Tuesday, January 21, 2020

Expected Dividend Increases for February 2020

As I write this, the Green Bay Packers are a couple days removed from their 37-20 loss to the San Francisco 49ers in the NFC Championship Game. As I had indicated in my November 2019 Dividend Stock Purchases post last month and last year (it still feels a bit weird to think that 2019 was last year), I didn't believe the Packers would advance past the NFC Championship Game, and I was unfortunately proven correct.

On the upside, the Bucks are continuing to prove in my mind why they are the odds on favorite to win the NBA championship. The Bucks took care of business against the Chicago Bulls on MLK Day at Fiserv Forum just as everyone expected, winning 111-98. Milwaukee's net rating of 12.0 means the Bucks are on track to post the best net rating in history while also unsurprisingly being on pace for 71 wins this season (after an impressive 39-6 thus far), the latter of which would make them only the third team in NBA history to do so.

Aside from the typical sports talk, the intent of this blog post is to recap the dividend increases that I have received in January, and to also predict the dividend increases for next month.

Admittedly, I am writing this post on the very day that I plan to publish it because I made it a point to relax this weekend, and my OCD-like tendencies otherwise prohibit me from not publishing my 79th consecutive Tuesday blog post. A blog post on a Wednesday? No way!

Anyway, with that all out of the way, let's delve into the dividend increases that I have been fortunate enough to receive to date in the month of January and what I'm expecting for February!


Increase #1: Realty Income (O)

True to form, Realty Income (O) announced another predictable dividend increase during the month of January roughly in line with my prediction outlined in my previous post in the series. O increased its monthly dividend 2.2%, from $0.2275/share to $0.2325/share. With another 4 small raises likely to come this throughout the rest of this year, O offers dividend growth that exceeds inflation. It's both fortunate and unfortunate that the company is viewed as a safe haven by so many other individual and institutional investors because I'd love to buy more of this company, but the valuation has become too rich for my liking over the past number of months.

Across my 4 shares, O's new dividend announcement boosted my annual forward dividends by $0.24.

Increase #2: Enterprise Products Partners (EPD)

As yet another steady dividend (or distribution rather) grower in my portfolio, Enterprise Products Partners (EPD) didn't disappoint. EPD raised its quarterly distribution for the 62nd time, with its quarterly distribution increasing 0.6%, from $0.4425/unit to $0.4450/unit.

Given my 27 units of EPD at the time of the new distribution announcement, my annual forward distributions increased $0.27.

Increase #3: Magellan Midstream Partners (MMP)

As Magellan Midstream Partners (MMP) has done for the past couple of distribution increases, it has completely eluded my radar. I was about to write that I hadn't yet received an increase from MMP, but in a surprising twist, I just learned that the company increased its distribution today rather than the announcement later this week that I was expecting based upon previous distribution history.

Just as expected, MMP announced a 0.7% increase in its quarterly distribution, up from $1.0200/unit to $1.0275/unit.

Across the 7 units of MMP that I own, this distribution announcement padded my annual forward distributions by $0.21.

Expected Dividend Increases for February 2020

Expected Increase #1: Digital Realty Trust (DLR)

Given Digital Realty Trust's (DLR) past dividend increases, I am predicting that the company will announce a status-quoesque 6.5% increase in its quarterly dividend from $1.08/share to $1.15/share.

With my 3 shares, this would boost my annual forward dividend income by $0.84.

Expected Increase #2: PPL Corp (PPL)

Given the uncertain nature of what the outcome will be with Brexit and PPL Corp's (PPL) exposure to that market, I wouldn't be surprised if we see another dividend increase that is fairly similar to the one last year.
It's for that reason, I am predicting that PPL will announce a 1.2% increase in its dividend, taking the quarterly dividend from $0.4125/share to $0.4175/share.

Across my 8 shares of PPL, this would increase my annual forward dividends by $0.16.

Expected Increase #3: The Home Depot (HD)

While I don't expect The Home Depot (HD) to repeat its absolutely monstrous 32% increase in its quarterly dividend from last year, I am expecting the company to increase its quarterly dividend from $1.36/share to $1.56/share.

This would add $0.20 to my annual forward dividend income as a result of the single share that I own.

Expected Increase #4: Genuine Parts Company (GPC)

As a relatively predictable dividend growth company, I am expecting Genuine Parts Company (GPC) to continue its trend of increasing its quarterly dividend in the 5-7% range.
I believe GPC will increase its quarterly dividend 6.2% from $0.7625/share to $0.8100/share.

Assuming this occurs, my annual forward dividend income would increase by $0.57 across my 3 shares.

Expected Increase #5: Prudential Financial (PRU)

Even though Prudential Financial (PRU) could afford to increase its dividend a good bit more than its earnings growth, I'm expecting PRU's dividend growth to decelerate a slight bit compared to the 11.1% last year.

I'm predicting that PRU's quarterly dividend will be increased from $1.00/share to $1.09/share.

Given that I own 3 shares of PRU, this would boost my annual forward dividends by $1.08.

Expected Increase #6: Albemarle (ALB)

Albemarle (ALB) is another dividend growth company in my portfolio that I predict will deliver high-single digit to low-double digit dividend growth this year.

I'm expecting an 8.2% increase in its quarterly dividend from $0.3675/share to $0.3975/share, which would result in an additional $0.60 in annual forward dividends for my portfolio given my 5 shares of ALB.

Expected Increase #7: Simon Property Group (SPG)

Given that Simon Property Group (SPG) has a recent history of increasing its quarterly dividend twice per year by $0.05 (late January to early February and late July to early August), I believe SPG will continue that trend in February.

A 2.4% increase in SPG's quarterly dividend from $2.10/share to $2.15/share would boost my annual forward dividends by $0.60.

Concluding Thoughts:

January may not have brought the most dividend/distribution increases in terms of volume or percentages, but it seems like the beginning month of every quarter brings with it a nice level of consistency pertaining to dividend and distribution increases.

All 3 companies that announced increases during January are among the most consistent in my portfolio, with quarterly dividend/distribution increases coming in at or near my estimates every time.

The $0.72 in annual forward dividend/distribution increases that I received during the month of January would require an investment of $18.00 at a 4% yield to replicate.

I expect to benefit from 7 dividend increases during the month of February, with 4 holdings expected to increase their dividends for the first time since I have initiated positions in them (DLR, PRU, ALB, and SPG).

Depending on the outcome of the dividend increases that I expect next month, February 2020 could go down as my new record in terms of the dollar amount of dividend increases in a single month!

Discussion:

How many dividend increases are you expecting for the month of February? Are you expecting any dividend increases for the first time since you initiated your new positions?


As always, thank you for taking the time to read the dividend increases that I received during the month of January and what dividend increases I am expecting to receive in February.

I look forward to any comments that you may leave in the comment section below.

Tuesday, January 14, 2020

December 2019 Dividend Income

As I write this post, we're just a couple days away from entering into 2020! It really is unbelievable to think back on how fast this year passed us by. With that in mind, now is a great time for me to go into further details about the dividend income that my investments generated for me in the very last month of 2019.






Analysis:

During the month of December, I collected $91.63 in dividends (although I also received $50.24 in long-term capital gains from my mutual fund holding, which purchased almost an entire share of CAIBX by itself).

This represents a 30.9% quarterly growth rate compared to the $70.00 collected in September 2019, and an even more impressive 70.2% YOY growth rate compared to the $53.84 in dividends produced in December 2018.

Breaking it down further, I collected $32.37 in dividends for my Robinhood account during the month, $9.63 in dividends in my Webull account, $49.15 in dividends in my retirement account, and the remaining $0.48 came from 24 companies of the 49 companies held in my M1 Finance account.

The $21.63 in additional dividends collected in December compared to September were as a result of the following developments by account:

Robinhood: 

Adjusting for Pepsi's dividend that was paid in September and the next that will be paid in January, there was no dividend growth in any of the companies that paid dividends in my Robinhood account during the month of December. Because Pepsi doesn't pay a dividend in December, this was responsible for the $1.91 decrease in dividend income originating from the Robinhood account that will be made up for in January.

Webull:

The entirety of the $9.63 collected in my Webull account during December came as a result of the dividend stock purchases that I made in October, when I added a share of UnitedHealth Group (UNH), Prudential (PRU), Visa (V), Wells Fargo (WFC), and Lockheed Martin (LMT).

Retirement:

The $42.01 in regular dividends that I received from my retirement account mutual fund holding, CAIBX, represented a $6.77 increase compared to September. The other component that led to higher dividend income in December compared to September was the $7.14 in special dividends that I collected from CAIBX as a result of the end of year dividend being larger than all the preceding dividends.

All told, I received an additional $13.91 from the retirement account compared to September.

Concluding Thoughts:

I'm relatively pleased with the month of December and it was a great way to close out the year, although I came up a bit short of the $100+ in dividend income that I was expecting for the month.

This was as a result of CAIBX's special dividend being a bit less than I thought it would be and less than it was last year. Had the special dividend been maintained compared to last year at $0.14/share rather than the $0.085 this year, my dividend income would have came much closer to the $100 mark.

Fortunately, I am confident that I will be able to finally break the $100 mark in March due to continued contributions to my retirement account, anticipated investment in my taxable accounts, and dividend increases to help boost my dividend income over that milestone.

Discussion:

How was your December in terms of dividend income? Did you have any new dividend payers in your portfolio during the month as I did?

Thank you for reading and I look forward to replying to any comments that you may leave below in the comments section.

Tuesday, January 7, 2020

December 2019 Dividend Stock Purchases

We've officially ushered in the New Year and the Milwaukee Bucks had quite a nail biter against a shorthanded (without Karl-Anthony Towns and Andrew Wiggins), but scrappy Timberwolves team last Wednesday!

Fortunately, they sent the fans at Fiserv Forum home with a 104-102 win to ring in the New Year with style. You won't catch me complaining about blowout wins for the Bucks, but it's the close wins like this one that prepare a team for success in the postseason.

Aside from the Bucks' win on Wednesday, a new month and a new year mean that it's time for us to examine the dividend stock purchases that I made to close out 2019!



Similar to last month's dividend stock purchases, the month kicked off with a purchase of another unit of Energy Transfer (ET) in my Robinhood account. I would add another unit to my ET holdings on two more occasions in my Robinhood account, and once in my Webull account.

The 4 units of ET that I ended up adding in December came at an average cost of $12.47/unit. Factoring in the current distribution of $1.22/unit, this equates to a 9.78% yield on this block of units. These purchases boosted my annual forward distributions by $4.88.

The next purchase that I made was Digital Realty Trust (DLR) in my Robinhood account, which I purchased 3 shares of at an average cost of $114.00 a share.

Given the annualized dividend of $4.32/share, my entry yield is 3.79% on this purchase. The great news is that DLR's dividend is also likely to be increased 6-7% next month, which will provide a nice boost in my annual forward dividends without having to wait too long after my purchase.

For those that are interested in a further explanation for my decision to initiate a position in DLR, I recently wrote an SA article on the company. This purchase added $12.96 to my annual forward dividends.

My final purchase in my taxable accounts came in my Webull account, when I purchased 1 share of Broadcom (AVGO) at a cost of $321.20.

AVGO's past few dividend increases really caught my attention and put the company on my radar. When I coupled the 4.05% starting yield on my purchase with the 13.3% annual earnings growth that Yahoo Finance expects over the next 5 years, it became clear that for those willing to stomach the volatility of AVGO's shares, this company is likely to continue delivering impressive dividend increases in the years ahead to really ramp up my yield on cost.

The purchase of AVGO boosted my annual forward dividends by $13.00, having purchased my share shortly after the news of the 22.6% dividend increase.

The final bit of activity came within my retirement account, where I invested $345.10 (including my employer's 3% match and the dividends/capital gains received during the month).

Accounting for the 4.5% sales charge, these contributions and the $49.15 in dividends/$50.24 in long-term capital gains collected from the CAIBX position, increased my holdings of CAIBX from 82.332 shares at the beginning of the month to 87.442 shares at the end of the month.

The 3.694 shares of CAIBX that were added as a result of capital contributions boosted my annual forward dividends by $7.91 while the 1.416 shares of CAIBX that were added as a result of dividends/long-term capital gains added the remaining $3.03 in annual forward dividends, for a total of $10.94 of additional annual forward dividends. This equates to an average yield of 3.17%.

Concluding Thoughts:

December was a somewhat light month compared to the past few months of capital deployment in the taxable accounts. I deployed $713.07 in capital within my taxable accounts during the month of December, while I also deployed $345.10 in capital within my retirement account, for total capital deployment of $1,058.17 during December.

The $41.78 in annual forward dividends/distributions added during the month equates to a 3.95% yield on the capital that I invested, which is right around my target of 4-4.5%.

Entering the month of December, my annual forward dividends/distributions were at $828.92 and ended the month at $873.51.

The $2.808 of dividend increases in terms of annual forward dividends/distributions accounted for the remainder of the income that was added during the month.

I ended 2019 with 45 whole share stock holdings, 23 unique fractional share holdings in my M1 Finance portfolio, and a mutual fund holding. Given that my only monthly dividend payer is Realty Income (O) and all my other holdings pay quarterly dividends, that equates to 284 payments throughout the course of the year heading into 2020 alone!

Discussion:

What are your annual forward dividends/distributions heading into 2020? Were you able to add any new positions to your portfolio as I was able to with the purchases of DLR and AVGO?

As always, thanks for reading my summary of dividend purchases during the month of December 2019. I look forward to reading and replying to any comments that you are welcome to leave in the comment section below!






Tuesday, December 31, 2019

Review of 2019 Goals

Now that I have provided my goals for 2020 and that the year is coming to a close in just a few days at the time of writing this post, I'll be examining the goals that I had for 2019 and whether I was able to accomplish each of them.

My financial goals for 2019 were as follows:

1. Collecting $550+ in dividends
2. Ending with $600+ in forward annual dividends
3. Amassing $15,000 in investments
4. Buying a used compact car in cash (i.e. Chevrolet Cruze)

Starting with the first goal of collecting $550+ in dividends for the year, I managed to collect $615.29 in dividends during 2019. This will be reflected on the dividend income page once I post my dividend income for December 2019 next week.

I was easily able to achieve this goal as a result of the $5,976.95 in capital invested in my taxable accounts and the $2,914.07 invested in my retirement account all the while paying tuition for the first 7 months of the year.

Although I invested like there was no tomorrow, this did come at the cost of one financial goal as we'll get into a bit later.


I am also poised to end 2019 with forward annual dividends of $873.51 as a result of the significant investments made in 2019 and the dividend increases announced during the year, which was something I couldn't imagine in even my wildest dreams.

On the investment goal front, I was able to amass $20,700 in investments as of December 30th. This represents a doubling of the $10,000 that I entered the year with, which is well beyond what I was expecting.

Unsurprisingly, it comes as a result of both a great year in the stock market and my capital deployment during the year.

Rounding out my financial goals for the year, I intended to purchase a used compact car to fix up in 2020.

While my father and I haven't been able to find a car for purchase yet, I am pleased to share that I have the capital necessary to make such a purchase.

This was the only financial goal that it could be argued I didn't technically achieve, but that could change at any point in the next few weeks now that I have the capital for us to start seriously browsing for cars.

Moving to my personal development goals for 2019, they were as follows:

1. Continue to publish at least one blog post each week
2. Publish at least 50 articles on Seeking Alpha
3. Secure an entry level accounting/finance position

Starting with the goal of publishing at least one blog post each week, I did the absolute minimum on this front to achieve the goal as this post is the 52nd of the year.

Overall, I feel that publishing once a week on my personal blog is adequate for me to document my journey to financial independence for myself and others. I could write more frequently, but I suspect that this would lead to burnout and cause me to despise the blog.

As far as writing for Seeking Alpha is concerned, I managed to publish 83 articles this year (possibly 84 or 85 if the ones that I am currently working on and will have finished by December 29th are published on New Years Eve).

Starting in May, I began to regularly write 2 articles each week, which really helped up the article count in a hurry.

I also believe that 2 articles a week on a fairly regular basis represents an optimal workload for me going forward. Any more than 2 a week would be too overwhelming given that I write for this blog, work 40+ hours a week at my day job/commute 2 hours a week, exercise regularly, and have a couple other side hustles going on.

Rounding out my personal development goals for the year was my goal to secure an entry level accounting and finance position.

Fortunately, I was able to do so and I have split my job responsibilities between accounting responsibilities and my responsibilities as a medical summarist at the Social Security Disability and Work Comp law firm that I work at.

Just as I had predicted, my day job pay increased significantly from around $28k annually with benefits included to $35k once I assumed my new responsibilities with the company this past June.

Given that I live in a relatively small and stagnant town in the Midwest, I believe this is a pretty decent starting wage for the first job relating to my major out of college. It was exactly what I expected and slightly below the $38k that I invested to receive my 4 year accounting degree.

Concluding Thoughts:

In retrospect, maybe I set a few of my goals too low given that I actually accomplished the majority of them several months ago. Going forward, I am going to set my goals much higher and account for the fact that I sometimes tend to be too conservative in setting goals. If I need to readjust the goals that I set for 2020 lower at some point during this year as they do seem a bit lofty, I will post an update with my updated goals.

Overall, 2019 was a year filled with accomplishments that I able to hang my hat on as I really begin to embark on my journey in life.

I'm especially looking forward to enjoying the grind of next year and trying to accomplish my lofty goals while I also look to maintain a healthy work life balance.

Discussion:

Although most of us still have a few more hours to go before the year is over in our respective time zones as this is published, how was your 2019? Were you able to accomplish all of your goals for the year?

Thanks for reading and I look forward to replying to any comments that you are welcome to leave in the comment section below. Let's all keep hustling and have a great 2020!