Tuesday, January 15, 2019

Review of 2018 Goals

It's official! 2018 is in the books and 2019 has arrived. With that said, I thought I'd take the opportunity to reflect on the past year of goals and how I fared on my mission to achieve them.




Goal #1: Collect $350+ in dividends

Overall, I ended up collecting achieving my goal of collecting at least $350 in dividends, collecting $360.92 in dividends in 2018. Of the $360.92, I received $314.76 or 87.2% from my Robinhood portfolio. $46.16 or 12.7% originated from my retirement account, paid by my mutual fund (CAIBX). The remaining $0.96 came from my M1 Finance account that I opened in September 2018. I also ended the year with just over $470 of forward annual dividends heading into 2019. That is compared to the $186 heading into 2018, which represents a 152.9% YOY increase in forward annual dividends.

Goal #2: Reach $11,000 portfolio

Overall, my portfolio reached a peak value of roughly $10,550 for the year on December 2. This was well short of my goal, but a December that was on track for the worst December since the Great Depression until the last week or so of the trading year certainly wasn't helpful to achieving this particular goal, as I finished the year with investments worth just over $10,000. However, the great news that came out of this was that I was able to average down on my Altria position twice and recently add to my Iron Mountain position, further solidifying my forward dividend income of $470 to end 2018 and begin 2019.

Conclusion:

My goals for 2018 were fairly non-existent as I started this blog in July and honestly didn't really hold myself accountable with specific or actionable financial goals before starting this blog, aside from simply graduating college with no debt. I believe I set my goals realistically. Rather than being overly aggressive or not aggressive enough, I just barely achieved my first goal of collecting $350 in dividends. Although I fell short of achieving $11,000 in portfolio value, this was in large part because of the worst December since the Great Depression. My mindset is that if you're achieving all your goals, you aren't setting the bar high enough. Similarly, if you're achieving none of your goals, you're probably setting them too high. I have also been planning my goals for 2019 the past week, which will be the topic of next week's article.

Discussion:

What were your goals for 2018? Did you achieve them all? If so, did they end up being too easy to achieve or did you have to give it your all to achieve them?

Tuesday, January 8, 2019

December 2018 Dividend Income

Another month has passed and we have officially entered 2019! It really is unbelievable how quickly the year has passed us by, especially in my case. Working and blogging has kept me busy, and with school set to resume in a couple weeks, 2019 will no doubt be a busy year. Anyways, with the passage of another month, it's time for me to delve into what December provided for me in terms of dividends.





Analysis:

Overall, I collected a record $53.86 in dividends in the month of December. This represents a 21.7% growth in dividends collected compared to the $44.26 in dividends collected in September. 

This means that in 2018, I collected $360.92 in dividends between my taxable accounts and my retirement account. Of the $53.86, I received $29.87 in dividends from 12 of the 32 companies in my Robinhood portfolio. This is less than the $31.73 I received from my Robinhood portfolio in September as Pepsi (PEP) won't be paying their dividend until January.

The amount received from my Robinhood portfolio is identical to September's dividend income besides the absence of the Pepsi dividend that was discussed above, as I have received no dividend raises and invested no new capital in any companies that paid me in December.

I also received a record $0.44 from 24 companies in my M1 Finance portfolio. I haven't added any new capital to my M1 Finance portfolio since I opened it back in September, so the dividends will continue to be a rather small percentage of my total dividends. I didn't include screenshots for M1 Finance, as the dividends have been grouped together, rather than separated out in an even somewhat orderly manner.

Lastly, my mutual fund (CAIBX) in my retirement account paid a record $23.55 in dividends, with $5.15 of that being special, year-end dividends. The retirement account dividends increasing have been the constant for the end of quarter dividend income reports. Factoring out the special dividend, the $18.40 in usual dividends that I received in December compared to the $12.49 received in September represents 47.3% quarterly growth.

However, the most impressive growth can be observed when we compare December 2017 dividends of $12.80 to the $53.86 collected in December 2018. A 320.8% YOY increase that was mostly as a result of my retirement plan contributions in 2018. A quadrupling of dividend income in a single year! Sign me up for that!

Summary:

December was yet another month of considerable dividend growth. I expect this trend to continue throughout the year for every month of dividends, with end of quarter months containing the most growth due to retirement contributions. The real fun will begin in 2020 when I am several months removed from completing undergrad and will finally be able to aggressively funnel most of my earnings into investments.

Discussion:

Was December another record month for you? Did you have any new dividend payers?

Tuesday, January 1, 2019

Recent Stock Purchases - Altria Group (MO) & Iron Mountain (IRM)

On the day this post is set to be published, 2018 will officially be over and we will have entered into 2019. With that said, I didn't go quietly into the New Year! I made two final purchases in 2018, adding to my stake in Altria Group while also lowering my cost basis from $60.35/share to $58.43/share, and I also added to my position in Iron Mountain. Below are my screenshots of the transactions:




I won't go into too much detail in my rationale for initiating these purchases, thereby expanding my positions in Altria and Iron Mountain. My first Seeking Alpha piece fully hashes out why I believe Altria is currently an attractive investment. In short, the company's dividend is the highest it has been in years, I have confidence in the company and its ability to transform itself for the next half century of dividend increases, and I also detail the appealing current valuation.

As for Iron Mountain, I wrote a brief overview of why I initiated a position in it back in October.  Since that time, the company announced a respectable 4% dividend increase. Overall, the company has delivered on my investment thesis since I initiated the position and rewarded me with an inflation beating dividend increase. The valuation was also attractive as my cost basis of $32.03 on the previous 3 shares I owned, only increased to a cost basis of $32.09 with the addition of the 4th share. I'd like to continue to add to my Iron Mountain position as long as the price stays in the low to mid $30s, unless other more attractive buying opportunities present themselves.

Summary:

Overall, these two small purchases increased my forward annual dividends by $5.64. I deployed $81.04 in capital to my Robinhood account, at an average dividend yield of 6.96%. Factoring in my retirement contribution on the same day, that places my dividends going into 2019 at just over $470! This will also continue to help me make progress in balancing out my dividend income as both Altria and Iron Mountain pay dividends in the first month of the quarter, which has historically been my weakest month since the inception of the portfolio in September 2017.

Discussion:

Have you added either of the two names mentioned above? Or have you been adding other names? If so, what did you purchase in the last days/weeks of 2018?

Tuesday, December 25, 2018

Expected Dividend Increases for January 2019

The last week of 2018 is officially upon us. With that said, the month is drawing to a close. That means it's time to examine the next month of dividend increases. Prior to discussing the next month of dividend increases, I'll recap the dividend increases that we received in December. With a week left in the month and year, I don't expect any additional dividend increases. However, if any others are announced within my portfolio, I will revise this article. 


December was quite the month for dividend increases. It was easily the busiest month of dividend increases that I have had since I began investing back in September 2017. Of the seven increases that I received this month, I received 3 of them on the same day in PFE, D, and T. The six companies that I predicted would raise their dividends in December did just that. Most increases were about what I expected. However, the real surprise was an increase from one of my holdings that typically increases in dividend in January. I received raises from the following companies:

December Dividend Increases:

Increase #1: Realty Income (O)

Realty Income announced a 0.2% dividend increase from a monthly dividend of $0.2205/share to $0.2210/share. Overall, this raise was in line with what I predicted in my expected dividend increases for December 2018 article. This dividend increase of $0.006 a year resulted in an increase of $0.024 in my annual forward dividends across my 4 shares.

Increase #2: WP Carey (WPC)

WP Carey announced a 0.5% dividend increase from a quarterly dividend of $1.025/share to $1.03/share. Similar to Realty Income, WP Carey raised its dividend by the amount that I was expecting. This increased my annual forward dividends by $0.06 across my 3 shares.

Increase #3: Ventas (VTR)

Ventas announced a 0.3% dividend increase from a quarterly dividend of $0.79/share to $0.7925/share. This dividend increase was well below the 1.9% increase that I was expecting. I'm slightly disappointed by this increase, but quite honestly, an increase is an increase. For every high yielding, low growth stock in my dividend portfolio, I have other stocks to make up for small increases such as Ventas's. That is essentially why we diversify. I don't expect massive raises from a company such as Ventas. Perhaps I should have adjusted my expectations a bit knowing that the industry is facing short-term headwinds, with other healthcare REITs such as Omega Healthcare Investors (OHI) freezing their dividend. Overall, I think Ventas made the right decision and the conservative approach will pay off in the long run. This raise led to an increase in my annual forward dividends of $0.04 across my 4 shares.

Increase #4: AT&T (T)

AT&T announced a 2% dividend increase from a quarterly dividend of $0.50/share to $0.51/share. This dividend increase was as expected as well. Much like Ventas, I don't expect AT&T to go gangbusters and raise its dividend by 10% or something like that. With a company that's yielding near 7%, I simply expect raises roughly in line with inflation, which is what AT&T has delivered for years now. I expect dividend growth to transition from the deceleration of penny increases to larger 3-4% increases in a few years once AT&T shifts its focus from paying down its debt. This dividend increase led to an increase in my annual forward dividends of $0.64 across my 16 shares.

Increase #5: Pfizer (PFE)

Pfizer announced a 5.9% dividend increase from a quarterly dividend of $0.34/share to $0.36/share. This dividend increase was also what I expected from Pfizer, continuing the trend of annual $0.02 quarterly raises. This raise led to an increase in my annual forward dividends of $0.64 across my 8 shares.

Increase #6: Amgen (AMGN)

Amgen announced a 9.8% dividend increase from a quarterly dividend of $1.32/share to $1.45/share. This dividend increase was actually what I expected when I made this projection a few months back in my notepad on my phone. However, I changed my projection upon actually writing my predictions a few weeks back, for apparently no reason aside from the fact I completely forgot about that note of projections. At any rate, this increase led to an increase in my annual forward dividends of $0.52 across my single share.

Increase #7: Dominion Energy (D)

This dividend increase took me and most of the community by complete surprise! Dominion has generally announced their dividend increase in January for the past few years. I expected this trend to continue, but Dominion announced a dividend increase on December 14th, about a month earlier than usual. The company announced a 9.9% dividend increase from $0.835/share to $0.9175/share. This increase was just as management indicated it would be many months ago. My annual forward dividends increased by $0.99 across my 3 shares. 

Expected Dividend Increases:

Increase #1: Realty Income (O)

Realty Income increased its dividend just a couple weeks ago, but its largest increase of the year will likely be coming in January. Historically, the company has raised its dividend in January by 3-4%. I expect that trend to continue and I am forecasting an increase in the monthly dividend from $0.2210/share to $0.2290/share. If this does in fact occur, my annual forward dividends will increase $0.384 across my 4 shares.

Increase #2: Enterprise Products Partners (EPD)

Enterprise Products Partners increased its dividend this past October, as it has done for every first month of the quarter for several years now. I expect this trend to continue with a raise in January. I am forecasting the typical raise of $0.0025 that Enterprise has done for 5 consecutive quarters now. This will increase the quarterly dividend by 0.6% from $0.4325/share to $0.435/share. If this prediction proves to be correct, the raise will increase my annual forward dividends by $0.09 across my 9 shares.

Increase #3: EQM Midstream Partners (EQM)

I believe that EQM will continue its streak of increasing dividends every quarter by announcing an  a 2.4% in the quarterly dividend from $1.115/share to $1.14/share. If this does happen, my annual      forward dividends will increase by $0.40 across my 4 shares.

Summary: 

Phew, this was quite a lengthy write-up. I wouldn't have it any other way! Overall, I received 7     raises for the month of December! One of which, I expected would increase dividend in January, but I'll take that Dominion raise any time of the year. 9.9%, thank you very much! These 7 raises increased my annual forward dividends by $2.914, which is undoubtedly my largest increase in annual forward dividends in a month stemming from solely dividend raises. It would take an investment of $72.85 at a yield of 4% to create the same impact as $2.914 in dividend              increases.

Although there will be an inevitable slowdown in January, it appears as though my annual forward dividends should increase by about $0.874 for the month of January from dividend increases alone. Along with my occasional fresh cash contributions and dividend reinvestment, the portfolio      continues to make strides.

Discussion:

Has your December been as full of raises as mine? Are you expecting any raises in the last few days of this year? As always, I welcome and appreciate your comments. Thanks for reading and keep on rolling that dividend snowball!