New Buys FAST and NWL

18 Oct 2018 19:48

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Replaced my Thor Industries (THO) sell from last week by grabbing a new position in Fastenal (FAST) at 52.32/share & 3.09% dividend yield as well as increased my position in Newell Brands (NWL) with shares at $16.97/share & a 5.42% dividend yield. The two purchases together will add $85 annually to my forward dividend.

The FAST decision was actually a tough one as I was also considering Illinois Tool Works (ITW). The two had similar financial ratios and dividend yields. I ended up going with FAST as they had a better book value per share (8.07 vs. 11.29) and current ratio (5.39 vs. 2.16). Do not think I could have gone wrong with either so happy that I finally chose one.

My second purchase I was targeting Pepsico (PEP) and waiting for the price to drop below a $104/share. While waiting for PEP, NWL dropped to less than $17/share and knew I had to take advantage. Understand that NWL never has or ever will be a growth story but they are a value play and this is a company whose individual parts are worth more than the sum. If NWL gets the right manager this could be a great turnaround strategy but until that time comes I am more than willing to take a generous 5% dividend yield.

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