Kody's Dividends

Tuesday, January 21, 2025

February 2025 Stock Watch List

As I'm writing this blog post on Friday, January 17th, it's going to reach a high of 40 degrees Fahrenheit here in Central Wisconsin later today. For this time of year, that's a definite heat wave. I'll gladly take it, too!

Now that there are just two weeks left in January, I'm going to take a moment to look ahead to the stocks on my watch list for February 2025.

Stock #1: Amazon (AMZN)

The first stock on my watch list for next month is once again Amazon. This has been a pick that I've been adding to just about every month lately. Interested readers can find my buying rationale in my December 2024 Stock Watch List blog post and my Seeking Alpha article from last November.

AMZN continues to have undeniable catalysts in e-commerce, cloud computing, and digital advertising. The net cash and marketable securities position continues to grow. Best of all, shares look to be substantially discounted from the current $226 share price (as of January 17th, 2025).

Stock #2: British American Tobacco (BTI)

Next up on my watch list for February is British American Tobacco. My investment thesis is essentially unchanged from my December 2024 Stock Purchases blog post.

BTI's 8.1% yield is effortlessly covered by profits and free cash flow. The company looks poised to generate mid- single-digit annual EPS growth in the years ahead. Finally, the forward P/E remains below eight. Thus, why I'm interested in buying more BTI at the current $36 share price (as of January 17th, 2025).

Stock #3: PepsiCo (PEP)

The third stock on my watch list for next month is PepsiCo. Curious readers can check out my investment thesis in my November 2024 Dividend Stock Watch List blog post and December Seeking Alpha article.

The higher for longer rate environment and concerns about GLP-1 weight loss drugs have pressured PEP's stock in recent months. Yet, the company's annual core EPS growth looks to be holding around 6% or 7% for now. PEP also boasts an A-rated balance sheet. Along with a well-covered 3.7% dividend yield, I believe the stock should deliver double-digit annual total returns from the current $148 share price (as of January 17th, 2025).

Concluding Thoughts:

That's it for now. My plan is to allocate about 45% of my capital to AMZN and split the remaining 55% between BTI and PEP. In my view, this is an excellent mix of growth at a cheap valuation in AMZN and sustainable and growing income on sale in BTI and PEP.

Discussion:

Are any of AMZN, BTI, or PEP on your watch list for February 2025?

If not, what are you keeping on your radar for next month?

I appreciate your readership and look forward to your comments below!

Tuesday, January 14, 2025

My Financial And Personal Goals For 2025

As I'm writing this blog post, it's currently Friday, January 10th, 2025. The temperature here in Central Wisconsin is going to reach a high of 24 degrees Fahrenheit later today. For this time of year, I'll take it!

Now that we're into the new year, it would be a good time to briefly highlight my financial and personal goals for 2025.

My Financial Goals For 2025

1. Generate At Least 25% Growth In Net Dividends Collected

I believe that a realistic goal for 2025 is for 25% growth in net dividends collected. This is because for the last few months of 2023 and the first few months of 2024, I didn't invest any capital. I made up for it in later months, but that cost me some dividends. As I outlined in last week's blog post, this helped my net dividends received in 2024 rise by 22% to a new all-time high.

2. Grow Net Annual Forward Dividends By 25%

My second goal is similar to my first goal. I'm aiming for 25% growth in my net annual forward dividends from the start of 2025 to the end of it. If I can continue to compound my net annual forward dividends by around this rate, I could reach financial independence at around age 35 or 36 (adjusting for a 3.5% annual inflation rate).

Personal Goals For 2025

1. Bike 40 Miles A Week

As I indicated in my prior blog post, I have shifted my focus to the stationary bike. Overall, I find it more enjoyable than a treadmill. Thus, I'm going to stick with it. That's why my goal is to bike right around 40 miles a week (10 miles a day, four days a week).

2. Lift Weights Four Times A Week

As far as strength training is concerned, my goal is to stick with doing it four times a week. I'll gradually move up and would like to end the year doing three sets of 12 reps of various motions with 20 lb dumb bells.

3. Publish A Blog Post Each Week

As there were 53 Tuesdays in 2024, I published a blog each week. For 2025, I plan on keeping this same pace. It's a nice balance for me to document my journey for myself and for any interested readers.

Concluding Thoughts:

That's all for now. I have my goals set for the year. Now, it's time to work on achieving them and enjoying the journey along the way!

Discussion:

What are your goals for 2025?

Do you anticipate that any of your goals will be more difficult to achieve versus others?

Thanks for reading and please feel free to comment below!

Tuesday, January 7, 2025

Review of 2024 Goals

As I'm writing this blog post, 2024 has recently concluded. The weather here in Central Wisconsin isn't bad for this time of the year, either. The high is expected to reach a balmy 26 degrees Fahrenheit today, January 1st.

Now that we have entered a new calendar year, it would be a good time to look at how I fared in achieving my goals in 2024. Without further ado, let's dig into it!

Financial Goals for 2024

1. Generate at least 20% growth in net dividends collected - Pass

In 2024, I received $4,781.80 in net dividends across my accounts. That equates to a 22% growth rate versus the amount collected in 2023. Thus, I narrowly surpassed this goal. Dividend raises and my allocation of nearly $24,000 in fresh capital contributed to this uptick in my net dividend income.

2. Grow net annual forward dividends by 20% by the end of the year - Pass

Heading into 2025, my net annual forward dividends are right around $5,455. That's good enough for a 26.5% growth rate versus the $4,315 in net annual forward dividends heading into 2024. As a result, I exceeded this goal.

Why the disconnect between net dividends collected and net annual forward dividends? I didn't put capital to work in the last few months of 2023 and the first few months of 2024. This limited the growth in my net dividends received to start 2024.

Personal Goals for 2024

1. Jog at Least 10 Miles a Week - Mostly Pass

Throughout 2024, I met my goal of jogging 10 miles a week all but a handful of weeks. For the most part, my failure to fully meet this goal was because my family recently purchased a stationary bike. I've been getting more into that lately, so I haven't been using the treadmill quite as much. That's why I would say I mostly met this goal.

2. Lift Weights at Least Four Times a Week - Mostly Pass

Minus a couple of occasions in 2024, I lifted weights four times each week. I finished the year doing three sets of 12 reps of various movements with 10 lb dumb bells. That was less than my initial goal of 15 lb dumb bells. However, the route that I have been taking is paying off. I've been happy with my incremental gains in muscle and want to continue that in a sustainable way (e.g., avoiding injury and a setback). That's why I give myself a mostly pass on this goal.

3. Publish a Blog Post Each Week - Pass

I published 52 blog posts in 2024, so I managed to post one blog each week. That has been the case since the start of this blog and I hope to continue this tradition into 2025 and beyond.

Concluding Thoughts

Overall, 2024 was a solid year for me. I met or exceeded three out of my five goals for the year. The other two that I didn't technically meet still represented solid progress for me. This blog post won't be published until January 7th, but I wanted to close by wishing everyone a great start to the New Year!

Discussion:

How was your 2024?

Did you achieve your goals?

I appreciate your readership and look forward to your comments below!

Tuesday, December 31, 2024

December 2024 Stock Purchases

As I'm writing this blog post on Friday, December 27th, the temperature here in Central Wisconsin is going to reach a high of 41 degrees Fahrenheit. For this time of year, I'll take it.

Now that the month (and year) is just about complete, I'll take a look at my stock purchases for December 2024. Without further ado, let's dig into it!

Stock Purchase #1: Amazon (AMZN)

The first stock that I purchased for the month was an additional five shares of Amazon at an average price of $210.82 a share. Curious readers can check out my November Seeking Alpha article or December 2024 Stock Watch List blog post for my investment thesis.

Stock Purchase #2: Ares Capital (ARCC)

The next stock that I added in December 2024 was another 40 shares of Ares Capital at a cost per share of $22.15. I intended to buy units of MPLX LP. However, the partnership surged about 10% between when I highlighted it last month and when I deployed capital for this month. In my view, ARCC was a suitable substitute. That boosted my net annual forward dividends by $76.80, which works out to an 8.67% net dividend yield.

Stock Purchase #3: Meta Platforms (META)

The third stock that I purchased was another share of Meta Platforms at $591.96. Readers can find my investment thesis in my December 2024 Stock Watch List blog post linked above. This transaction lifted my net annual forward dividends by $2, which equates to a 0.34% dividend yield.

Dividend Stock Sale: Broadcom (AVGO) and Crown Castle (CCI) and Innovative Industrial Properties (IIPR) and Brookfield Asset Management (BAM)

I sold 10 shares of Broadcom for a total of $236.76 each. This had nothing to do with the overall fundamentals and more to do with the valuation. AVGO is priced at a forward 12-month P/E ratio of nearly 37, which is getting a bit rich in my opinion. Thus, I decided to sell 25% of my position and recover 170% of my overall cost basis. That took my weighting in AVGO from a somewhat lofty 6%+ back down to about 5%. So, I'll now be holding from here for the time being. This move reduced my net annual forward dividends by $23.60.

I also sold out of my eight share position in Crown Castle (CCI) at $90.26 each and my six share position in Innovative Industrial Properties (IIPR) at $76.54 each. The driving factor in both of these sales was the lack of future growth potential. These moves reduced my net annual forward dividends by $50.08 and $45.60, respectively.

I also sold off about 40% or 21 shares of my Brookfield Asset Management (BAM), with the closing of the position in my IRA at $54.51 apiece. This wasn't done because of poor fundamentals, but the big runup in the share price in recent months. Long term, I'm still a believer in the company. However, I wanted to take money off the table and redeploy proceeds into more of a value pick. This reduced my net annual forward dividends by $31.92.

Stock Purchases: Nvidia (NVDA) and Rexford Industrial Realty (REXR) and British American Tobacco (BTI) and Enterprise Products Partners (EPD) and Enbridge (ENB)

I added another nine shares of Nvidia at a cost of $127.82 a share. Curious readers can check out my January 2025 Stock Watch List blog post for the gist of my investment thesis. This transaction added $0.36 to my net annual forward dividends.

I also opened a 30 share starter position in Rexford Industrial Realty at an average price per share of $40.56. This lifted my net annual forward dividends by $50.10. My rationale is largely unchanged from my October Seeking Alpha article.

I added another 13 shares of British American Tobacco at a cost of $36.26 apiece. This is because the stock's 8.1% yield appears to be reasonably safe. The company's plans to transition to a smoke-free sales mix remain on track. Shares also look to be undervalued, with the forward P/E ratio coming in below eight. This transaction boosted my net annual forward dividends by $38.35.

I also purchased an additional 24 units of Enterprise Products Partners at a price per unit of $30.78. Interested readers can check out my November Seeking Alpha article or my October 2024 Stock Watch List for my investment rationale. This decision lifted my net annual forward distributions by $50.40.

Lastly, I added 29 shares of Enbridge (ENB) at a cost of $41.50 a share. For curious readers, my buying rationale is the same as it was in my September 2024 Dividend Stock Watch List. This decision added $77.72 to my net annual forward dividends.

Retirement Account Reinvestment: Capital Income Builder (CAIBX)

I reinvested the $499.76 in net dividends and capital gains distributions that I received from Capital Income Builder in my retirement account from my former employer. That upped my share count by 7.335 to 202.235. This lifted my net annual forward dividends by $16.94, which equates to a 3.39% net dividend yield.

Concluding Thoughts:

In December, I allocated $3,031.81 in fresh capital. Given the $95.74 in net annual forward dividends that these purchases added to my portfolio, that is equivalent to a 3.16% weighted average dividend yield. Capital redeployment added $65.73 to my net annual forward dividends.

My net annual forward dividends were also boosted by $19.978 from December 2024 Dividend Increases. A $16.55 upward adjustment in my CAIBX net annual forward dividends also factored into my net annual forward dividends rising from approximately $5,255 heading into the month to roughly $5,455 heading into January 2025.