August purchases & App I use

13 shares of Chevron (CVX) (Energy)
15 shares of Fastenal (FAST) (Industrial)

CVX and XOM are at all time lows.  They may even dip lower due to Hurricane Harvey, but their returns are fantastic.  My account jumped about $50 a year with the chevron purchase.  Fastenal is my first foray into Industrial.  It is a bit cyclical, but with the repairs in Texas, infrastructure development on the horizon, and of course the tax breaks which will help all our stocks, I feel this is a good buy.  Grainger is listed as Industrial, but they seem too much like retail to me.  FAST has some wholesale aspects as well as retail, but since they are manufacturing as well, it was more attractive.  I hope to get at least one more in each sector, XOM seems the most solid and likely one in the energy sector, although VLO is attractive as well.  For industrial, I'll just wait and see.

I want to share an App that I use that is very good for tracking real-time stocks on my tablet and phone.  It is called My Stocks Portfolio, and is worth paying the guy for it (to turn off ads).  Check it out and let me know if there's anything better out there.  It allows for watchlists, but I use my broker for that because it has more research data.  However, since my broker doesn't provide me with real-time data (15 minute delay), this works just fine.

September is historically a bad month for stocks, and with the Korean/Harvey news, this month may not surprise us.  It is possible that Trump has waited until this month to push tax reform based on the reason of history, so people will be more accepting of it, but only time will tell.  I am trying to make some financial decisions as well.  I am in a position to pay off my 401k loans to have about 16% more come to me in my paycheck, or I could just take this disposable capital and invest it in dividend stocks which makes it more readily available if I needed to pull it out.  I am of the mind that bringing home more money will help me make wiser, smaller decisions over time with investments, but it irks me that once I put that money into my 401k (which will happen eventually anyway as I pay off the loans) I can't touch it anymore.  Frozen assets :)  I will wait and see if the tax cuts happen and when they take effect.  Trump could use Harvey to make tax cuts retroactive to this year, but of course he will be criticized for politicizing the tragedy, so for PR reasons he may not.  It would take someone else to suggest it and take the heat for it to be pushed ahead.  But I digress.  I will be updating my graphs by the closing bell today.

Recent Buy: CMP - Sell: KO - And an explanation

Alright, I know what you are thinking... this guy isn't a dividend investor!  He's a day trader!

Ok, I guess I owe at least one of you an explanation (you know who you are).

When I first started out, I had listened to Richard Stooker's book Stock Market Investing for Beginners  on Audible.  I have Audible because of my total one hour commute - and from time to time I like to listen to some non-fiction.  Not often, mind you, but I was recently turned off by the second chapter of Ready Player One and returned it to see if I could learn more about the market.

His book is a great primer for explaining most basics of the market, but the narrator was pretty bad - I think he was a voice synth program reading the book - but I digress.  It prompted me to research and Young Dividend and Stooker were my early influences for my original $20k purchases.

I then was researching what I knew about dividend stocks, which was about half of what I should, while learning as I went.  Last month, I bought Get Rich with Dividends: A Proven System for Earning Double Digit Returns.  The title originally turned me off - it sounded like some title for a pyramid scheme.  However, the reviews were glowing, and since I can return books I don't like, I dove in.

It was easily the best book for filling in the spaces I needed.  In addition, it was written 2 years ago, so many references were relevant.  I had to smile and laugh when many of my stocks were mentioned as examples, and even the company I work for was mentioned.  The man has a sense of humor as well, which helps with some of the dry areas (like Puts and Holds - a chapter I didn't think was useful).  However, he covers everything from REITS (like my O), MLPS, Foreign Stocks, and he even takes a stab at taxes, all while reminding the reader he is NOT a tax expert.

I knew about the Aristocrats, but I was unaware of David Fish's list of Dividend Champions, Contenders, and Challengers.  Utilizing this list, I had seen that Unilever (UN) had fallen off the list due to a cut in dividends.  Thus I sold it - if I didn't earn enough to cover my fees, I would have hung onto it - I'm not into the business of losing money.

Today I finished the book, but last night on the drive home I learned about Payout Ratio.  It is what percent a company gives of its earnings to pay for dividends.  I checked all my stocks last night - all were fine (30-75% mark) except for O and KO (Income Realty Corp & Coke).  O was ok though, because it is a REIT and that is how they work.  But Coke... uh oh!  Here is a good list of the levels:  http://www.dividend.com/dividend-education/what-is-an-ideal-payout-ratio/ and Coke was at 148%!  Now, this may be all fine and good for Young Dividend, as he started a while ago and is more invested, but as a person starting out with just my picks for future investment, it was a warning sign.  Coke is definitely in a position to cut dividends.  After all, they were at 99% a few quarters ago, so the cost is creeping up.  People are drinking less soda, and there's fewer markets available to capitalize on in a short time, so maybe not a good idea for someone like me just starting out.  Now I'm sure Coke will figure something out, but in case they don't and cut dividends like Unilever, I figure I should take my money elsewhere.  I was $25 up so my trading costs were covered.  I checked the list of Contenders, and decided on a salt mining company, Compass Mining (CMP).  All their technicals were good - and I need another Basic Materials sector stock.  The only negative is that it is cyclical (salt for winter), but a pretty dependable cycle.

In the end, I am making more dividends ($650-660 annually) with better stocks.

And here I am today.  I am looking forward to two weeks from now, when I will be adding about $3k to my portfolio.  I hope to obtain about $1k worth of some more expensive stocks, or some combination to continue and diversify my portfolio to 30 stocks.  I have decided to add another page with links to Fish's list, and other items I will use on a typical stock decision day.

Recent Buy: TGT - Sell: UN, ZN

Zion Oil (ZN) wasn't going anywhere, and the profits I had made from it (150%) was enough for me to walk away from the table.  It had been sitting for some time and that money could be better used on a dividend stock.  I also sold Unilever (UN) with its lackluster yield with just enough to break even from commissions.  While I enjoy this company being overseas (I need a few more international stocks), it has fallen out of favor with the dividend community.  Maybe in a few years...

I had been hemming and hawing with my wife about Target stock (TGT) for the past few weeks, and as I was going through the list of dividend champions, contenders, and challengers, it showed up.  I was searching for higher yield stocks to crank up my yield average - which I should be doing since I am "under the gun" time wise - and it stood out.  Good beta, good dividend yield, aristocrat (how did that happen??), good P/E, lower today due to Macy's earnings... I couldn't find a fault with it except it was Target (I've never been a fan), it was retail (a sector I'm not a fan of), and it was cyclical.  I decided to just get it and get it over with - it is the best looking retail stock out there, with Home Depot (HD) the best looking for growth.  I'm 14 shares in before the holiday ramp, and will add more probably after the holidays when it goes back down.

I am prepared to be done with retail with two stocks in that sector.

I had mentioned before I wanted to buy both Home Depot & Lowe's.  After doing some research - it appears Home Depot has some growth possibilities, but Lowe's does not.

Now that I have a solid base, I will be aiming for higher yield stocks on the CCC lists for my next 10 stocks.  I am hoping to make a large purchase of 2-4 stocks by the end of the month to help bring my average yield higher.

I can't seem to find a tech stock I like.  I don't expect to buy from that sector anytime soon. 

I'm Assessing the situation

Update:  My MO ownership is 9 shares.  I prefer to buy double digits of any stock, but I had to jump on the price.  The price has remained relatively flat since, I may just buy again after my next bi-weekly deposit.  I have finally aligned the transfer between institutions so that the money arrives on Monday, the best day of the week to buy (got to make that dollar go farther).  At over 22k in, I have an annual income of about $640.  As time goes on, I should have more buying power reinvesting dividends, and hopefully the dividends will grow.

Benchmark:  Comparing to YD at his August 2014 portfolio:
 I have:  19 different dividend stocks
He had:  17 (I don't count his Roth which he has recently done away with - I have no use for a Roth either with my situation - see "About Me")
I have: $22135 invested
He had: $25952 invested.  I may be able to catch up to that this month, I have some "ships" coming in.
I have:  Average yield of 3.06%
He Had:  3.82%.  I will attempt to meet or beat that with purchases later this month.
I have:  Annual Divs of ~$631.48
He had:  Annual Divs of $1039.23 Whew!  pretty impressive, considering the minor disparity on yield.
Our sectors are quite a bit (unintended to be) similar at this point, consisting mostly of staples and utility stocks.  Granted, the prices have grown dramatically for similar stocks, which could explain the div/yield disparity, but I won't let that daunt me.  While I believe there isn't a bubble, the market is just "righting" itself after the previous administration's policies (with a little capitalistic optimism thrown in), the time will come when I will be able to get some good bargains, which brings me to my...

Goals:  I aspire to the following (current) goals, in order of short to long-term:
1)  Receive four digit dividends by the end of the year.  Hit the $1k mark!
2)  Obtain 30 different dividend stocks.  I will be cutting this close if I aim for the end of the year.  Assuming I obtain 3 more stocks this month, and 2 a month thereafter, I should *just* make it.  Of course, if there are any crazy sales on what I currently own (like MO staying flat), of course I will forego this goal, but typically, diversity trumps all else.  YD currently is at 40, but for now I just want to hit the 30 mark to be fully diversified and then be more aggressive on the next goal...
3)  Obtain (over) 100 shares of each stock.  This is what I would call an "abstract goal".  I would like to obtain a "round lot" of each stock.  This is definitely a long-term goal, depending on sales and weight in my portfolio.  This is not a hard and fast rule - but if I have to choose between a lightweight vs. a heavyweight in my portfolio, or nothing particularly attractive that week, I'll just start at the cheapest stock and take it to a round lot.  With that as a base, I can start growing out from there.  This may take many years.  I will add watchlist stocks as they become attractive, but I would like to see my "children" mature above the total amount of stock of "9" (like my current MO holdings).
And finally...
4)  Make $30k (to be adjusted for inflation) a year on dividends.  This is my minimum goal, and sufficient for retiring early in central/south America, and to hold me over if I live to see my other investments kick in.  If I stay in the states, I would like to see it hit 50k.  With changes in government in various countries, inflation, stock market performance, lifestyle, this will determine my jumping off point for retirement.

Happy investing!

Smoking is Better For You

Or so it might seem.  The FDA is threatening to reduce the amount of Nicotine in U.S. sold cigs, which will make the habit more acceptable, appealing, and will offer competition to the E-Cigs.  Bizarre, right?  However, many analysts are advising against purchasing MO (Altria)'s stock because the bottom floor hasn't hit yet.  It has dropped dramatically since this news came out.

I bought it anyway.

The yield is great, and since I expect to NEVER sell the stock, I guess I'm in it for the long term effects.  However, if the dividend amount drops, I will reconsider.  Now I have positions in Philip-Morris and Altria.  Before I didn't think twice about tobacco stocks, but there is some benefit to this habit - and now it looks like it might get a lot healthier.  That might have some impact on my medical stocks (just kidding!).

I know I stated I would buy CHD next, but one thing I am learning during earnings months like July/August, that opportunities tend to pop up more.  I missed the boat on Lowe's, as it bounced back after the Amazon news.  I hope in the future I'll have more capital on hand to grab these stocks when they are a bargain.  Once the rocky road of earnings is over, I'll settle in and buy some CHD.  No promises though!