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Tuesday, June 27, 2017

Recent Buy GE and rethinking strategy for the summer.

My very first purchase of my Dividend Journey was a single share of GE. I knew very little at the time and the purchase was largely symbolic. GE was a company I knew and had a price I could afford. I felt like they were a company that would be around for a while. At the time I was trying out  Robinhood to see if I liked it. I only had $30 to invest. So I thought why not. Had I been give the opportunity to do it over I probably would have picked something else. In fact I almost sold the share twice this year, simply because I had not plans to add to it.

But then I did. This was a pure value play here. I got two shares of GE@ $27.54 per share or $55.08 The share price is relatively low for GE. There is some positive buzz around GE right now since Jeffrey Immelt stepped down. The consensus 12 month price target is close to $32. Morningstar gives GE a four star rating. The payout ratio is at 58.9 percent and the yield is a solid 3.50% The P/E ratio is a high for my liking but also near a 52 week low for GE. This signals to me the stock is undervalued. I don't love this stock overall, but at this price I'll take a nibble.

Summer Thoughts:

In other news I think I need to remind myself to be a more patient summer investor. The combination of not having to bring a lunch to work, no dry cleaning and less driving has left me with a little extra cash this month. Also being a quarter month has contributed to the flow. I've found myself with a little more cash week to week, which has contributed the the flurry of very small buys. I'm okay with it because I've mostly added to existing positions and brought down my cost basis. But being reflective, I think it might have been a better strategy to settle on one position and enter a little stronger. Especially since was spreading out a relatively small amount of money.

Friday, June 23, 2017

Recent Buy T

Not much to see here. Just grabbed another share of T at a bargain price.  1 Share of T@37.96

Income Matters

A lot of the talk on Dividend blogs is about frugality and investing a certain percentage of income. A quick look at the shared portfolios and other stories out there, will show incredible results. But I think it is equally important to look at ways of increasing your overall income. No matter how frugal you are, if your salary is capped, you will be limited. Last night I was promoted to a supervisor role increasing my salary by 50 percent starting in late August.

So how can you increase your investing pot? One of the safety officers in my school is famous for side hustles. He works during the day as a safety officer at a lower wage than the teachers. But he also works as a doorman at night and does Uber.  Overall he takes home a better salary than most the teachers around him.

For many in this world the DGI is the alternate income stream. Cut out unnecessary expenses and invest it in blue chip companies that grow their dividends. I'm 100 percent on board. But I have big ticket items like childcare and my wife's student loans that aren't going away in the near future.

I  have a career that I love. I'm not looking to retire in 5-10 years, I have too much left to give.  So my focus has been moving into a career in administration. Tonight that dream was realized when the Board of Education approved me as a supervisor.  A perk of this is that it comes with a significant salary increase.

Sadly I don't see it impacting my dividend growth investing too much in the near future. Though I do expect to make  increases. My wife has been paying more than her fair share of our bills.  With the salary increase it is time for me to step up here more. Additionally my pension payments, and health insurance spike with the increase.


So what is the plan. 

1. Pension boost -- I'm entering my 12th year as an educator. The magic number is 25 years. Once I have that service time, I'm guaranteed a pension with benefits starting at age 59.5. Now I won't be 59.5 in 13 years. But at least I will know that I have some sort of steady payments coming when the time comes. The formula for figuring out pensions for someone that started when I did is Average Salary of the last 5 years X # of years worked/55. This is a significant pension increase.

2. Double ROTH IRA. I haven't been taking enough advantage of tax free money down the road. I've been using Betterment here because it is simple. Once I have enough money, I may invest directly with Vanguard. Investing partially in index funds allow me to achieve a level of diversification that individual stocks won't allow.

3. Continue to build my DGI account. I don't think short term there will be a significant increase in my buying. But with a higher income, I'm sure I will be investing more as well.

But overall life is good. I'm moving into a challenging career that excites me, and I'm a lot more financially stable. It's nice when accomplishing career goals can also lead to better financial stability.

Monday, June 19, 2017

Planted a couple of more seeds CMP and ADM

There is no secret why I love CMP. I have been nibbling for quite a while. This was just a chance to add a share at a discount. Purchased 1 share @64.90 Which brought down my cost basis for a 3.5% yielder at a 16.316 percent P/E ratio. The number one mineral is salt used to de-ice roads and in pools. 

The second buy 1 just a single share of ADM at 42.43. A solid 3 percent yield with a 48.5 payout ratio. So it is safe for some time. 41 years of Dividend growth and just a 17 percent yield.  It's a consumer staple that is down 5 percent in the last three months. So it looked like a good entry point.

Monday, June 5, 2017

Recent Buy DFS

I initiated a position today in Discover Financial Services. A lot to like here. It's trading at 10.1 times its earnings. DFS is down 16% over the past three months and is currently trading at a discount. The yield is a little low at 2% but it has put together 6 years of growth and a Payout ratio of just 20%. The average price target for DFS is 77.02 and 20 of the 28 recommendations are a Buy or Strong Buy. Morning Star gives the stock a three-star rating. Additionally Discover has a reputation for customer loyalty and in addition to being a credit card also acts as a bank and is involved in student loans. I think there is a lot of upside here. 

I was able to get 5 shares @58.89 per share.





Let me know what you think.


Friday, June 2, 2017

Nothing like zeroing the spare cash in the Robinhood Account. Recent buy T

It's a fantastic feeling to know that all of the money in your brokerage account is working for you. I'm not writing about the money that you have waiting to pounce should the market dip. I mean the left over change in the brokerage account after a buy. One of the drawbacks to Robinhood is that I can't buy fractional shares. I understand the reason behind it. With free trades they need to make money somehow.

But by chance today I notice that T is trading at 38.85. Which is lower than my overall cost basis. I look in my Robinhood account and there is 38.83 in there. So I decided to put out a limit buy for 38.83 just to see what happened.

There it is one more share of T for 38.83. I'll take it.

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Recent Buy XOM

Story of my life. I wish I waited a day for a slightly greater discount. But I grabbed 3 shares of XOM for $69.90 on Monday. Though has been...