Friday, July 31, 2015

July 2015 Summary

Dividend Growth Stock Blog
Hello,




Wow, July is over. What a busy month! Actually, I was on vacation for most of the month with a couple of long road trips. Therefore, it was pretty amazing that I found some time to update the blog as well as completing a couple my analyses of my recent buys (I still need to work on DOV!). 

DGI Investing is "Boring"

Dividend Growth Stock Blog
Hello,


When I started DGI investing last year in August, I was very excited. I read a lot of books and blogs and started to understand the basic concepts of yield, payout ratios, importance of EPS and its relationship with the PE ratios, FCF etc. Then, I created a new account and added my first shares.


This was a very exciting time indeed. While I had invested before (401k mutual funds) this was the first time I had full control.


After the first month, I started getting my first dividends. Boy, was I jumping up and down. I was getting paid for doing nothing.

Wednesday, July 29, 2015

Caterpillar (CAT) Dividend Stock Analysis

Dividend Growth Stock Blog
Hello,




I usually screen my companies using David Fish’s CCC list. For this month, I used the following criteria:
  • Yield over Avg Yield > 1.10
  • Payout Ratio < 0.8
  • Chowder > 10
  • PE over Median PE < 1.0


Basically, the screen looks out for companies with lower than average P/E and higher than average yield. I also wanted a high Chowder to make sure that the company has enough dividend growth. Lastly, I further filtered out companies based on excellent (A) credit ratings.
You can review my July screen here:




Then, I fully research these companies and invest accordingly.


If you follow my blog, I bought 15 shares of CAT at $80 last week (before the bigger dip).


Date
Action
Security
Price
Quantity
Amount
7/22/2015
Buy
CAT
80
15
1206.95


This article is a more detailed analysis of CAT from my notes.


Caterpillar (CAT)  Dividend Stock Analysis


Tuesday, July 28, 2015

My 3 Questions

Dividend Growth Stock Blog
Hello,

With some many companies out there, sometimes it is a little difficult to find good quality Dividend Growth Stocks to invest in. This is especially the case when the market gores on a roller coaster ride and you hear recommendations from analysts and experts.
Even if you have a good strategy, the technical ratios, eg ROE, FCF, FFO can drive you nuts.
You need to filter out the noise.
Based on my approach on dividends stock investing, I ask myself the following 3 fundamental questions:


Monday, July 27, 2015

Are you a hyper saver?

Dividend Growth Stock Blog
Hello,





I read the following the other day.


"Personal Savings in the United States decreased to 5.10 percent in May of 2015 from 5.60 percent in April of 2015. Personal Savings in the United States averaged 8.39 percent from 1959 until 2015, reaching an all time high of 17 percent in May of 1975 and a record low of 1.90 percent in July of 2005. Personal Savings in the United States is reported by the U.S. Bureau of Economic Analysis."




Wow, I am shocked.


Sunday, July 26, 2015

Healthcare Property Investors, Inc (HCP) Dividend Stock Analysis

 Hello, this is Div4son,




As you know, I have been studying REITs recently to add to my portfolio. You can read about my evaluation process here.

http://div4son.blogspot.com/2015/05/evaluating-reits.html

After using my simple screen, three companies came up on the top of the list.
  • Yield over Avg Yield > 1.10
  • Yield > 4% (but less than 7%)
  • Chowder > 8%
  • Dividend growth > 5 years

These companies are: WPC, OHI and HCP.

This article summarizes my thought process for evaluating the REIT - Healthcare Property Investors, Inc (HCP).



About  Healthcare Property Investors, Inc (HCP)

Healthcare Property Investors, Inc. is a REIT that invests (via development, leases, mortgage and financing) in real estate serving the  healthcare industry. They focus on five healthcare segments: senior housing, life science, medical office, hospital, and skilled nursing.
 

Friday, July 24, 2015

National Oilwell Varco (NOV) Dividend Stock Analysis

Dividend Growth Stock Blog
Hello,




I usually screen my companies using David Fish’s CCC list. For this month, I used the following criteria:
  • Yield over Avg Yield > 1.10
  • Payout Ratio < 0.8
  • Chowder > 10
  • PE over Median PE < 1.0


Basically, the screen looks out for companies with lower than average P/E and higher than average yield. I also wanted a high Chowder to make sure that the company has enough dividend growth. Lastly, I further filtered out companies based on excellent (A) credit ratings.
You can review my July screen here:




Then, I fully research these companies and invest accordingly.


If you follow my blog, I recently mentioned that NOV is starting to look very attractive.


National Oilwell Varco (NOV)  Dividend Stock Analysis

Thursday, July 23, 2015

Portfolio Building - part 1

Dividend Growth Stock Blog Hello,

We invest because we want to make money. Either capital appreciation or dividends income. I prefer dividend income myself though I started investing a long time ago via 401k at work. 

In any case, you need to build an investment portfolio. 

There are many ways to build a portfolio. If you have the money, and the guts, you can just put all your money equally into 30 or so high quality Dividend Growth Stocks in one go and then collect and reinvest the dividends (either selectively or DRIP).

Wednesday, July 22, 2015

Recent Buys (....Again)

Hello,

Easy come, easy go. But, in a good way. 

I believe in the concept of investing regularly to grow the dividends income snowball. Therefore, as soon as I get some fresh capital, I look for new opportunities. New Dividend Growth Stocks!

The market has been up and down lately.  For the last couple of weeks, some really good companies in the industrial sector are seeing 12 months lows. 

So, let's see what's out there...


Sunday, July 19, 2015

Recent Buy

Hello,



If you follow my blog, I recently mentioned that NOV is starting to look very attractive.


I made the following purchase on July 17th, 2015:


Ticker
Price
Number of Shares
Dividend
Est Forward Div
NOV
$42.71
35
1.84
$64.40


National Oilwell Varco (NOV)  Summary


National Oilwell Varco (NOV) is an international oilfield services company that provides the hardware components. NOV’s customers are Exxon Mobil (XOM) and CONOCOPHILLIPS (COP) as well as large drilling companies such as Transocean (RIG).

Friday, July 17, 2015

NOV is looking really good


Hello,


While waiting for fresh capital to come in for my regular investments, I did a quick criteria analysis on National-Oilwell Varco, Inc. (NOV).

NOV 7/2015AreaCriteriaCheckListComment
Quality Company
Dividend Growth>5 yearsYes6 Years
ROE/Op MarginStableYesStable
Long term Avg GrowthStableYesStable
FCF over DividendsYesYesFCF covers Dividends
M* MoatWide MoatNoNarrow
M* & S&P
Credit Rating
> BBB+YesA+
Cash to Debt & Interest Coverage, Debt to EquityCash Debt >1 or Interest Coverage > 5YesCash to Debt 0.71
Interest Coverage 34.41
Debt to Equity 22.2
M* & S&P Stars> 3 Stars for bothYesM* 5 Stars
S&P CapIQ 3 Stars
Payout Ratio<60%Yes35.00%
Dividend Growth
& Yield
Dividend Yield>3%Yes4.10%
Dividend Growth>5%Yes60.10%
Chowder>12%Yes64.20%
Valuation
Yield/Avg Yield>1.1Yes3.15
Dividend Yield Theory Mid PointBelow Mid PointYesMid Point 64.39
Low Point 40
P/E Below Mid PointYesMedian 13.28 Current 8.31
DRRM~10%YesAssuming 5.5% growth; projected return=11.26%
M* Estimate<M* estYesM* 66
S&P Estimate< S&P cap IQ estYesS&P Cap IQ 58

The only negatives are the short dividend history and the narrow moat.

I will probably initiate a new position soon.

D4S

Thursday, July 16, 2015

What is your "Best Investment"?

Hello!





I recently replied to a tweet from @InvestingAutism who asked "What is the best investment you've ever made? Why?




Based on the numbers, investing in my 401k (with the company match) was indeed my best investment.


But, this is only half of the story.

Sunday, July 12, 2015

Dividend Re-Investment Experiments Part 3 - Regular Investing vs Lump Sum Investing

Dividend Growth Stock Blog
Hello,




In my previous articles of the dividend reinvestment experiment series, I discussed the importance the time component and dividends reinvestment. You can read more below:

Part 1: http://div4son.blogspot.com/2015/03/patience-and-time.html

The purpose of these experiments is to give me an idea of what to do under different market scenarios with different investment strategies and approaches. I am not trying to model real life - which is impossible in my mind.



Regular Investment vs Lump Sum Investment

Wednesday, July 8, 2015

Recent Buys (Again)

Hello,

It looks like a lot of selling these days.

When the market is all red, I see opportunities to average down and to add new positions. 

For me, it's like Black Friday - except it's the beginning of July.

Some companies seem to be always expensive. If you are patient  enough, you can wait until it is way below its fair value to make the purchase, or you can just go for it. 


Today, I made the two buys:

Wednesday, July 1, 2015

Recent Buys

Hello,



I didn't wait long. 

With the market opening up, there are many opportunities to choose from.

Therefore, it is important to have a plan on what to buy.

Based on my recent screen for July (NOV, EMR, BAX, IVZ, WMT, CAT, UNP & IBM), I increased my portfolio with the following companies.



TickerPriceNumber of SharesDividendEst Forward Div
EMR56.15301.8856.40
IVZ37.76451.0848.60
TROW77.56222.0845.76
WMT71.26251.9649.00



Mostly, I wanted to average down on my existing positions. IVZ is a new position - riskier - but with excellent growth potentials.

You can check out my analyses:
This gives me an additional ~$200 of forward dividends. Closer to my goal.

Also, I gained a new company today, Baxalta (BXLT) from the BAX spinoff. However, it didn't show up in my brokerage yet...

D4s

Long EMR, IVZ, TROW, WMT, BAX, CAT, UNP, and now BXLT