Follow the dividend investment decisions of a person who has no background in financial investment and wishes to take control of their financial future to retire from their full-time job at 60.

Weekly Portfolio Summary - 29 Mar 2020 12:22

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Received a dividend cut from SABRA Healthcare (SBRA) this week. Not unexpected but always tough to watch progress go backwards.

Portfolio Activity

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Portfolio News - (In Case You Missed These Headlines)

AbbVie (ABBV)

Ares Capital Corporation (ARCC)

Chatham Lodging Trust (CLDT)

Chevron (CVX)

EPR Properties (EPR)

Microsoft Corp (MSFT)

Newtek Business Services (NEWT)

Omega Healthcare (OHI)

Pfizer (PFE)

Prospect Capital (PSEC)

Phillips 66 (PSX)

Sabra Health Care REIT (SABRA)

Weyerhaeuser (WY)

Interesting Blog Posts or Articles

Blog Posts

Articles

New Buys for the Week - 28 Mar 2020 10:40

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Buying was fairly light not because of lack of cash but because I transferred money to my brokerage that did not clear until Thursday. Of course the markets by then had a stellar two day rally and that Thursday made it a three day rally so a lot of the stocks I have been watching shot up with the market.

Friday the markets came down and I grabbed 3 companies to add $9 to my annual income, I could have bought quite a bit more in shares but patience and control is the name of the game here. If I had invested all my cash and then see a bargain like PEP or JNJ go down to $100/share I'd be kicking myself for not having any cash to buy.

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Weekly Portfolio Summary - 22 Mar 2020 12:03

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Received my first two dividend cuts from Apple Hospitality (APLE) and Chatham Lodging (CLDT) as they have suspended their dividends during the COVID-19 crisis. I think this is the right move to retain shareholder value and to ensure the brands can come out the other side without declaring bankruptcy.

I only have one other hotel REIT (SVT) that contributes $586 annually that I am expecting a dividend suspension from but as of yet they have not announced it. Hopefully they will announce one in the short term as I would view it as a positive step. Seems weird cheering for a dividend cut but these are not normal times.

Portfolio Activity

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Portfolio News - (In Case You Missed These Headlines)

AbbVie (ABBV)

Apple Hospitality (APLE)

Preferred Apartment Communities (APTS)

Artesian Resources (ARTNA)

Brookfield Renewable Partners (BEP)

Chatham Lodging Trust (CLDT)

Cummins (CMI)

General Mills (GIS)

Johnson & Johnson (JNJ)

Newtek Business Services (NEWT)

Pfizer (PFE)

Prospect Capital (PSEC)

Sabra Healthcare REIT (SABRA)

Walmart (WMT)

Williams-Sonoma (WSM)

Interesting Blog Posts or Articles

Blog Posts

Weekly Buys - 21 Mar 2020 17:00

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I am finally getting comfortable with free trading in my Fidelity accounts and no longer waiting to build up cash to buy one or two companies at a time.

Best part is I a am finding it more fun to buy companies in small quantities. That said, I bought a total of 8 different companies that add $34 to my annual income.

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Pandemic Effects in My Corner of the World - 15 Mar 2020 16:06

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Effects at Home

On the home front, my wife was notified her job is on indefinite hold. She is an hourly worker so we are facing the potential loss of a paycheck. Her employer has provided 2 weeks of additional pay but after that any lost time is lost income.

My worst financial moment in life was from 2010 to 2015 which has helped better prepare us for this moment. During that time period we cut expenses to the bone and since have only grown our expenses marginally. Additionally, we have used the last 5 years to eliminate debt which further reduces this impact. In preparation for the possibility of income loss we already cut back on spending $250 a month. Outside of my 401K savings, we save an additional $1200 month so there is another knob we could turn by reducing our savings if necessary.

On my Friday ride home during rush hour from work I normally see 40-50% of traffic as out of state plates with the bulk being Massachusetts plates heading north to go home. But this week most of the plates were from New York and New Jersey. Not sure if this is a Corona panic thing or if parents were picking up their college kids as most colleges in the area have closed campuses.

My wife and I did our weekly shopping this week at our local warehouse club (BJs) and you would have thought the apocalypse is upon us. More than half the cars in the lot had dealership tags from other ends of the state and quite a few out of state plates. Inside the store was worse, people on average were buying 3 bulk size packages of paper towels as that was the only disposable paper products left. Canned and prepared food shelves were nearly empty as was dairy, frozen goods, and most bottled drinks. Living in New England I see a lot of grocery runs in preparation of snow storms but I’ve never this many shelves empty in a warehouse club. Here is a pic of folks lining up to get into the store, this was worse than a Black Friday sale!

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Effects on Investing

I keep 20% of my investment portfolio in cash & bonds for moments like this so the market drop has been less dramatic but it still stings none the less. As far as my investing approach, I will no longer be buying REITS in my ROTH account.

REITs are too much of a wild card as they are so cash flow dependent and we are seeing this evaporate quickly as people remain at home and reduce spending. There are a few exceptions like industrials and data center REITS but with so many dividend growth companies having their stock prices drop they now have dividend yields that are on par with REITS so I would rather pursue buying quality dividend growth companies.

In my regular M1 Finance brokerage account I am making no changes on that front and will continue to invest my $120 per week. My M1 pies consists of 55 dividend paying companies with minimal exposure to oil stocks. For me, the easiest way to manage my fear is not to look at the individual components but the overall portfolio which now yields 4.35% and just last January was yielding 3.36%. A 4.35% yield is a significant return but not large enough to set off alarms that the majority of my holdings are at risk.

In my IRA, I stopped making contributions in 2017 and whenever cash builds up from dividends I’ll buy targeted stocks. Currently I like the following:

AbbVie (ABBV), IBM (IBM), Johnson & Johnson (JNJ), 3M (MMM), PepsiCo (PEP), PPL Corp (PPL), Pfizer (PFE), Prudential (PRU) AT&T (T), United Parcel Service (UPS) and Verizon (VZ).

I’m also keeping an eye on Artesian Resources (ARTNA) as it has occasionally dipped low enough to pay a 3% dividend but it usually does not last long. Whenever I see a water utility paying 3% it grabs my attention as it is a rarity when this type of utility is paying a decent yield. Also, in my portfolio over the last 30 years water utility companies have been the safest stocks I have ever owned.

In my 401K I did make one minor change. I use my 401K as a wealth preservation tool and make 80% of my contributions in cash & bonds and 20% in stocks. With bonds at all-time highs I decided to flip my future contributions to 80% stocks and 20% bonds. Other than that I have not moved any money around but if the DOW drops below 20,000 I will move 10% from my cash position to an S&P 500 fund and if the DOW drops to 15,000 I’ll move another 40% from cash to stocks. - Comments: 0

Weekly Portfolio Summary - 14 Mar 2020 12:22

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Portfolio Activity

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Portfolio News - (In Case You Missed These Headlines)

AbbVie (ABBV)

Air Products (APD)

Apple Hospitality (APLE)

Artesian Resources (ARTNA)

Bar Harbor Bankshares (BHB)

Chatham Lodging Trust (CLDT)

EPR Properties (EPR)

Johnson & Johnson (JNJ)

PepsiCo (PEP)

Pfizer (PFE)

Qualcomm (QCOM)

AT&T (T)

T. Rowe Price (TROW)

Walgreens Boots Alliance (WBA)

Weyco (WEYS)

W.P. Carey (WPC)

Interesting Blog Posts or Articles

Blog Posts

Articles

Weekly Portfolio Summary - 07 Mar 2020 13:32

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Portfolio Activity

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Portfolio News - (In Case You Missed These Headlines)

AbbVie (ABBV)

Armanino Foods of Distinction (AMNF)

Preferred Apartment Communities (APTS)

Chevron (CVX)

First American Financial (FAF)

Johnson & Johnson (JNJ)

Merck (MRK)

Newtek Business Services (NEWT)

Newell Brands (NWL)

Pfizer (PFE)

Prudential Financial (PRU)

Microsoft (MSFT)

Newtek Business Services (NEWT)

Interesting Blog Posts or Articles

Blog Posts

Articles

2 Stocks I Am Watching - 01 Mar 2020 23:15

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With the recent market drop one would expect value stocks to be dropping from the sky and of course who wouldn’t want to snap up a deal? With a fairly high expectation of value, I decided to run a screen with more conservative criteria:

Market Cap: greater than $5B
Dividend Yield: greater than 2%
Payout Ratio: less than 50%
Consecutive Dividend Growth: minimum 9 years
Dividend Growth Rate: greater than 8% in 1, 3, & 5yrs
Discount to 5yr Average Book Value: less than -5%

The screen surprisingly returned only 2 results both of which I find attractive for different reasons.

Discover Financial Services (DFS) - I really like this stock and it has never been on my radar till today. DFS has been overlooked as it sits in the shadow of Visa (V), Mastercard (MA), and the big banks (JP Morgan, Bank of America & Citi). This has dividend growth & total return potential. Here is a link to a recent CNBC piece on DFS: How Discover Won Over the Middle Class

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Prudential Financial (PRU) – From a total return perspective PRU has been a total dud but if you value income this one suddenly becomes a stud! With a yield above 5% and a 10yr dividend CAGR of 19% and its most recent dividend increase announced in February came in at 10% keeping that awesome streak alive.

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February Dividend Income - 01 Mar 2020 13:55

Tags: monthly_income

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After 33 years of clocking in and out of work and religiously saving 10% annually every year, in good times and bad, I have decided to share my monthly dividend income to show what regular saving and investing can accomplish.

For the month of January I made $2,409; an increase of 9.94% versus this time last year. I target a growth rate of 12.5% but my tracking metrics show the bulk of my year over year growth occurs in the last month of a quarter so I am not too concerned being under my target.

In regards to buying, I increased my position in Prudential Financial (PRU) and Brookfield Property REIT.

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In my M1 Finance account, I continued with my weekly $120 contribution for a total of $480. The overall dividend yield of my M1 pie increased to 3.816%. While there have been a few dividend raises the bulk of the increase was attributable to the massive market sell-off in the last week of February.

Overall my M1 Finance accounts contributed $7.56 to this month’s dividend totals. Finally getting closer to double digit monthly income.

I also provided a link to my M1 Pie for those interested in seeing all of the individual holdings.
https://m1.finance/NCB--FZCZ

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My age 53 goal (I’m 51 for those not in the know) improved by 0.65%. This was a nice positive step forward.

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For those not familiar with my Age 53 goal, I plan in 7 year increments and targeted to have 57% of my expenses to be covered via dividend income and to be at 115% for my next 7 year target at age 60. Why 115%? This was based on a multiple bear market/crash analysis I performed back in 2018 that showed my optimal portfolio to withstand a long term bear market with high inflation would be to have dividend income of 115% of expenses and the equivalent of 9 months of expenses in cash. - Comments: 0

Weekly Portfolio Summary - 29 Feb 2020 13:50

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Wild week but the weekend is here and time for investors to take a breather. The market drop created some interesting opportunities and I'll publish what stocks I like in a day or two.

Portfolio Activity

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Portfolio News - (In Case You Missed These Headlines)

AbbVie (ABBV)

Avangrid (AGR)

Air Product (APD)

Apple Hospitality (APLE)

Preferred Apartment Communities (APTS)

Brookfield Renewable Partners (BEP)

Chatham Lodging Trust (CLDT)

EPR Properties (EPR)

Johnson & Johnson (JNJ)

Microsoft (MSFT)

Newtek Business Services (NEWT)

Phillips 66 (PSX)

Sabra Healthcare REIT (SBRA)

Service Properties (SVC)

VEREIT (VER)

Walmart (WMT)

Interesting Blog Posts or Articles

Blog Posts

Articles

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