Saturday, June 29, 2013

Weekly Roundup - June 29, 2013

This past weekend was wonderful and relatively cheap as well.  My wife and I went to the Museum of Natural Science and spent a solid 4 hours walking around and taking everything in.  I've been trying to get back to the museum for awhile but other things just kept coming up.  They have a great permanent exhibit that covers the Eqyptians which was very interesting.  There was actually a mummy that you could see and it was amazing to think that after thousands of years the hair could still be preserved.  We capped our time at the museum with a 40 min show at the planetarium that was set to Pink Floyd's "Dark Side of the Moon".  I don't do drugs and that was still pretty trippy to watch.

To end the night we just crossed the street to the outdoor theater there where the Houston Symphony was putting on a free concert.  We had great weather and all in all it was a great day.  Unfortunately, the dreaded work phone call came around 4 pm on Sunday which was a huge bummer.  Hopefully I should get to see my wife though this weekend so it's not too bad.

Thursday, June 27, 2013

Phillip Morris (PM) Dividend Stock Analysis

I'm surprised I haven't posted an analysis on Phillip Morris yet, but somehow it's slipped through the cracks. Phillip Morris is only a dividend challenger, but going back to the days of being part of the beast that included Kraft and Altria, the culture of increasing dividends is in place.  And we can't really fault them for increasing the dividend every year since being spun off in 2008.  Phillip Morris closed trading on June 26th at $87.54.

Company Background (sourced from Yahoo! Finance):

Philip Morris International Inc., through its subsidiaries, manufactures and sells cigarettes and other tobacco products. The company’s portfolio of international and local brands include Marlboro, Merit, Parliament, Virginia Slims, L&M, Chesterfield, Bond Street, Lark, Muratti, Next, Philip Morris, and Red & White. It also owns various local cigarette brands, such as Sampoerna, Dji Sam Soe, and U Mild in Indonesia; Fortune, Champion, and Hope in the Philippines; Diana in Italy; Optima and Apollo-Soyuz in Russia; Morven Gold in Pakistan; Boston in Colombia; Belmont, Canadian Classics, and Number 7 in Canada; Best and Classic in Serbia; f6 in Germany; Delicados in Mexico; Assos in Greece; and Petra in the Czech Republic and Slovakia. The company sells its products in approximately 180 countries in the European Union, Eastern Europe, the Middle East, Africa, Asia, Latin America, and Canada.

Tuesday, June 25, 2013

Recent Option Transaction

The markets continued to show weakness since Mr. Bernanke has hinted at slowly ending QE3.  Why the markets are taking this as a bad sign I'm not really sure.  To me that means the economy is on much better footing and it's not like they're going to completely end it right away.  I expect it to be a drawn out process.  Even if they scale back by $20 billion, that's right BILLION!, per month it'd still take over 4 months to wind down.  But as the markets turn south my mouth starts to water as can be seen with my recent purchases of CVX, XOM, PM, KO, and WMT.  The common theme there is quality at reasonable prices.

Monday, June 24, 2013

Recent Buy

I'm reporting another purchase from Friday to go along with my purchases of Chevron and ExxonMobil.  This one came right before the close of trading and was very much welcomed.  I didn't get the cheapest price because I missed out on following the market during the 2 big drops last week, but quality time with family came first.  And I still got some good deals.  I've been trying to focus on adding to current positions rather than initiate new ones and luckily most of those have been going on sale.  What a strange turn of events June has brought.  At the beginning of the month I was frustrated about having way too much cash on hand and now I'm sitting here wishing for more.  I still have enough free cash to make another purchase or two but I can't go overboard due to my open option positions, especially since they were sold on margin.  Anyways, let's get into the details.

Sunday, June 23, 2013

Expiration Friday

The third weekend of each month brings about expiration Friday for anyone that uses options as part of their investment strategy.  Some people like to use covered calls to generate extra income, but I'm not a fan unless I'm trying to exit the position.  I just don't want to lose my dividend income and solid entry price for a bit of extra income.  I prefer to sell puts since it's either setting a limit order for a company I want to own at a price I'd be purchasing or I get to collect some extra premium if it expires.

Saturday, June 22, 2013

Weekly Roundup - June 22, 2013

Well I made it back home safe and sound last Saturday around noon.  I got a much later start on the drive back and didn't get on the road until about 1030 PM New Mexico time.  Considering I was hoping for about 2-4 PM that was a big difference.  I was able to knock out about half the drive though before it just got too hard to keep driving.  It probably wouldn't have been as bad if there was a bit more to keep me awake, but there isn't a whole lot in southeastern New Mexico and west Texas.

Once I got home I was able to take a short 30 minute nap and then it was time to get ready for the barbeque that my wife was having.  It was great to get a chance to be with some friends and just enjoying life on a nice sunny day.

Friday, June 21, 2013

Recent Buys and a Dividend Increase

With more news of the Fed possibly tapering on their QE infinity, interest rates have started to move higher.  This has brought about some shakiness in the stock markets which is music to my ears and has allowed me to add to some recent new positions.  I doubled my total position size in both ExxonMobil and Chevron that I started within the past few weeks.  My cash had been sitting relatively idle thanks to the markets' run-up so far this year but I've slowly been starting to get more invested as the markets begin to waver a bit.

Sunday, June 16, 2013

Recent Buys and a Dividend Increase

Well further weakness in the markets has allowed me to start or add to positions.  I didn't go very heavy into any of these positions with the recent buys being in the $1,500-1,700 range.  Typically I like to make larger purchases to help mitigate the effect of commission, but I chose the smaller purchases because the shares in some high quality companies were only trading at reasonable levels.  Although not quite at undervalued levels.  Earlier in the week I initiated a position in ExxonMobil and on Thursday I added to my positions in Coca-Cola and Wal-mart.

Saturday, June 15, 2013

Weekly Roundup - June 15, 2013

This has been a great week.  With the recent additions to my portfolio, the invested value of my FI Portfolio crossed the $110k mark but we'll see what Mr. Market does to keep it above that level.  But the best part about this week is that this job is over now.  It's going to be a pain driving all the way home, hopefully almost straight through, but it'll definitely be worth it.  We're having a BBQ with friends today so hopefully the weather will be nice and I'll be home in time for it.

Friday, June 14, 2013

Recent Buy

On Wednesday, June 12th I picked up some shares of ExxonMobil (XOM).  I've been trying to become a part owner of this company for a long time but the initial yield is what has kept me from doing so.  Since my cash has continued to build up during the market run up I took advantage of a bit of weakness in the markets and XOM's share price to put some money to work.  You can only build cash to a certain point before you're losing out by not being invested.  I drew a line in the sand and decided that on the next dip below $90 I'd finally become a part owner in this wonderful company.

Thursday, June 13, 2013

Wal-Mart (WMT) Dividend Stock Analysis

It's been over a year since I last looked at Wal-Mart (WMT) and I like what I see.  I actually missed picking up some shares yesterday by $0.01.  The joys of setting limit orders.  I wanted to revisit this dividend champion discount retailer.  Wal-mart closed trading on Wednesday, June 12th at $74.84.

Company Background (sourced from Yahoo! Finance):

Wal-Mart Stores, Inc. operates retail stores in various formats worldwide. The company operates in three segments: Walmart U.S., Walmart International, and Sam's Club. It operates retail stores, restaurants, discount stores, supermarkets, supercenters, hypermarkets, warehouse clubs, apparel stores, Sam’s Clubs, neighborhood markets, and other small formats, as well as walmart.com; and samsclub.com. The company’s stores offer meat, produce, deli, bakery, dairy, frozen foods, alcoholic and nonalcoholic beverages, and floral and dry grocery; health and beauty aids, baby products, household chemicals, paper goods, and pet supplies; and electronics, toys, cameras and supplies, photo processing services, cellular phones, cellular service plan contracts and prepaid service, movies, music, video games, and books. Its stores also provide stationery, automotive accessories, hardware and paint, sporting goods, fabrics and crafts, and seasonal merchandise; pharmacy and optical services, and over-the-counter drugs; shoes, jewelry, accessories, and apparel for women, girls, men, boys, and infants; and home furnishings, housewares and small appliances, bedding, home d├ęcor, outdoor living, and horticulture products. In addition, the company’s stores offer tobacco, tools and power equipment, office supplies, office and home furniture, grills, gardening products, toys, seasonal items, mattresses, and small appliances; and wireless, software, video games, movies, and music products, as well as operate gasoline stations, and tire and battery centers. Further, it operates banks that provide consumer financing programs; and offers financial services and related products, including money orders, prepaid cards, wire transfers, check cashing, and bill payment. As of June 3, 2013, the company operated approximately 10,800 stores under 69 banners in 27 countries and e-commerce Websites in 10 countries.

Wednesday, June 12, 2013

Recent Option Transaction

Well the markets have started to waffle a bit which is good for those of us looking to acquire stocks.  Recently Caterpillar has sold off again to the low $80's thanks to concerns of slowing growth in China.  The forecast was downgraded to a "meager" 7.50% from 7.75%.  So in other words a rounding error as far as I'm concerned.  There's too much that goes into predicting the growth of a company or a country for that matter to be all that accurate.  With the weakness in Caterpillar, I took the opportunity to sell a put option to either added income or to get a very solid entry price.

Monday, June 10, 2013

Net Worth Update - May 2013

Despite a rough last trading day of May, the markets continued their climb higher.  As more and more of my net worth becomes tied to the markets, the gyrations have a greater effect on the value of my net worth.  In the end, I'm focused on the long run and increasing the cash flow from my dividends.  While I like to see the combination of a high savings rate and positive market moves increasing the value, a temporary 10% cut to my portfolio would be much appreciated.  The change in value was due to around $1,240 in combined 401k contributions, $900 in ESPP withholding, over $6,550 in savings from my take-home pay, and then dividends, interest and market appreciation accounted for the rest.

Sunday, June 9, 2013

Weekly Roundup - June 9, 2013

Well it was time to head back to work again.  This time in sunny southeastern New Mexico.  It was a fun 11.5 hour drive from my house in Houston to near Carlsbad but luckily I didn't have to drive it straight through.  They paid for a travel day so I knocked out about 9 hours of the drive on the first day and then rest the next day so it was an easy drive.  It's definitely not something I'm looking forward to doing again but if I want to get home again it'll have to be done.  Luckily this job should only be about a week long and if it works out right, then I'm going to have my wife meet me somewhere in central Texas so we can go camping over next weekend.  It'll be great to get to spend some one on one time with her out in nature.

Thanks to everyone that mentioned Passive-Income-Pursuit this past week.  I truly appreciate it and couldn't help spread the word about DIY dividend growth investing without your help.  I also started reading The Single Best Investment by Lowell Miller and I do have to say it's a very easy read so far.  Much easier than The Intelligent Investor and I would consider both required reading for anyone that is serious about investing in individual stocks on their own.

Saturday, June 8, 2013

Recent Buys

On Wednesday, June 5th I made 2 buys of some dividend champions in Coca-Cola (KO) and Proctor & Gamble (PG) after further weakness in both shares.  Neither purchase was made at my ideal price points but I'm still happy to add to 2 very solid companies with solid entry points.  I've been struggling with whether it's better to wait for the bargain prices or not and thanks to some of the comments from the readers I went ahead and made these two purchases.  In the long run, I don't think it will matter that I paid a little too much and the added dividend income from these purchases and continued years of increases will more than make up for waiting for the perfect price.

Wednesday, June 5, 2013

How long should you keep building cash?

I wanted to elicit some help from my fellow bloggers and dividend growth investors on an issue that's been bothering me, especially in the current market environment.  So thanks in advance to everyone.  I happened to miss the dip in price on several high quality companies such as Coca-Cola and Proctor & Gamble early Monday morning and therefore didn't get to purchase any shares.  Although I would have purchased had I set my limit orders the night before.  Being a dividend growth and value investor, I'm always conscious of trying to pay fair value and usually less with an additional margin of safety built in to my purchase price when I analyze a company.

Tuesday, June 4, 2013

Income Update - May 2013

May has now come and gone.  It's hard to believe 5 months of 2013 has already passed us by.  It was a solid month as far as budgeting is concerned.  Despite not really tracking my expenses as they came during the month, I'm quite satisfied that there wasn't a significant jump.  Rather I'd just consider the additional spending as noise as it wasn't a considerable amount.  My minimum expenses for May came in at $1,399.65 and increased the average for 2013 slightly higher to $1,376.01.  My goal for the year was to have them to average less than $1,400 per month, so they are staying in line.  Although May's were just barely under.  My total expenses have varied a lot this year ranging from $1,450 to $1,600 which is a larger range than I expected.  By the end of the month I spent a total of $1,574.54 which ended up increasing the average to $1,533.22.  I'm okay with this level of total expenditures, although I know I can do better.  Overall it was a steady as she goes month.

Sunday, June 2, 2013

Dividend Update - May 2013

Somehow the first 5 months of the year are already over and done with so it's time for my favorite monthly update, the dividend update.  May wasn't a special record setting month by any means but it was a 37% improvement over February 2013 and a 209% increase over May 2012.  All I can really hope for is to continuously make progress each and every month.  Only one of my recent purchases helped out with May's payments and that made up the majority of the increase.  I purchased 18 shares of CAT in April.  May was a quiet month for purchases with only 2 small buys, 40 shares of MSFT and 15 shares of CVX.  That's what happens when a value/DG investor collides with a seemingly never-ending bull run.  The rest of the activity during May was mainly through selling or closing put options or expiring puts.

Saturday, June 1, 2013

Recent Buy

To close out May, I decided to go on and purchase some shares of Chevron.  I've been eyeing shares for a while now and finally pulled the trigger.  I think I was early on the purchase because there's still about 2.5 more months until the next ex-dividend date which should come around the middle of August but I chose to go on and make the purchase.  And of course right after my limit order triggered, the markets decided to sell off pretty hard to end the day and I could have picked up the shares for about 1% cheaper.  In the long run though that 1% won't make that big of a difference, especially since I plan on averaging down my cost basis should Chevron's share price continue to sell off.

Weekly Roundup - June 1, 2013

I can't believe that another week and month have come and gone.  Last weekend I had a great time with my wife and friends as we headed up to one of their lake houses and got to go have a great time relaxing.  And it didn't hurt that we got to go on their boat.

Unfortunately it's really spurred me on to look for property, a house, and a boat.  But now just isn't the right time for those.  Although my wife and I have started browsing for houses and will probably be looking to buy between October 2013 and February 2014.  I can't believe that as I'm writing it because 2014 will be here before we know it.  It'll be nice to have a place of our own instead of renting so we can do with the house as we please.  Eventually we'll get some property as well but that will be on hold.

I just want to thank everyone that mentioned Passive Income Pursuit this past week.  I really appreciate it and couldn't grow the blog or spread the word about DIY dividend growth investing with your help.