I try to be as open and transparent as I can with my investing decisions in order to give a real life example of what it takes in order to become financially independent through dividend growth investing. In order to keep track of my reasoning behind a purchase and inform you all about what's catching my eye, I have my Recent Buy series. This allows me to have a written record as to why I made a purchase for my portfolio and be able to look back and see if that holding is still serving its purpose. With the change of the month, markets have started to sour a bit which is just fine with me. On Monday, December 2nd I initiated a position in PepsiCo (PEP).
I had actually set a limit order about 2 weeks prior so I was pleasantly surprised when I noticed a purchase of Pepsi. I purchased 20 shares of PepsiCo for $83.71 each. After commission my per share cost basis comes out to $84.11. This is about 1.50% higher than my average valuation price from my stock analysis on Pepsi which I feel is a decent price. Based on the current annual dividend of $2.27 these shares carry a YOC of 2.70% and will provide an extra $45.40 in annual dividends before future increases or reinvestment. Whenever I have capital available I try to get at least a portion of it invested each month in order to continue increasing my dividends. No one knows if the market is going to drop, take a breather, or continue on it's merry ways of daily increases so I feel that I should put at least some capital to work when it's there.
I didn't get the best price that could have been gotten as the markets continued their descent to start the month off, but I feel it's a decent price to pay for a high quality company that should continue to pay increasing dividends year in and year out. I'll be looking for opportunities to average down my cost basis and also increase the weighting on par with my position in Coca-Cola. Pepsi has increased their dividends for over 4 decades in a row which is an amazing feat and testament to their operational efficiency and the increasing demand for their products.
My forward 12-month dividends increased to $3,384.90 which is 96.71% of the way towards my goal of $3,500 by the end of 2013. A little bonus is that the shares went ex-div yesterday meaning I get the next payment.
I've updated my Portfolio page to reflect this change.
Are you buying in this relatively heated market or sitting on the sidelines?