Tuesday, July 14, 2015

Dividend Growth Investing at Work - Walgreens Boots Alliance


Something I love about dividend growth investing is that each month I get to hear about companies I own deciding to pay me more money in dividends.  Just for owning a small portion of said companies.  Not going and doing R&D for new products or technology.  Not selling any products.  Not managing any employees or inventory.  Not making sales calls.  All I had to do was have the foresight to invest some of my savings in excellent companies.  That's dividend growth investing at work!  I mean who really doesn't like getting a raise for doing nothing?

It's always great to hear about a dividend increase and last week I ended up getting another one.  Walgreens Boots Alliance (WBA) announced they were increasing the quarterly dividend from $0.3375 to $0.36.  That's a 6.7% increase.  This also marks the 40th consecutive year of rewarding owners with an increasing dividend.  A solid increase and a truly impressive streak.  Since I own 69.069 shares of WBA, the new dividend rate will increase my annual dividends by $6.22.  Expected dividends from my position in Walgreens are now at $99.46 which is ever so close to the $100 mark.  And that's just from one company giving out one increase.  Multiply that across a portfolio that's approaching $200k and the rise in dividends from increases alone really starts to add up.

Based on my portfolio's current yield of 3.13% this increase is like I invested an extra $198 in capital.  Except that I didn't!  One of the companies I own just decided to send more of the profits my way.  That's how you can eventually reach the crossover point where you dividends received exceed your expenses.  That's the beauty of the dividend growth investing strategy because you build up your dividends by fresh capital investment as well dividend increases from the companies you own.

My FI Portfolio's forward-12 month dividends are up to $5,973.42 and including my Loyal3 portfolio's forward dividends of $56.32 brings my total taxable account forward dividends to $6,029.74.

Image courtesy of digitalart on FreeDigitalPhotos.net.

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