After a pretty big spike in price today, I decided to sell all of my CAG shares. As you can see in the photo above, it was a relatively small position. I was able to make three weekly purchases, two under $30, one just over $30 last summer.
The dividend hasn't been raised for a couple of years, but ironically the stock performance has been very strong. In fact between KRFT and CAG, the food companies have been two of my better performing companies in the last year.
Including the four dividends I received I will clear $2756.57 on an investment of $1850.
I haven't decided what to do with the proceeds yet. I may add to my KO or PEP positions and keep the money invested in some type of food company.
Also CAG was paying a $.25 quarterly dividend, so my yearly dividends will decrease by $63.84.
What do you guys think of my decision to dump CAG?
I noticed teh spike today too...apparently Jana took a big stake in teh company - which they are in it just for a quick buck and nothing else. They tried the same with Agrium and eventually closed their position after the company stood their ground.
ReplyDeleteR2R
R2R,
DeleteIt looks like food companies are hot right now. First the Kraft merger and now Conagra is getting some action. The dividend hasn't risen since 2012. That could change, but I never considered CAG a core position. I will be making other moves this year to both offset the taxable gain and tighten up the portfolio.
MDP
MDP,
ReplyDeleteNot a bad sell here. If they haven't raised the dividend in some time and the yield wasn't there anymore - You are going to invest into something that has potentially more value to your portfolio. Just now have to shift some capital around is all... and also potentially pay the tax man!
-Lanny
Lanny,
DeleteThe dividend has been the same since 2012. As far as the tax man goes, I will offset the taxable gain with some losses later this year.
MDP
Nice profit on CAG. KO might start looking really good again under $40. Wouldn't mind adding some more myself.
ReplyDeleteDivHut,
DeleteKO dipped into the 30s for a very short period last week. I think that would be a great place to add more shares as well.
MDP
Hard to argue with a sell here. I probably would do the same. Nothing wrong with re balancing when the time is appropriate. Especially if you can increase your forward divs with better prospects!
ReplyDeleteAdam,
DeleteThanks. It is difficult to pull the sell trigger.....whether it is gains or losses. I haven't decided what to reinvest in, but most likely it will be another food/beverage company with a higher yield and hopefully better dividend growth prospects.
MDP
MDP,
ReplyDeleteNice move there. Great time to get out of CAG. I've looked at the stock from time to time and always found the fundamentals (as well as the lack of dividend growth) troubling. Gotta love a nice opportunity like this to move the funds elsewhere.
Cheers!
DM,
DeleteThe company seems a little weak, but the stock has been a monster over the past year. I agree that there are better dividend opportunites out there and will likely reinvest in another food company. Make a company that specializes in sweets like HSY! :-)
MDP
It's probably a good thing. CAG will likely revert to the trend line.
ReplyDeleteBut you have tax implications. I prefer index ETFs so I do not have to think about these stocks daily.
NNL,
DeleteETFs do have their positives....namely automation. It is nice not having to track things all the time. I actually have 100 shares of DVY and it has done well for me. I may add more in the future. Most likely a cross between VTI and BND.
MDP
MDP,
ReplyDeleteThat makes perfect sense what you did there, and it came with a nice windfall of cash. That's pretty hard to complain about. I am sure we'll see a nice large purchase in the near future now.
- Gremlin
DG,
DeleteI would like to think that I am going to sit on the cash for a while, but I probably won't. I might though. :-)
MDP
Looks like a good move indeed! I would definitely add in KO if price is still undervalued (it was about 1-2 weeks ago when I last looked!).
ReplyDeleteCheers,
Mike
Mike,
DeleteCoke has jumped up a bit and is around $41. It probably is still a good long term value. I ended up adding to my WPC position. REITs look attractive and a bit scary at the same time. It kind of reminds me of oil companies a few months back....or maybe today :-)
MDP