Author Archive: Meter Man

June 2017 Dividend Meter Update

June 2017 Dividend Income

It’s time for fireworks – the Dividend Meter portfolio broke through the $8k annual income barrier in June! Here’s how the needle on the Dividend Meter moved up $316.37 in just one month:

Date Total Annual Dividends Notes
6/28/2017 $8,018.87 GIS dividend increase, raises meter reading $7.44
6/27/2017 $8,011.43 Sold 37 JNJ, used proceeds and approx. $360 in accrued cash dividends to buy 147 shares of SWM in IRA Rollover #2, raises meter reading $122.64
6/27/2017 $7,888.79 With approximately $450 in accumulated cash dividends in Regular brokerage account, bought 8 more shares of QCOM, raises meter reading $18.24
6/9/2017 $7,870.55 Sold 50 AWR, used proceeds and approx. $100 in accrued cash dividends in Roth IRA to buy 99 SKT in IRA Rollover #2, raises meter reading $87.13
6/8/2017 $7,783.42 Sold 68 AWR, used proceeds and approx. $125 in accrued cash dividends to buy 51 CMP in IRA Rollover #2, raises meter reading $80.92

Taking Profits and Doubling Dividend Income

Johnson & Johnson (JNJ) and American States Water Co. (AWR) have been wonderful investments for the Dividend Meter portfolio. For the past several weeks, JNJ and AWR stock prices have risen significantly, pushing their respective dividend yields to historical low ranges and very close to my predetermined sell points (see screenshot of the spreadsheet below for AWR reference).  With new buying opportunities showing up on the Dividend Meter Watch List, it was a great time to sell a few shares of stock yielding 2% and use the proceeds to buy other investments yielding over 4% (CMP, SKT, and SWM).

Tanger Factory Outlet Centers, Inc. (SKT) and Schweitzer-Mauduit International, Inc. (SWM) are new positions for the portfolio.  Tanger, a publicly-traded REIT, is trading near its 52-week low, despite having announced a dividend increase in April and new share repurchase plan in May.  Tanger (SKT) has increased its dividend for 24 consecutive years.  Schweitzer-Mauduit International has traditionally been known for producing cigarette papers; however, the Company manufactures many other product lines such as medical bandages and industrial laminates. Recent acquisitions and product diversification has helped SWM reverse a trend of declining revenues within the past year.

Looking Ahead

The needle on the Dividend Meter should continue to move higher in July as dividend increase announcements are expected from:  Metlife Inc. (MET), and Discover Financial Services (DFS).  Be sure to check in again next month to monitor the progress.

 

Dividend Meter Spreadsheet as of July, 2017

 

May 2017 Dividend Meter Update

May 2017 Dividends

Only four spreadsheet entries to report for May, so this month’s update will be brief. Projected annual dividend income broke through the $7,600 and $7,700 barriers!

Date Total Annual Dividends Notes
5/26/2017 $7,702.50 With approximately $460 in accumulated cash dividends in IRA Rollover account #1, bought 8 shares QCOM, raises meter reading $18.24
5/4/2017 $7,684.26 PEP dividend increase, raises meter reading $3.36
5/4/2017 $7,680.90 Sold 25 WM, deposited $1,000 towards Roth IRA (completes 2017 contribution), and added $60 in accumulated dividends to buy 76 UFS, raises meter reading by $83.66
5/2/2017 $7,597.24 AAPL dividend increase, raises meter reading $18.00

The largest dividend income increase, $83.66, came from adding a new $1,000 cash deposit to a Roth IRA, selling 25 shares of Waste Management (currently yielding about 2.3%) and then using the total proceeds to buy 76 shares of Domtar Corporation (symbol: UFS). Domtar currently offers a dividend yield of approximately 4.4% and is a new position for the Dividend Meter portfolio. In addition to producing numerous paper products, Domtar also makes many disposable, recurring-purchase items such as medical gowns and diapers, including adult incontinence products, which could be a growth opportunity for the Company.  After a few years of declining revenue, UFS needs to find a growth catalyst to replace lines of paper products that continue to be digitized.

With 2017’s Roth IRA now fully funded and no additional deposits planned for the rest of the year, increases to the Dividend Meter income stream will need to come from dividend increases, reinvestment of dividends, and strategic sales of low-yield stocks with accompanying buys of higher yield opportunities. Be sure to check in regularly for updates and have a great summer.

 

April 2017 Dividend Meter Update

April 2017 Dividends

It’s time to check out the Dividend Meter Spreadsheet to see what happened in April.  Here’s a summary from the History tab:

Date Total Annual Dividends Notes
4/28/2017 $7,579.24 Sold 30 WM, used proceeds and approx. $250 in accrued cash dividends to buy 36 CMP in IRA Rollover #2, raises meter reading by $52.68
4/27/2017 $7,526.56 AVY dividend increase, raises meter reading $3.20
4/27/2017 $7,523.36 JNJ dividend increase, raises meter reading $13.92
4/19/2017 $7,509.44 OHI dividend increase, raises meter reading $11.04
4/12/2017 $7,498.40 Added $2,000 to Roth IRA towards 2017 contribution, bought 25 PII, raises meter reading by $58.00

April Highlights

Compared to last month’s meter reading, total annual projected dividends rose $138.84 in April. Two new positions were added to the portfolio (identified by the Watch List as trading in their respective high-yield dividend zone): Polaris Industries (ticker symbol: PII) and Compass Minerals International (ticker symbol: CMP).

Polaris Industries makes snowmobiles, jet skis, motorcycles (heard of Indian motorcycles?), and other off-road vehicles. In addition, the Company sells parts and apparel related to recreational vehicles. PII’s stock price has been depressed the past months due to numerous product recalls; however, Polaris keeps growing revenues.  After studying the historical dividend yields for Polaris, a buy-yield of 2.9% and a sell-yield of 1.8% were set for the Dividend Meter Watch List.   When Polaris’ stock price recently dipped into the upper 70’s and low 80’s in April, it was showing a dividend yield of 3% and became a buying opportunity. 25 shares of PII were purchased with a cash deposit of $2,000 towards a 2017 Roth IRA contribution (only $1,000 left to contribute for 2017!).

Compass Minerals International, Inc. produces salt products (primarily road deicer salt) and plant fertilizers. The Company has raised its dividend each year for twelve years in a row, and examining the yield charts, appears to be a good buy when the yield is over 4% (For the Dividend Stocks Watch List, the buy-yield is set to 4.1% and sell-yield at 2.5%).  To fund the purchase of CMP, 30 shares of Waste Management (WM) were sold from the portfolio.  Waste Management has been such a great investment – it’s a difficult decision to sell any shares of WM, but the stock has run up significantly over the past few months and is trading near a historically low average dividend yield. Fortunately, 90 shares of WM are still held in the Dividend Meter portfolio.

Looking Ahead to May

Barring any surprise dividend cuts, the meter reading for the Dividend Meter portfolio should break the $7,600.00 barrier in May.  Tomorrow, May 2nd, Apple (AAPL) will report quarterly earnings and will likely announce a dividend increase also.  Apple’s share price has steadily increased during the past few months and has reached the Spreadsheet’s sell-yield signal of 1.6%. With a new dividend increase, Apple’s yield should move above 1.6% and all shares will continue to be held in the portfolio. Good luck to all with your investing and be sure to check in again next month.

 

Dividend Snowballs and March 2017 Dividend Meter Update

March 2017 Dividend Meter

No April Foolin’ – the Dividend Meter broke through the $7,400.00 barrier in March! Here’s a summary of last month’s activity which resulted in an increase of $179.32 in annual dividend income:

Date Total Annual Dividends Notes
3/22/2017 $7,440.40 Bought 29 shares of F in IRA Rollover #2 with just over $300 in accumulated cash dividends, raises meter reading $17.40
3/21/2017 $7,423.00 With $800+ in accumulated cash dividends in IRA Rollover account #1, bought 14 shares of QCOM, raises meter reading $31.92
3/13/2017 $7,391.08 Added $1,500 to Roth IRA towards 2017 contribution, bought 30 DIN with new deposit and some accumulated cash dividends, raises meter reading by $116.40
3/7/2017 $7,274.68 QCOM dividend increase, raises meter reading $13.60

DineEquity, Inc. (DIN) is a new addition to the stock portfolio and an investment idea that came from the Dividend Meter Watch List. DineEquity operates and franchises two popular restaurant brands:  IHOP and Applebee’s.  The stock has plunged nearly 50% from a 52-week high of $94.30, trading recently around $55 per share, with a current dividend yield over 7%. While business has remained steady at IHOP, performance at Applebee’s has been disappointing, and upper management has recently left the company.  DIN is definitely a speculative high-yield play – let’s hope new management can turn the ship around and keep the dividend intact.

Real-life Dividend Snowballs

Last month, a member of the Dividend Meter community used the term “snowball” to describe the compounding effects of dividend growth investing.  With regards to the Dividend Meter portfolio, a snowball is beginning to form, but it’s not quite rolling downhill…..yet.  Until next month’s update, I wanted to leave you all with a few motivating real-life dividend snowball stories:

How One Normal Lady Turned $200 into $7 Million

UPS Retiree Donates Fortune to Education

Here’s How a Janitor Amassed an $8M Fortune

The Remarkable True Story of a $146,194-Per-Year Income Portfolio

Seattle Man who Wore Clothes with Holes, Clipped Coupons Leaves $188M to Institutions