Tuesday, February 3, 2015

Weekly Sharebuilder Purchases



Here are my automatic investments for this week.

  • CAT:  3.01 shares @ $82.96 --- Yield  3.38%
  • PG:  2.92 shares @ $85.69 -- Yield  3.00%
  • BAX:  3.57 shares @ $69.99 --- Yield  2.97%
  • JNJ:  2.46 shares @ $101.44 --- Yield  2.76%

Total capital invested this week is $1000 ($250 in each company). The combined yield on this week's purchases is 3.03% and will add $30.28 to my yearly dividends.

These are four relatively boring yet awesome companies which should pay dividends for many decades to come. That is so cool to think about.


Oil Rebound???

Wow! The markets have been swinging around over the place during the past week. Each day it seems like the markets have been moving in 200-300 points spurts, sometimes in both directions. Last week I missed a golden opportunity to buy Chevron under $100 on Friday as I couldn't get near a computer.

Now it looks like oil is in BEAST MODE, blowing past $51 today. This is a good thing in my opinion as I feel like I have been drowning with all the energy purchase during the past few months.

Realistically I do have a few larger positions that potentially could some have some dividend risk (BP, ESV, and BBL) so again, this is great news. Also seeing my portfolio rebounding during the past couple of days is good psychologically for me. Ultimately though it is the steady, sustainable dividend income that is the most important consideration, not the daily moves.

Of course oil could easily switch directions back to the downside, in which case I will hop back into the oil well and resume buying. Sometimes I wish I had fewer positions as I feel like I am trying to herd cats keeping track of all these positions.

Anyway, if oil remains at $50 or climbs higher, I will be looking at KO, PG, BAX, MSFT, CAT, PM, and JNJ.

Stay relentless in your pursuit of FI everyone!

24 comments:

  1. Yeah... the market has been volatile the last few days especially with huge swings. I am also adding JNJ the last few weeks and planning to continue to add as long as it stays closer or below $100. The oil stocks has started to rebound now and same goes for commodity stocks like BBL. PM was very close to 80 touching 5% yield and CVX at less than $100 was a great price. I couldn't add on Friday as well and now the stock is back at $108 :(

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    1. DGJ,

      I like JNJ around $100 as well. Yeah when I was watching CVX on Friday I also noticed that PM was barely over $80. That would have been a good price without a doubt. Hopefully well get another at bat in the near future with both companies.

      MDP

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  2. Great consistency MDP.
    Feels great collecting quality companies. It's very rewarding. Thank you for sharing this awesome journey with us. Take care my friend.

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    1. DH,

      Thanks and you're right. It feels great picking up shares of quality companies. It even feels been receiving the dividends.

      MDP

      Delete
  3. It is surprising to see oil rebound like this. Maybe its a dead cat bounce? who knows...i am not a trader and cant be bothered with guessing the direction. As you said, its the dividend income stream that matters.

    Congrats on adding another $30 to your future income.
    R2R

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    Replies
    1. R2R,

      It may be a dead cat bounce as I'm sure there is a heavy short interest right now. Any swing in currencies is going to send oil all over the place. If it drifts back down I will resume buying CVX, XOM, Shell, etc.

      MDP

      Delete
  4. MDP,
    I noticed you've been buying lots of energy companies these past few months in small increments and consistent basis, is it paying out this quick? I am expecting a longer pain for us who are heavy on oil (mine is 18% of my portfolio), we'll see if it will rebound that quick from here.
    FFF

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    1. FFF,

      I don't know if the carnage is over, but obviously after oil prices getting cut in half I would say most of the damage is done. The question now is how long will the prices stay at depressed levels? I hope they climb back up to the $70 range. I guess we will see in the coming months.

      MDP

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  5. Oil hit me right now but I'm not that surprised about the rebound. It won't stay low forever... You can resume buying, but your current holdings will for sure come back!

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    1. DivGuy,

      Yeah, while it is nice buying on weakness, it is also nice to buy with some strength developing. The prices may not be as great, but it is nice from a pyschological standpoint. At the end of the day I will continue buying under either condition.

      MDP

      MDP

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  6. Great stuff on adding more dividend into your annual income. I see the energy sector continue to be volatile for the next while. Like you, I didn't take the opportunity to invest a few weeks ago when I had the opportunity. Oh well.

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    1. Tawcan,

      Yeah, being a bit heavy in energy and low on capital is not the ideal investing positions. I think we will have some more opportunities to buy in the coming months. Seeing BBL at $38 a couple of weeks ago yielding 6.5% was crazy and probably won't happen again.

      MDP

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  7. MDP,

    Great buys. CAT has been especially weak lately. A great stock, though heavily cyclical.

    Like the healthcare additions. Increased healthcare exposure is something I need to work on for my own portfolio.

    Best regards!

    ReplyDelete
    Replies
    1. DM,

      You aren't kidding about CAT's cyclicality. I hope it doesn't bounce to fast as I am just starting my position. BAX and JNJ both look good although I wouldn't mind if the prices drop some more. :-)

      MDP

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  8. Great buys as always. You seem to stick the the very solid dividend payers as I do. Like the CAT move especially after their recent decline. That's a pretty good current yield for CAT. As always I enjoy these updates and look forward to the next.

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    1. DivHut,

      Thanks for visiting. CAT has been on my radar since late 2013, but it soared up to 110 pretty quickly. Hopefully it hangs in the 80s or lower so I can build a position.

      MDP

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  9. MDP,

    Great purchases. Often, the boring stock purchases are the best purchases. It is funny, CAT has quickly retreated from its highs last year. I stopped following the stock because I felt there were better discounts available. Now, I'll have to re-consider as the stock has dropped into the low 80s. You entered at a great time. Hopefully you will collect some dividends before the stock rebounds.

    Bert, One of the Dividend Diplomats

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    1. Bert,

      After the past several months focusing on mostly energy companies, boring can be a relief. CAT has a tendency to bouncing around pretty quickly so I hope it stays down long enough to build a full position. If oil goes back up to quickly I think CAT heads to $100. It will be interesting to see how things play out.

      MDP

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  10. Great choices! I went with HP and BBL last month - and both were rebounding very fast. But maybe oil goes down again and I can add more oil stocks. I started last year with my journey to FI and would love to initiated more positions in this down sector.
    CAT is also on my buy list, but I found HP to be more attractive at the time.

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    1. DivRider,

      Thanks for the comment. I too looked at HP last month but kept my finger off the trigger as my energy exposure is at a pretty high level. I have been adding BBL throughout the past year and will likely add more in the lower 40s.

      MDP

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  11. I think we haven't seen the worst for the energy sector. I expect prices to bounce around 40-50's for most of the year (maybe the next). If that happens we'll see some pretty terrible quarterly numbers coming up and good opportunities to buy the majors who will likely be scooping up good acreage from the less well capitalized.

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    1. Adam,

      You are right. It's not just about the price of oil, but the duration. It is one thing to see major moves in either direction, but an entirely differenent animal if the prices stay at extreme levels. The smaller suppliers will be vaporized if $40 stays with us for a couple of years. I personally think the prices will rebound to the 70s, but we'll see what happens.

      MDP

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  12. Hi, MDP.
    I'm digging all four purchases and you certainly can't beat a 3% average yield. I especially like CAT as a long term play due to its relatively low payoff ratio. Best wishes.

    Goosemann Jones
    Flight to Dividends Blog

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    Replies
    1. Goose,

      Thanks. I really like CAT here as well and it took a long time for it fall back into the low 80s. I will keep adding in this price range.

      MDP

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