Earlier this afternoon I purchased 45 shares of Aflac (AFL) for a $50.15 each. After commission, my cost basis is $50.33 per share. These shares will provide an extra $63 in annual dividends before reinvestment or future dividend increases. Aflac is a dividend champion with 30 consecutive years of dividend growth with a 10 year dividend growth rate of 19.3% and a 1 year dividend growth rate of 8.9%. Their current payout ratio is a very low 22%.
Since Aflac is going ex-div on Wednesday I'll be receiving their next dividend payable on March 1st. Unfortunately this won't be diversifying my dividend payouts since most of the companies I own pay on the Mar, Jun, Sept, Dec schedule but I'm not worried about that yet. This most important part is investing in solid companies that have great prospects to continue raising the dividend. The YOC for my entire FI portfolio remained the same, but for my non-ESPP share portfolio it lowered from 3.22% to 3.20%. My forward 12 month dividends for my FI portfolio now sits at $1,890.20. This is over 10% coverage of my total expenses from 2012.
Aflac has been on my radar for a long time and I've been kicking myself for not picking some up in the $30's or $40's. I was debating myself as to whether I should sell a put to start my position or if I should go on and purchase some shares, especially since there's some pretty enticing put options giving 10%+ annual returns or cost basis' in the $48 range. Since I hadn't made an outright purchase yet in 2013, I decided to go on and pick up some shares. I still might sell a put in the future, but I think the market is at least due for a breather if not a pullback so I'm holding some more cash rather than getting it working right away.
I've updated my portfolio to reflect the new purchase.