Expected Dividend Increases for March 2020

As I'm writing this post, the Milwaukee Bucks are fresh off their 126-106 drubbing of the Detroit Pistons in Detroit, and are scheduled to play later tonight against the Philadelphia 76ers in Milwaukee.

As a testament to the Bucks' dominance all season long, they have a chance to clinch a playoff spot earlier in the regular season than any other team in NBA history. The Golden State Warriors became the earliest NBA team in history to clinch a playoff spot in 2017, doing so on February 25.

At 47-8, the Bucks are 26.5 games better than the 9th place team in the Eastern Conference, the Washington Wizards. The Wizards are 20-34, with 28 games to play.

A Bucks' win over the 76ers tonight and a Washington Wizards loss on February 23 against the Chicago Bulls are the required outcomes to formally clinch a playoff spot.

If things don't go the Bucks' way in the two games above, Milwaukee would still have a chance to clinch its playoff spot in a head to head match-up against the Wizards on February 24 (which is almost sure to result in a Bucks' win given that the Giannis-less Bucks managed to beat the Wizards by 20 last month as a result of Khris Middleton's 51 point outburst).

With that piece of Bucks excitement out of the way, let's delve into the actual intent of this blog post, which is to outline the dividend increases that I have received in the month of February and the increases that I expect to receive in March now that February is a few days from ending.

Increase #1: PPL Corp (PPL)

PPL Corp announced a 0.6% increase in its quarterly dividend from $0.4125/share to $0.4150/share, which was slightly below my expectation of $0.4175/share as outlined in my previous post of this series.

Even though PPL's dividend increase was below my expectation, I don't expect high yielding utilities such as PPL to offer dividend increases beyond the low-single digits, so the increase was still a welcomed one in my opinion.

Across my 8 shares, PPL's dividend increase boosted my annual forward dividends by $0.08.

Increase #2: Genuine Parts Company (GPC)

Genuine Parts Company announced a 3.6% increase in its quarterly dividend from $0.7625/share to $0.7900/share, which was once again a bit below my expectation of a 5-7% dividend increase.

Given that 2020 is fraught with political uncertainty and we're well over a decade into a phase of economic expansion, I can understand GPC's caution in dividend increases.

After all, a company doesn't become a Dividend King by overextending itself with too generous of dividend increases only to be forced to cut its dividend when the economy takes an inevitable downturn. GPC remains a well run and somewhat recession resistant company, which is precisely why I own it.

Across the 3 shares that I own, GPC's dividend increase added $0.33 to my annual forward dividends.

Increase #3: Prudential Financial (PRU)

Prudential Financial announced a 10% increase in its quarterly dividend from $1.00/share to $1.10/share, which was slightly higher than the 9% increase that I was expecting from the company.

Given that I acquired shares of PRU near their 52 week low last August, I have been incredibly pleased with this purchase. Purchasing a company with a 5.13% yield to see it surge 18% and deliver a 10% dividend increase all in less than 6 months is about as good as it gets IMO.

Across my 3 shares, PRU's dividend increase boosted my annual forward dividends by $1.20.

Increase #4: The Home Depot (HD)

The Home Depot announced a 10.3% increase in its quarterly dividend from $1.36/share to $1.50/share.

While this was quite a bit below my initial expectation of a 17.6% increase in the quarterly dividend to $1.60/share, I fully understand why HD would elect to remain cautious with its dividend increase.

With news that the coronavirus could potentially have a materially adverse impact on the global economy if the virus isn't contained and eradicated very soon, HD is completely justified in the conservative management of its dividend increase for 2020.

Increase #5: Digital Realty Trust (DLR)

While Digital Realty's dividend 3.7% dividend increase in its quarterly dividend from $1.08/share to $1.12/share was below my expectation of 6.5% and $1.15/share, I understand why DLR was cautious with its increase.

The InterXion acquisition along with the uncertain outlook of the coronavirus were likely the primary factors in DLR's decision to be conservative with its dividend increase.

Across my 3 shares, my annual forward dividends were boosted by $0.48.

Increase #6: Albemarle (ALB)

While Albemarle's 4.8% quarterly dividend increase from $0.3675/share to $0.3850/share was below my expectation, I believe ALB's conservatism will pay off in the long run.

ALB is focused on aggressively investing for future growth, so I'm entirely fine with a few smaller raises the next few years in exchange for larger increases later down the line.

Across my 5 shares, my annual forward dividends increases by $0.35.

A Dividend Surprise

Simon Property Group (SPG): Although I was expecting SPG to increase its dividend in February as it has done for the past several years, the company understandably elected to keep the quarterly dividend at $2.10/share as a result of its recently announced joint venture with Authentic Brands Group and Brookfield Property Partners to acquire Forever 21, not to mention the acquisition of the 80% stake in Taubman Group (TCO) for $3.6 billion.

While SPG's balance sheet still remains in decent shape following its acquisition activity as of late and it could have easily afforded the dividend increase that I was expecting, I have no problem with the company's tendencies toward fiscal conservatism as that is one of the qualities, along with a proven management team that makes the company a blue-chip REIT.

Expected Dividend Increases for March 2020:

Expected Dividend Increase #1: Realty Income (O)

Realty Income has been a model of consistency among not just REITs, but the dividend growth stock universe in general. Since I initiated a position in 2018, the company has yet to really surprise me in terms of its dividend announcements, and that's a great thing.

I expect March to be no different, with O raising its monthly dividend 0.2% from $0.2325/share to $0.2330/share.

Across the 4 shares that I own, this would result in a $0.024 increase in my annual forward dividends.

Expected Dividend Increase #2: WP Carey (WPC)

Sticking with the theme of reliable REITs within my portfolio, WP Carey has been an equal to O in terms of consistency.

I have yet to really be that surprised by WPC's dividend announcements in the 2 years that I've owned the company, which is just what a DGIer loves.

I expect WPC to announce a 0.2% increase in the quarterly dividend from $1.038/share to $1.0400/share, which would increase my annual forward dividend income by $0.024 across my 3 shares.

Expected Dividend Increase #3: Williams Sonoma (WSM)

Given that Williams Sonoma's payout ratio is in a good place and that the company is poised to continue its momentum into 2020, I fully expect WSM to announce a 10.4% increase in the quarterly dividend from $0.48/share to $0.53/share.

Across the 6 shares of WSM that I own, this would boost my annual forward dividends by $1.20.

Expected Dividend Increase #4: General Dynamics (GD)

Since General Dynamics' payout ratio is also in a nice range, I expect that the company will announce a dividend increase similar to last year's 9.7% increase, which would bring the company's quarterly dividend from $1.02/share to $1.12/share.

Across my 2 shares of GD, this would result in a $0.80 increase in my annual forward dividend income.

Concluding Thoughts:

February was full of surprises, which was manifested in the slightly lower than expected dividend increases from PPL, GPC, and ALB.

Fortunately, PRU's dividend increase slightly exceeded my expectations and offset much of the difference in PPL, GPC, and ALB's actual dividend increases versus their expected increases.

SPG's acquisition activity in the month of February accounted for the lack of a dividend increase, which is something I'm perfectly fine with given the company's proven track record of fiscal conservatism and delivering results for its shareholders over the long-term.

I have received $3.00 in dividend increases. This would take a fresh capital investment of $75.00 at a yield of 4% to replicate.

I am expecting March 2020 to produce $2.048 in dividend increases, which would require a fresh capital investment of $51.20 to replicate at a 4% yield.

Overall, the portfolio is continuing to make progress and advance in the right direction. As this post is published, my annual forward dividends are closing in on the $1,000 mark, with about $55 to go.

Since I am in the process of paying for my first car, gathering funds to pay my tax liability for 2019 (when I needed to estimate my income for 2019 in December 2018 for marketplace insurance subsidy purposes, I hadn't yet contributed for Seeking Alpha and ended up making about $6,000 more than I anticipated), and building an emergency fund, I expect March to be a quiet month in terms of capital deployment aside from the usual retirement contributions.

April is slated to be about as quiet as March, with May's non-retirement contributions likely to be around $500, and the rest of the year returning to the typical $1,000-$1,500/month non-retirement contributions.

Therefore, I'm not expecting to reach the $1,000 annual forward dividend mark until May of this year.

Discussion:

How did your February fare in terms of actual dividend increases versus expected dividend increases?

Were there any pleasant or unpleasant surprises on your end as far as dividend increases were concerned?

Is this March shaping up to be busier than last year's March in terms of both the dollar amount and volume of dividend increases?

As always, I appreciate your readership and I look forward to replying to any comments that you are welcome to leave in the comment section below!

3 More Lessons I Have Learned After 2+ Years Of Investing

It's incredible to think that I've been investing for over 2 years at this point as illustrated by the screenshot of Robinhood above.

As a testament to the notion that time really passes us by without us even noticing, I was somewhat planning on writing and publishing a followup post last fall to my post titled "Lessons After One Year of Investing."

I never created a draft for this blog post, so it was only now after several months have passed, that I am finally getting to writing this post. But better late than never, right?! Without further ado, I'll present 3 more lessons that I've learned over the past couple years of being invested in the stock market and dividend growth investing.

Lesson #1: Don't Underestimate The Power Of Small Investments Here And There

As someone that has been interested in the theoretical aspect of investing for the past decade, one big influence on my overall views of personal finance and even my life in general to an extent has been Joshua Kennon through the works on his personal blog and About.com (and The Balance after About.com).

Although Joshua took down many of his posts prior to launching his asset management firm, Kennon-Green & Co., there are still a tremendous amount of posts between his personal blog and The Balance.

One of the first lessons that I learned from Joshua after initially stumbling on his early work through About.com and later his personal blog, was Zechariah 4:10, which to paraphrase was "do not despite the day of small beginnings."

Even the vastest of fortunes were built from the ground up. When given enough time, small and steady investments of capital grow into significant amounts of capital that allow an individual to become financially independent.

It was the adoption of this mindset from an early age that would eventually lead me to begin investing at age 20 while I was still in college.

While I was eventually able to graduate college debt free (thanks to a bit of insight on my part and admittedly, a lot of luck as well), I wasn't too much different from most college students in that I was on a pretty tight budget throughout most of undergrad. This was especially the case because I was paying all of my tuition entirely out of pocket, which left me with limited funds to begin investing.

As a byproduct of the low commission era we live in and fintech companies like Robinhood, which revolutionized the industry by democratizing investing for even relatively broke college students like myself, I was able to begin investing in September 2017 with my initial deposit of $2,240.00 shortly before I started my final two years of undergrad.

It was from that point, I rarely invested more than a few hundred dollars a month until I finished undergrad last summer.

During that time, my portfolio has steadily grown to a value of $22,000 and is producing $934.91 in annual forward dividends as of February 2020.

While the portfolio undoubtedly has a ways to go and I'll continue to build it in the years ahead, my point is that I've definitely seen the benefits of compounding in real time over the past couple years of investing, which leads me into the next point.

Lesson #2: Dividends Sure Are Sweet

The great thing about starting your investing journey, especially as a dividend investor, is that you are able to gradually transition from an employee to an owner in real-life businesses that conduct operations throughout the globe and generate tons of cash flow, which is passed onto you as the owner in said businesses, in the form of dividends.

In my particular case, I have collected $1,104.93 in dividends since I received my first dividend from Genuine Parts Company (GPC) in October 2017.

Obviously, $1,104.93 isn't a life changing amount of money. The flip side of the coin is had I never made the decision to invest my spare capital, I would have collected zip, zero, nada in dividends.

This is cold, hard cash that can be used however I'd like it to be. While I plan on actively reinvesting all of these dividends to build the portfolio over the next 15-20 years, the option is there for me to eventually begin living off of dividends.

And building off of the first lesson in this post, the really incredible thing is that in the 28 months that it took me to collect my first $1,104.93 in dividends, I anticipate that from now until the end of 2020, I will be able to match that amount.

Let that sink in...in the barely 10 months we have remaining in 2020, I will have collected as much and maybe even a bit more in dividends than I have in the first 28 months!

If that doesn't sell the importance of investing for cash flow and why we must start investing as early as possible, I'm not sure what will!

Lesson #3: There Are Sure To Be Short-Term Bumps In The Road

What I mean by this is that when I purchased most of the companies in my portfolio, I did so with the intent of benefiting from immediate dividend growth.

Sometimes companies such as CVS Health (CVS) focus on paying down debt in the aftermath of completing a large acquisition as was the case with the company's acquisition of Aetna, which is what happened when the company announced its acquisition of Aetna just 3 months after I opened my position.

It's important to note that even though companies do freeze their dividends from time to time, that isn't necessarily a cause for concern and reason alone to sell.

In the case of CVS, the company is doing quite well since the closing of its acquisition of Aetna. Not only is CVS deleveraging, but it's also producing strong operating results.

It's these two simple reasons that lead me to believe that the dividend is almost sure to resume high-single digit growth in 2-3 years.

While things sometimes won't go as you planned they would in the short-term, you need to be patient and realize that as long as you believe the investment thesis is intact in your investments, you would be wise to continue to hold them for the long-term.

After all, the other companies in your dividend portfolio will likely be making up for the companies that have elected to freeze their dividend for a while.

Concluding Thoughts:

Investing can be intimidating because we're often misinformed that in order to begin investing, we need to start with thousands of dollars, but this simply isn't the case nowadays. Investing has been revolutionized by the likes of Robinhood and a race to the bottom in fees.

Along those same lines, although dividends begin small and seemingly insignificant, those dividends are the start to an incredible journey to achieve financial independence.

Like all things in life, investing isn't always easy and investments don't always go to plan. However, a valuable lesson I have learned in the past couple years is to hold investments for the long run so long as the investment thesis remains intact.

Discussion:

Which of the lessons did you find most helpful to learn or be reminded of in this post?

Are there any other lessons that you've learned since you began investing that I failed to mention in this post and my initial post in this ongoing series?

As always, your readership is very much appreciated and I look forward to replying to any comments that you are free to leave in the comment section below.

January 2020 Dividend Income

As I write this blog post, the Bucks are continuing with their winning ways and stand a good chance of being the third team in NBA history to achieve at least 70 wins in the regular season.

While that's all fine and dandy, the more exciting aspect of the Bucks' incredible progress since head coach Mike Budenholzer took over in the 2018-2019 season is the continued progression in absolutely destroying opponents.

The Bucks' net rating of 8.47 last season was head and shoulders above the Golden State Warriors and Toronto Raptors, which was what brought the Bucks within 2 wins of the NBA Finals and likely beating a banged up Golden State Warriors team if it wouldn't have been for Kawhi Leonard's heroics in the Eastern Conference Finals and Fred VanVleet going off on the Bucks.

If there were any doubts that the Bucks could sustain such dominance going into this season, those doubts have been crushed like many Bucks opponents have been this season. Through the first 51 games of the season, the Bucks are 44-7 and have a chance at posting the best net rating in NBA history.

It's so difficult to contain my excitement and brimming optimism toward this Bucks team, but for the intent of this blog post, I'll be examining the dividends that I collected in January 2020.

Analysis:

Overall, I collected $45.81 in dividends during the month of January.

This represents a 9.3% quarterly growth rate compared to October 2019's $41.91 in dividend income and an even more impressive 77.5% YOY growth rate compared to the $25.81 in dividend income received in January 2019.

Breaking this down further by account, I collected $38.77 in dividends from 13 companies in my Robinhood account, $6.77 from 3 companies in my Webull account, and $0.27 from 12 companies in my M1 Finance account.

There were numerous developments that were responsible for the $3.90 increase in my dividend income compared to last quarter.

Starting with the Webull account, the $0.74 in dividends that I received from Albemarle (ALB) came as a result of my purchase of 2 shares of the company as detailed in my September 2019 Dividend Stock Purchases post. Dividends across my PM and MO positions within the Webull account remained the same.

Dividends within the Webull account managed to grow 12.3% sequentially from the $6.03 collected in October 2019 to $6.77 collected in January 2020.

I benefited from an additional $0.84 in dividends received from Altria Group (MO) as a result of the purchase of an additional share of MO back in November 2019.

Moving to the Robinhood account, dividends received in January 2020 from WP Carey (WPC), Realty Income (O), Leggett & Platt (LEG), Ventas Realty (VTR), Philip Morris International (PM), Albemarle (ALB), PPL Corp (PPL), and Genuine Parts Company (GPC) remained the same as they were in October 2019.

GlaxoSmithKline (GSK) also paid an additional $0.24 in dividends in January 2020 compared to October 2019, which was entirely as a result of a sequentially higher dividend from one quarter to the next.

PepsiCo (PEP) paid its final dividend of 2019 in September 2019, which explains why dividend income was $0.00 from the company in October 2019. This added $1.91 in dividend income from October 2019 to January 2020.

Eastman Chemical Company (EMN) announced a dividend increase in December, which boosted my dividend income by $0.12 from October 2019 to January 2020.

Rounding out dividend increases in the Robinhood account, Iron Mountain (IRM) also announced a dividend increase in October 2019, which increased my dividend income by $0.03 for January 2020.

Dividends received within the Robinhood account managed to increase 8.8% from the $35.63 received in October 2019 to the $38.77 received in January 2020.

Factoring out the $1.91 in PEP dividends that were as a result of timing, dividends received actually grew 3.5% sequentially from October 2019 to January 2020.

Factoring out the impact of PEP not paying dividends in October, but paying dividends in January, dividends across the M1 Finance account remained the same.Concluding my changes in dividend income from October 2019 to January 2020, the only change in the M1 Finance account was once again the payment of PEP's dividend in January 2020, whereas the dividend was last paid in September 2019. This increased my dividend income in the M1 Finance account by $0.02 compared to October 2019.

Concluding Thoughts:

Dividends across the board in my 3 taxable brokerage accounts managed to remain the same or grow when including the impact of PEP's dividend payments.

I'm satisfied with the quarterly dividend growth and the YOY dividend growth that represents nearly a doubling of total dividend income is a reflection of just how effective dividend investing can be even when contributing as little as I have on an absolute basis.

Given that I recently purchased my first car on my father's line of credit that I'll be repaying in the next month and that I need to save up for parts, I expect fresh capital contributions to be relatively limited over the next couple months.

I wasn't expecting to find a car this soon and that explains why I was forecasting that I would pass $1,000 in forward annual dividends in March. In light of my exciting news, I'm not expecting to reach this milestone until late May of this year.

Discussion:

How was your month in terms of dividends received? Did you receive dividends from any new companies during the month of January?

As always, thank you for reading and I would appreciate any comments that you are free to leave in the comment section below!

A Tribute To Kobe Bryant And The Lessons Learned From His Life

Image Source: Business Insider

Kobe Bryant. 18 time NBA All-Star. 5 time NBA Champion. 2 time NBA Finals MVP. 2 time Olympic gold medalist. Businessman. Author. Producer. Philanthropist. Father. Husband. Brother. Man of faith. And last, but not least, a role model that touched the lives of so many, even those of us that he never met, including yours truly.

For those that don't follow me on Twitter, I recently tweeted about the personal impact that Kobe had on my life beginning on the basketball court. Like countless other youth that have been inspired over the years by Kobe, I proudly wore the number 24 when I played basketball.

As I indicated in my January 2020 Dividend Stock Purchases post last week shortly following the passing of Kobe Bryant, his daughter, Gigi and 7 others, I wanted to take the opportunity this week to honor none other than the Black Mamba and highlight a few key life lessons that translate on and off the basketball court.

Before I get into the life lessons that Kobe indirectly taught me and so many others, I just wanted to take a moment to personally discuss the highlight of Kobe's career that amazed me the most.

As a bit of context, I have been a fan of NBA basketball in general since I was 6 years old (too bad because I missed out on the 2000-2001 Milwaukee Bucks that were the best Bucks team in my life until the past year and a half).

As such, I vividly remember the evening of January 22, 2006, when the Los Angeles Lakers played against the Toronto Raptors and were trailing by 14 points at the half, with Kobe carrying the offensive load, scoring 26 points in the first half.

Just when it seemed as though the hope of a Lakers victory was lost, Kobe erupted in the second half with 55 points, bringing his scoring total to 81 on the night. The Lakers would go on to stage a tremendous comeback and win the game 122-104 as a result of Kobe's incredible all around performance, where he finished with a +25 plus-minus.

While he fell 19 points short of tying Wilt Chamberlain's record of 100 points set in 1962, I would argue that Kobe's 81 is just as impressive as Wilt's 100 for the simple reason that Kobe needed only 42 minutes to score his 81, whereas Wilt needed 48 minutes. Kobe's 81 points also accounted for more of his team's total points (66.4%) than Wilt's 100 (59.2%).

Lesson #1: Never Sell Yourself Short

Among the many things that I find to be remarkable about Kobe's life, the one thing that really sticks out to me is when he discussed how he had a meeting with his guidance counselor when he was 10 years old.

Somehow, this guidance counselor had entirely dismissed the fact that Kobe was absolutely obsessed with basketball and that basketball was literally in Kobe's genetics, with his father being an NBA player for the Philadelphia 76ers, San Diego Clippers, and Houston Rockets.

This guidance counselor had asked Kobe what he wanted to be when he grew up, to which Kobe replied, he wanted to be an NBA player. The guidance counselor then replied, "You know, that's not very realistic."

Many of us have dreams that we eventually give up on after we are told that we'll never be able to accomplish them and that they're "not realistic," but Kobe did himself a favor and didn't sell himself and his potential short.

As if Kobe needed any more motivation to make his dream come true, this stuck with him and motivated him to put in the work necessary to make his dream a reality, which leads me into the next lesson that Kobe taught me and so many others.

Lesson #2: Don't Be Afraid Of Dreaming...Or Hard Work

I always find it admirable when somebody recalls knowing from such a young age what they wanted to accomplish, and then years later, they eventually accomplish it.

However, I think it can sometimes be easy to forget that dreams don't just happen.

Sure, Kobe had the physical characteristics and the upbringing of basketball and that played a role in his arrival to the NBA and eventual superstardom, but physical characteristics and a basketball background can only take a player so far.

Not much even needs to be said when there are countless examples of Kobe's work ethic in articles across the internet, but one of the most striking examples of Kobe's work ethic in action is evidenced by the fact that according to a Team USA trainer, Kobe held a gym workout from 4:15 am to 11:00 am, and refused to leave the gym until he made 800 shots.

When a guy is so committed, competitive, and willing to improve his game that he won't even leave the gym until he makes (not takes!) 800 shots, that is a prime example that Kobe's work ethic was second to none.

When you find your passion like Kobe did with basketball, the real lesson is to continue to put in the work. There will be days that you don't always feel like putting in the work, but you need to do it anyway if you want to be the best you possibly can be.

Lesson #3: Live Every Day Like It's Your Last

As much as Kobe accomplished in his 41 years on Earth, it's still a bit hard to believe that it can all end just like that.

It sometimes comes as difficult to believe for me being only 22 years of age and not really having to endure any deaths of immediate family members in my life to date (especially such sudden deaths like Kobe and those on board his helicopter), but if someone as legendary as Kobe can have their life cut short in an instant, it really can happen to anyone.

Kobe's recent passing was really an eye opener to me that in the end, no matter what our accolades, we're all human and we're all bound to leave this Earth at some point.

This just gives us all the more reason to find our passion and to pursue it with everything we have. Life is too short to be spending your disposable income and hours of your life on a bunch of consumer crap that doesn't really improve your quality of life and only makes you a captive to a job that you don't particularly enjoy or find real meaning and value in as a human being.

Concluding Thoughts:

If Kobe's life taught us anything, you're the only one that can truly know what you are capable of. You should never let anyone tell you what you are capable of for that very reason.

However, your dreams will never come true unless you're willing to put in a sustained, maximal effort. When you want to accomplish your goals as badly as you want to breathe, you put yourself in a position to succeed.

Perhaps it's my age and my lack of having to endure such sudden and untimely deaths in my family, but it still seems a bit unreal that someone can be perfectly fine one day and so gracious as Kobe was in congratulating Lebron in passing him in career points, and be gone the next.

Kobe's passing really serves as a lesson in my case or a reminder to others that life here on Earth can end in a split second, so we really need to live each day like it's our last, because one day, it will be our last.

Discussion:

What life lessons did you learn from Kobe? What was your favorite moment in Kobe's basketball career?

As always, thanks for reading and I look forward to any comments that you may leave in the comment section below.