New Buys - HCP, AEO, F, OHI

10 Feb 2016 23:20

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Continuing with my 401K to IRA transition I had a few buys this week.

On Monday I had a limit order for 200 shares of HCP filled at $34/share with a yield of 6.7%. Unfortunately, the price came crashing down the following day and is currently trading at $27.21. Happy with the yield I got but an 8% yield sure would have been nicer. Other than HCP I had no other limit orders filled but since I decided not to chase Cummins (CMI) it did leave me with a little extra cash to spread around for some other buys I had my eye on.

With the all healthcare REITS crashing on Tuesday I took advantage of the opportunity and picked up another 50 shares of Omega Healthcare (OHI) at $27.45 and a yield of 8.31%.

My second pick-up of the day was 100 shares of Ford Motor (F) and $11.36 and a dividend yield of 5.28%. American auto manufacturers are so unloved and Ford’s share prices are the same as they were in 2012. Sorry but this is not the same company it was back then. They have better cost structures and Union agreements better positioning the company to weather down cyclical years. Lots of investors are staying way but I’m embracing GM & F while prices are low.

My third and final pick was 100 shares of American Eagle Outfitters (AEO) at $13.20 and a dividend yield of 3.79%. With disappointing growth numbers coming out of Christmas the whole sector has been beaten down and AEO is well positioned if consumer spending picks up. While not a traditional dividend grower there is potential, they have a significant amount of cash on the books and no long term debt. Their main product line is still popular and their new Aerie lingerie brand has been exploding and is actually starting to challenge Victoria’s Secret. I could have picked up Kohls (KSS), Wal-Mart (WMT), or Target (TGT) but the problem I have with many of the big names is that they have already expanded into every state so growth is extremely limited unlike AEO who has expanding and popular product offerings.

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