Lots of interesting news in the work side of my life this past week. The really great news is that I finally can have some resemblance of work/life balance. I have a 20/10 schedule now, so I work 20 days then I'm off for 10. This is the first time since I started this job where I can actually tell my wife, family, and friends when I'll be home other than when I've had vacation. That's a huge plus but there's no telling how long it will last so I'll enjoy it while it does. There was also news at the start of the week that our division will be sold sometime this year to help facilitate the acquisition of Baker Hughes. I'm not surprised by the announcement but it brings up a whole slew of questions and not many answers. There's rumors that General Electric could be a potential buyer which is a company I wouldn't mind becoming a part of.
On top of all that Luke continues to be very up and down. Honestly, if he could just have a stable week I would feel better. They currently think that his fluid balance is the big issue as the pulmonary hypertension has shown slight improvement, but the problem is there's very little solutions for that given his current condition. So we're at a waiting point right now while we try and figure out the best way to approach this.
I didn't get to do any investing this past week because of capital restraints but that doesn't mean I'm not on the look out for potential investments into excellent companies. While I rarely sell positions I do have two in mind to potentially end my relationship with. One shouldn't be too surprising, it's my employer Halliburton (HAL). I'm a bit wary of selling shares at a down point in the oil and gas cycle but with capital being rather tight the thought has crossed my mind. I currently have three different lots of shares that were purchased through the ESPP program. Two of them are sitting on pretty heavy losses and the other is looking nice with a large gain. Thanks to the quirky tax rules regarding ESPP's I can only logically shed some exposure to my employer with the lot that's increased in value. I don't want to pay taxes on "income" when I've suffered a loss. Selling a chunk of those shares could net me about $2k in proceeds to put to work in dividend growth companies.
The other company that I'm thinking of selling is American Realty Capital Properties (ARCP). To no one's surprise the share price plummeted after the accounting scandal and then the subsequent dividend freeze. However, the accounting issues have now been resolved and a new CEO has been announced but the dividend still sits at ZERO. As a dividend growth investor, that just won't cut it and the capital in ARCP isn't pulling its weight. Even worse is that the dividend, when reinstated, will be smaller than before the accounting scandal and will most likely move to quarterly payments. The dividend might not even be reinstated this year although I suspect that it will. ARCP has indicated that the dividend payment will be "in line with peers" which assuming $0.90 FFO for this year, the dividend would be in the neighborhood of $0.45 (50% payout) to $0.80 (90% payout) annually. That would put my YOC somewhere between 3.65% and 6.57%. Considering there's comparable yields from companies that don't come with the additional headache of overcoming the recent hurdles it's very tempting to close this position. However, I also know that the underlying properties are a huge asset that will be able to generate a ton of cash flow over the years once management can get things straightened out. Disposing of my ARCP position would free up just under $1,900 that I could invest into actual dividend producing assets right now. I currently have around a 21% loss that I could use to help write off against any gains from sales this year for next years taxes. I'm leaning towards selling my position in ARCP possibly sometime this coming week but I wanted to give myself a weekend to do a bit of last minute research and thinking on it.
In case you missed them, here's the posts from this past week.
Now on to the links!
Reject the assertion that you'll work longer than your parents by Retire Before Dad
Seth Klarman says this is the biggest investing advantage you can have by Sure Dividend
Gracious - April 2015 by Dividend Hustler
An accounting homework assignment for those of you who want to learn to analyze businesses by Joshua Kennon
Preparing for the future: Building a successful online business by FI Fighter
Portfolio vs dividend diversification by No More Waffles
Dividend income update - March 2015 by Tawcan
That liberating feeling of selling your bad investments by Islands of Investing
Dividend income update - March 2015 by Dividend Mantra
The value of dividend growth by Dividend Growth Investor
These 67 free dividend stock resources will make you a better investor by Sure Dividend
Quarterly review - Q1 2015 by DivGro
Quarterly update - Q1 2015 by Roadmap2Retire
Doubling down on risk by A Wealth of Common Sense
Raising the difficulty of my pullup bar challenge by Long Term Mindset
Also, if you're looking for investment ideas A Frugal Family's Journey keep an ongoing list of Recent Buys and new Stock Analyses that are worth checking out.
I hope you all have a great weekend!