Expected Dividend Increases for February 2019

The first month of 2019 is already almost in the books! With that said, the month is drawing to a close. That means it's time to examine the next month of dividend increases. Prior to discussing the next month of dividend increases, I'll recap the dividend increases that we received in January thus far.

Image Source: Pexels

January Dividend Increases:

Increase #1: Realty Income (O)

Realty Income announced a 2.0% dividend increase from a monthly dividend of $0.2210/share to $0.2255/share. Overall, this was a bit below the $0.2290 monthly dividend that I was expecting to be announced. However, I'm perfectly fine with raises like this from Realty Income when we also consider that they'll raise their dividend several more times this year. Small, frequent raises add up too. This increased my annual forward dividends by $0.216 across my 4 shares.

Increase #2: Enterprise Products Partners (EPD)

Enterprise Products Partners announced a 0.6% dividend increase from a quarterly dividend of $0.4325/share to $0.435/share. This was exactly what I expected in the previous Expected Dividend Increases series. My annual forward dividends increased by $0.09 across my 9 shares.

Increase #3: EQM Midstream Partners (EQM)

EQM Midstream Partners announced a 1.3% dividend increase from a quarterly of $1.115/share to $1.13/share. This was below the $1.14 dividend that I predicted they would declare, but EQM also raises their dividend quarterly so this isn't as devastating as it would be if they only increased their dividend once per year. This increased my annual forward dividends by $0.24 across my 4 shares.


Expected Dividend Increase #1: Genuine Parts Company (GPC)

Assuming the continuation of GPC's 5.5% 3 year DGR, the company will increase its quarterly dividend from $0.72/share to $0.76/share. This would increase annual forward dividends by $0.48 across my 3 shares.

Expected Dividend Increase #2: The Home Depot (HD)

I'm assuming that HD will increase its dividend roughly in line with its previous dividend increase of 15.7%. This should result in the quarterly dividend of $1.03/share increasing to $1.19/share. This would lead to an increase in my annual forward dividends of $0.64 across my single share.

Expected Dividend Increase #3: PPL Corp (PPL)

If the past couple years are any indication, I suspect that PPL will increase its quarterly dividend by the same $0.015 fixed amount. This would result in a 3.7% dividend increase, from a quarterly dividend of $0.41 to $0.425. This would increase my annual forward dividends by $0.48 across my 8 shares.

Summary:

We added $0.546 in dividends through increases in the month of January, which would require a capital investment of $13.65 at a 4% yield to replicate. This was a fairly light month in terms of dividend increases, with all of my dividend increases being from companies that increase their dividend quarterly rather than annually, so that explains the light month. However, we can see that next month will be much more promising, with a projection of a $1.60 increase in annual forward dividends. Should my predictions in February be correct, it would require a fresh capital contribution of $40.00 to replicate the $1.56 increase in annual forward dividends, assuming a 4% dividend yield.

Discussion: 

How many dividend increases are you expecting in February? Are you expecting dividend increases from any names not mentioned in this post?

My Goals for 2019

As we've ushered in the New Year, I've spent time the past couple weeks on formulating my specific goals for 2019. 2018 was a rather notable year for me as it was my first full year of investing and the first year that I was able to take advantage of contributing to a retirement account. It was also my first full year of my first "real job" and it also marked the first full year that I began exercising 30 minutes a day, 7 days a week. I also became a Seeking Alpha contributor in the last month of the year! Finally, it set the foundation for what I believe to be ambitious goals both financially and personally in 2019 and beyond.

Starting off with financial goals, I have numerous goals that I am striving to achieve in 2019 including:

1. Collecting $550+ in dividends for the year
2. Ending with $600+ in forward annual dividends
3. Amassing $15,000 in investments
4. Buy a used compact car in cash (i.e. Chevrolet Cruze)

As I mentioned in my previous post, I collected $360.92 in dividends in 2018. This was just above my goal of $350, so I believe that I set a fairly realistic goal in that it wasn't like I blew my goal out of the water, nor did I completely fail at achieving it. I'm aiming for $550+ because although I'll be graduating in August, I won't really have access to very much capital to invest in dividend stocks until 2020 as I'll be saving the last few months of the year to purchase a reliable vehicle of my own. As such, I believe that collecting over $550 in dividends for 2019 would be a rather significant growth rate compared to 2018, given its a 52% YOY growth all while paying for education expenses, saving for a car, and paying my fairly minimal living expenses.

Secondly, ending the year in over $600 in forward annual dividends would almost guarantee that I would be able to collect at least $550 in dividends in 2019. Given that I starting 2019 at $470 in dividends, if I steadily continued to invest throughout 2019, ending the year with $600 in forward annual dividends would mean that I would collect roughly the mid point of those two numbers in dividends. This would mean that I'd collect roughly $535 in dividends, which isn't too far off my $550 goal, and would give me a high chance of achieving that goal with a bit more effort.

Although the third goal of amassing $15,000 in investments is dependent upon one variable out of my control (i.e. market gyrations), it does remind me of the second variables which are fresh capital contributions/dividends, as those also increase an investment balance. It's this reminder that will continue to inspire me to work towards the first two goals. With investments worth just over $10,000 at the time of writing this, and with nearly $3,000 of projected retirement contributions, it would take nearly $2,000 in capital appreciation to achieve this goal. Although I believe this is a goal that a bit lofty, it is still within the realm of being achievable, and I believe it will push me to my limit. It's pushing yourself to your limit that allows you to reach your full potential as a human. Nobody ever accomplished anything worthy of discussion without stepping out of their comfort zone and laying it on the line.

Lastly, on the financial goals front, I intend to purchase a used compact car in cash. Given that my father is in the automotive industry, he has kindly agreed to help me find a used car that we can fix. My first car and my current car were both wrecked cars that he bought and fixed. We got 13 years out of my 2003 Cavalier before my father recently considered selling it since we have no use for it anymore. Anyways, I should be able to find a smashed car such as a 2014 or 2015 Chevrolet Cruze for somewhere around $3,000, stick another $3,000-4,000 into it and have a 4-5 year old car with around 50,000 miles on it. This is one of the larger goals of the year as I've never technically owned a car before. As I've mentioned before, I've been quite fortunate to have my parents lend me a car to get me through the last couple years of high school and all of undergrad. It's incredibly expensive to buy/maintain a car, so having parents willing to lend you a car for over half a decade is amazing. Having a father to service a lot of the issues you run into with vehicles also saves you thousands on the maintenance category of your transportation budget.


Moreover, I have several personal development goals for my career and hobbies including the following:

1. Continue to publish at least one blog post each week
2. Publish at least 50 articles on Seeking Alpha
3. Secure an entry level accounting/finance position

On the personal development end of my goals, I'm really just seeking to maintain what I've been doing in regards to writing/blogging about what I enjoy covering. The current blogging schedule that I'm on strikes a perfect balance in my life at the moment when considering my other responsibilities in life, including work and college. And as far as Seeking Alpha goes, I'd like to publish an article every week about the most compelling investment opportunities at a particular time, in my opinion. Any type of monetary benefits that are included in this gig really are just icing on the cake. I enjoyed writing my 2,000 word analysis of Altria more than my 3,000+ word Rogerian argument for my Argumentation and Research class on why the minimum legal drinking age of 21 should be upheld (and I even chose the topic myself). In my limited time as a Seeking Alpha contributor, I've found that the community there is very insightful and helpful in testing an investment thesis. If you miss any significant risks posed to the business you're analyzing, somebody will bring it to your attention. It's this type of interaction and constructive feedback that will shape me into a better investor over time, all while enjoying the process.

Lastly, we get to perhaps the most important goal of the year. As I've alluded to a few times, I'll be graduating with my BA in Accounting in August, so I'll be looking to either move into more of a business capacity at the law firm I currently work for or I'll be entertaining the option of entry level positions as a credit analyst, accountant, etc. Living in a small, stagnant city, with an aging population, I know I won't be making the $50,000+ starting salary that an average business grad typically receives these days. I do believe that I should be able to secure a raise of at least 25% on the roughly $26,000/year I'm currently earning. I've been scoping out the local job market recently and have seen a few entry level finance/accounting jobs that are paying starting salaries of $35,000-40,000.

Securing a starting salary of this magnitude upon graduation while living at home for just over half of what the local market charges in rent would be paramount to being able to achieve my desired 60%+ savings rate in 2020 and beyond, which would further enable me to meet my longer term goals of becoming financially independent in my 30s.


Conclusion:

Overall, I believe 3 of my 4 financial goals will prove to be achievable yet not easy to accomplish. Of all my financial goals, I actually believe hitting $15,000 in investments is going to be the goal that could prove to be a reach. If the market continues its lull that it's in, there is a very good chance I won't reach that goal, but I can say that I'll do my best to hit it! As far as the personal development goals go, I don't envision any major issues in achieving those goals, provided I just continue to do what I have been doing.


Discussion:

What are your goals for 2019? Are any of your goals what you would consider a stretch?

Review of 2018 Goals

It's official! 2018 is in the books and 2019 has arrived. With that said, I thought I'd take the opportunity to reflect on the past year of goals and how I fared on my mission to achieve them.

Goal #1: Collect $350+ in dividends

Overall, I ended up collecting achieving my goal of collecting at least $350 in dividends, collecting $360.92 in dividends in 2018. Of the $360.90, I received $314.76 or 87.2% from my Robinhood portfolio. $46.16 or 12.7% originated from my retirement account, paid by my mutual fund (CAIBX). The remaining $0.96 came from my M1 Finance account that I opened in September 2018. I also ended the year with just over $470 of forward annual dividends heading into 2019. That is compared to the $186 heading into 2018, which represents a 152.9% YOY increase in forward annual dividends.

Goal #2: Reach $11,000 portfolio

Overall, my portfolio reached a peak value of roughly $10,550 for the year on December 2. This was well short of my goal, but a December that was on track for the worst December since the Great Depression until the last week or so of the trading year certainly wasn't helpful to achieving this particular goal, as I finished the year with investments worth just over $10,000. However, the great news that came out of this was that I was able to average down on my Altria position twice and recently add to my Iron Mountain position, further solidifying my forward dividend income of $470 to end 2018 and begin 2019.

Conclusion:

My goals for 2018 were fairly non-existent as I started this blog in July and honestly didn't really hold myself accountable with specific or actionable financial goals before starting this blog, aside from simply graduating college with no debt. I believe I set my goals realistically. Rather than being overly aggressive or not aggressive enough, I just barely achieved my first goal of collecting $350 in dividends. Although I fell short of achieving $11,000 in portfolio value, this was in large part because of the worst December since the Great Depression. My mindset is that if you're achieving all your goals, you aren't setting the bar high enough. Similarly, if you're achieving none of your goals, you're probably setting them too high. I have also been planning my goals for 2019 the past week, which will be the topic of next week's article.

Discussion:

What were your goals for 2018? Did you achieve them all? If so, did they end up being too easy to achieve or did you have to give it your all to achieve them?

December 2018 Dividend Income

Another month has passed and we have officially entered 2019! It really is unbelievable how quickly the year has passed us by, especially in my case. Working and blogging has kept me busy, and with school set to resume in a couple weeks, 2019 will no doubt be a busy year. Anyways, with the passage of another month, it's time for me to delve into what December provided for me in terms of dividends.

Analysis:

Overall, I collected a record $53.84 in dividends in the month of December. This represents a 21.7% growth in dividends collected compared to the $44.26 in dividends collected in September. 

This means that in 2018, I collected $360.92 in dividends between my taxable accounts and my retirement account. Of the $53.84, I received $29.85 in dividends from 12 of the 32 companies in my Robinhood portfolio. This is less than the $31.73 I received from my Robinhood portfolio in September as Pepsi (PEP) won't be paying their dividend until January.

The amount received from my Robinhood portfolio is identical to September's dividend income besides the absence of the Pepsi dividend that was discussed above, as I have received no dividend raises and invested no new capital in any companies that paid me in December.

I also received a record $0.44 from 24 companies in my M1 Finance portfolio. I haven't added any new capital to my M1 Finance portfolio since I opened it back in September, so the dividends will continue to be a rather small percentage of my total dividends. I didn't include screenshots for M1 Finance, as the dividends have been grouped together, rather than separated out in an even somewhat orderly manner.

Lastly, my mutual fund (CAIBX) in my retirement account paid a record $23.55 in dividends, with $5.15 of that being special, year-end dividends. The retirement account dividends increasing have been the constant for the end of quarter dividend income reports. Factoring out the special dividend, the $18.40 in usual dividends that I received in December compared to the $12.49 received in September represents 47.3% quarterly growth.

However, the most impressive growth can be observed when we compare December 2017 dividends of $12.80 to the $53.84 collected in December 2018. A 320.6% YOY increase that was mostly as a result of my retirement plan contributions in 2018. A quadrupling of dividend income in a single year! Sign me up for that!

Summary:

December was yet another month of considerable dividend growth. I expect this trend to continue throughout the year for every month of dividends, with end of quarter months containing the most growth due to retirement contributions. The real fun will begin in 2020 when I am several months removed from completing undergrad and will finally be able to aggressively funnel most of my earnings into investments.

Discussion:

Was December another record month for you? Did you have any new dividend payers?

Recent Stock Purchases - Altria Group (MO) & Iron Mountain (IRM)

On the day this post is set to be published, 2018 will officially be over and we will have entered into 2019. With that said, I didn't go quietly into the New Year! I made two final purchases in 2018, adding to my stake in Altria Group while also lowering my cost basis from $60.35/share to $58.43/share, and I also added to my position in Iron Mountain. Below are my screenshots of the transactions:

I won't go into too much detail in my rationale for initiating these purchases, thereby expanding my positions in Altria and Iron Mountain. My first Seeking Alpha piece fully hashes out why I believe Altria is currently an attractive investment. In short, the company's dividend is the highest it has been in years, I have confidence in the company and its ability to transform itself for the next half century of dividend increases, and I also detail the appealing current valuation.

As for Iron Mountain, I wrote a brief overview of why I initiated a position in it back in October.  Since that time, the company announced a respectable 4% dividend increase. Overall, the company has delivered on my investment thesis since I initiated the position and rewarded me with an inflation beating dividend increase. The valuation was also attractive as my cost basis of $32.03 on the previous 3 shares I owned, only increased to a cost basis of $32.09 with the addition of the 4th share. I'd like to continue to add to my Iron Mountain position as long as the price stays in the low to mid $30s, unless other more attractive buying opportunities present themselves.

Summary:

Overall, these two small purchases increased my forward annual dividends by $5.64. I deployed $81.04 in capital to my Robinhood account, at an average dividend yield of 6.96%. Factoring in my retirement contribution on the same day, that places my dividends going into 2019 at just over $470! This will also continue to help me make progress in balancing out my dividend income as both Altria and Iron Mountain pay dividends in the first month of the quarter, which has historically been my weakest month since the inception of the portfolio in September 2017.

Discussion:

Have you added either of the two names mentioned above? Or have you been adding other names? If so, what did you purchase in the last days/weeks of 2018?