realty Income (O)$11.33
4.CareTrust REIT (CTRE)$6.2
5.Digital Realty (DLR)$22.29
6.STAG Industrial (STAG)$3.44
Total$60.96

So a total of $60.96 earned through dividends this month, with DLR being the highest contributor. In addition to this, I also earned an additional income of $84.64 through options trading by selling covered calls on stock that I had earned through RSUs through my employer. This puts the grand total of income through investments at $145.60. My income received from January of 2021 was $13.25. So this is some appreciable YoY growth.

Buys/Sells during this month

Since it is the first month of the new year, a large portion of my available capital went towards funding my retirement accounts i.e. mine and my wife’s Roth IRAs. I am already setup to also max out my health savings account and 401(k) accounts at this time. The remaining capital was deployed towards the following buys:

  • TROW : T Rowe Price Group saw an appreciable stock price drop during this last month. If we extend this time frame to the last 6 months, the stock has dropped by almost 30%. What is interesting is that none of the fundamentals, AFAICT, have changed. The earnings were decent and assets under management continues to grow. I will gladly accept what Mr. Market is offering right now.
  • Small tranches of MSFT, V and TXN: During mid-January, when pretty much all tech stocks were being crushed, MSFT dropped below $280. While this was no-where near my estimated fair value, I took this opportunity to add to my position. This is a phenomenal company and I am prepared to buy it at these prices. Similar story with Visa. All that nonsense of Amazon stopping to accept Visa credit cards in UK, created a fantastic buying opportunity back in Dec(?) of 2021. And while everyone was focusing on MSFT and its proposed acquisition of Activission Blizzard (ticker: ATVI), Texas Instruments (ticker: TXN) delivered another stellar quarter with double-digit growth.

Watchlist

I am taking a serious look at MMM and CLX. CLX delivered an underwhelming quarter, which drop in margins and a bleak outlook. The stock has dropped by almost 12% post its earnings release. None of this was particularly surprising. Inflation was bound to take its toll and also all the momentum gained during the pandemic is now vanishing as expected. However, this remains a solid business with superior brands that are not going to go away anytime soon.

Then we come to MMM, which was hit with a $110 mill federal jury verdict over its allegedly faulty CAEv2 earplugs. The stock plunged as a result. While this is indeed worrying news in the short-term, I am not as concerned about the company itself from a long-term perspective.

Summary

So another month is in the books. And if this month is any indication, we might be in for a volatile ride in the coming few months. Exciting times! 😀

Monthly Income Update – December 2021

First up, I want to wish all my readers a very Happy and Prosperous New Year! I hope you are looking forward to achieving your goals for the upcoming year and chalking out your own path towards financial independence. I am very excited about the upcoming year and I have a lot of plans about things to learn to further my education as a dividend growth investor. This blog is going to be a large part of this journey and I hope to use it as a medium to share and learn with all of you.

2021 was a great year in terms of my progress as a dividend growth investor, but it was mentally and emotionally draining for me and my family. The early part of the year saw non-COVID related health issues resulting in hospital visits for some of my extended family members. We had to travel out of the country due to an emergency, and had to travel back later just when the Delta-variant was peaking. December saw another such non-COVID health issue resulting in another hospital visit with some other extended family member, this time during another COVID variant at its peak (Omicron).

Thankfully, things are getting back some kind of normalcy. But the whole of last year has been a reminder regarding the importance of health and how fickle life can be.

Anyway, let us talk about something positive. This is supposed to be a monthly income update post, after all. And no better way to close the books on 2021 than to report the dividends earned during the final month of the year.

Dividend Income Received

Company/ETF (ticker)Amount
1.Aflac Inc. (AFL)$11.22
2.Church and Dwight (CHD)$2.02
3.Duke Energy (DUK)$4.93
4.The Home Depot (HD)$8.28
5.Johnson and Johnson (JNJ)$31.80
6.Lockheed Martin (LMT)$46.42
7.3M (MMM)$28.12
8.Microsoft (MSFT)$4.96
9.NextEra Energy (NEE)$1.55
10.The Southern Company (SO)$10.56
11.Target (TGT)$2.17
12.T Rowe Price Group (TROW)$5.96
13.UnitedHealth Care (UNH)$2.91
14.Visa (V)$2.25
15.ExxonMobil (XOM)$2.64
16.Realty Income (O)$10.78
17.STAG Industrial (STAG)$3.31
18.Schwab US Dividend Equity ETF (SCHD)$26.50
19.iShares Core Dividend Growth ETF (DGRO)$5.75
Total$212.13

So a total of 19 contributors to dividend income generated $212.13, a record number for my portfolio. My monthly dividend income from Dec. 2020 was about $20.14. As one can see, the YoY dividend income has grown by 10x, which is quite staggering! LMT was the largest dividend payer this month, not surprising because I heavily bought this during the last few months.

It is important to highlight this once again: this was $212.13 for which I did not even have to lift a finger. My only contribution was some upfront research in high quality companies, purchasing them at reasonable values and then ignoring all the other noise either because they will cloud my judgement or because I simply do not have the time to follow the noise (aka “news”). My goal with sharing this information is not to brag about my progress, but rather to motivate you by demonstrating the power of this strategy.

At this stage of my dividend investment journey, the growth is very much due to capital being invested from my end, rather than organic growth due to dividend increases. But based on my future projections and my conviction in the companies I am invested in, I am well on track to see the dividend snowball take effect in a few years from now.

Buys/Sells during this month

As I stated earlier, this month was emotionally draining due to family members and their health issues. I did not have time to even look at my portfolio during this time. Any remaining free time was reserved for the family in holiday activities and some much needed cheer for all of us.

During the early part of the month, I did add to my MMM position, as that was the only stock I could find at a reasonable value at that time. All the other transactions where DRIPs.

No sells during this month.

Summary

So that is a wrap on 2021. It has been a rollercoaster of an year, but I am very hopeful and excited about the upcoming year.

I will end this post with some friendly advice: spend as much time as you can with your loved ones i.e. your family and friends. Life is short and any moments you have together are just priceless and irreplaceable.

My best wishes to all of you. Take care. Stay safe and healthy!

Monthly Income Update – November 2021

We are almost at the doorstep of a new year and I am waking up to the nice fall color hues thanks to the two red oak trees in my backyard. Some nice hot tea after breakfast and counting all the dividend checks I have received this month…what more can I ask for! 🙂

I am very thankful to have a loving and caring family, a stable and well-paying job and a lovely community of friends around me.

Dividend Income Received

Company/ETF (ticker)Amount
1.Apple (AAPL)$2.20
2.AbbVie (ABBV)$18.20
3.Albertsons Companies (ACI)$0.84
4. Caterpillar (CAT)$1.11
5.Clorox (CLX)$38.98
6. Costco (COST)$2.37
7.Procter & Gamble (PG)$7.83
8.AT&T (T)$2.08
9.Texas Instruments (TXN)$8.05
10.Verizon (VZ)$14.63
11.Realty Income (O)$9.83
12.STAG Industrial (STAG)$3.30
Total$109.42

So a grand total of $109.42 for this month from a total of 12 companies. At the same time last year, I had earned a whopping total of $9.37. The YoY growth in monthly dividend income is staggering. The key here is that this was $109.42 that I earned passively by simply choosing to invest in high-quality companies, while I focus on my daily 9-5 job and family responsibilities. This is the power of dividend growth investing and why it is the ideal strategy for my specific situation.

Buys/Sells during this month

As always, there is never a dull moment in the world of finance. During this month, news regarding the Omicron COVID variant broke out and that triggered a mini sell-off. Then there the news regarding President Biden’s move to reappoint Jerome Powell as the Fed chair and then the latter’s bizarre statement regarding his previous stated position on “inflation being transitory” and how he now wanted to retire the word “transitory” when describing inflation. Huh?

While all of this was causing movements in the markets, I was simply keeping an eye on any opportunities to buy. Among the opportunities, I added to my Visa (ticker: V) position. There was a slump in the stock price thanks to Amazon UK’s announcement that they will not be accepting payments made through Visa credit card. Fintech, in general, was getting hammered with similar slumps in stock price for Mastercard (ticker: MA), Paypal (ticker: PYPL) etc.

I also used the opportunity to add to my positions for Johnson and Johnson, 3M and Verizon as they had creeped below my cost basis.

Big Buys: V, JNJ, MMM, VZ

“Staying in the game” purchases: AFL, PG, PEP.

The “staying in the game” purchases are simply dollar-cost averaging into the stocks since the threshold for number of days since the last purchase made had expired (threshold configurable based on the category of the holding in my spreadsheet setup). The tranche size is dependent on the current valuation of the stock in question (i.e. smaller tranche size for an overvalued stock).

I had no sells during this month.

Summary

So there you go, another month is in the books and we are all getting ready to bid 2021 adieu and welcome 2022. Hopefully this new year will bring us good news as far as dealing with this pandemic is concerned.

I wish all my readers here a very happy holiday season. Here is wishing you in advance a Merry Christmas and a very Happy New Year!

Stay safe and healthy!

PS: You can now also connect with me on Twitter @LifeWDividends.