Tuesday, January 2, 2024

December 2023 Dividend Stock Purchases

As I'm writing this blog post, it's hard to believe that 2023 as we know it is just three days away from reaching its conclusion. Still, the temperatures here in Central Wisconsin remain warm for the season. It is expected to reach a high of 40 degrees Fahrenheit later today.

With that aside, now would be a good time to discuss the transactions that I completed in December. Let's dig in.

First, I closed out my seven share position in Medifast (MED) for an average price of $67.04 each. Earlier in the month, the company announced that it would be discontinuing its quarterly dividend per share of $1.65. MED intends to invest this cash to enhance the customer experience and acquire customers to revive its growth story. Overall, I think this was a necessary move on the part of the company to reinvent itself amid the anticipated surge in the popularity of the GLP-1 drug class. But since the vast majority of dividend cutters and suspenders underperform the market as a whole, I simply don't have the patience to ride this one out any longer. The dividend suspension and my sale of shares reduced my net annual forward dividends by $46.20.

My first move to redeploy these proceeds came with my addition of 12 shares of Ares Capital (ARCC) at an average price per share of $20.09. Readers curious on my buying rationale for ARCC can check out my Seeking Alpha article from two months ago. This boosted my net annual forward dividends by $23.04, which equates to a 9.56% dividend yield.

The other transaction I executed to redeploy capital proceeds was seven units of MPLX LP (MPLX) at an average cost of $35.67 a unit. This lifted my net annual forward distributions by $23.80, which equates to a 9.53% distribution yield. For my investment thesis, interested readers can peruse my recent Seeking Alpha article on MPLX.

Finally, I reinvested $176.88 into my Capital Income Builder (CAIBX) mutual fund holding (net the $10 annual fee) within my retirement account from a previous employer. These dividends, special dividends, and capital gains payments added 2.706 shares to my share count. That upped my net annual forward dividends by $5.764, which equates to a 3.26% net dividend yield.

Concluding Thoughts:

December 2023 marked the fourth consecutive month that I worked on building my emergency fund to a more robust level. At the rate that I am going, I anticipate that my emergency fund will be up to my target by the end of January. Thus, I hope to begin investing between $1,500 and $2,000 in capital each month starting in February.


How was your month for capital deployment?

Did you open any new positions or close any positions in December 2023?

As always, thanks for reading and please feel free to comment below!

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