June 2021 Dividend Stock Purchases

As I'm writing this blog post, July is just 4 days away, and 2021 is on the brink of already being half over! 

I'm making significant progress in achieving my financial goals for the year, and may need to even raise my financial goals in the near future! With the exception of ending this year with 8,000+ followers on Seeking Alpha, I am also on track to achieve my personal goals for the year.

With that aside, I will delve into the intent of this post, which is to discuss my dividend stock purchases for June 2021.

Beginning with my retirement account, I deployed $319.48 in gross capital between my 7% contribution, my employer's 3% contribution, and the reinvestment of my dividends received from my Capital Income Builder (CAIBX) position during June 2021.

Factoring in the 3.5% sales charge on both my contributions and my employer's contributions, I put $310.65 to work, which helped build my CAIBX position by 4.49 shares from 166.944 shares entering June 2021 to 171.434 shares heading into July.
 

Using $2.13 in net annual forward dividends/share, my net annual forward dividends were boosted by $9.56, which equates to a 3.08% net yield on the capital that I deployed during the month.

Shifting to my taxable account purchases, I began the month with adding a single share of UnitedHealth Group (UNH) to my portfolio at a cost of $402.99, following the 16.0% dividend increase. While I missed out on adding UNH in the low-$300s earlier this year, my addition came at a 2021 P/E ratio of less than 22 based on Yahoo Finance's average analyst estimate of $18.57 in EPS for this year, which is still reasonable in my opinion.

Factoring in UNH's new annualized dividend/share of $5.80, my net yield works out to 1.44% or a bit higher than the S&P 500's current yield.

I also decided to add to my British American Tobacco (BTI) position on the same day, purchasing 2 shares at an average cost of $40.22 a share.

Based on MarketWatch's average analyst estimate of $4.58 in EPS for 2021, I added to my position in BTI at a cost of less than 9 times this year's EPS and just 8 times next year's EPS! 

Using BTI's net annual forward dividend/share figure of $2.97, I added $5.94 in net annual forward dividends to my portfolio, which equates to a 7.38% net yield.

The first position that I added to that was on my June 2021 Watch List, was American Electric Power (AEP), which was 2 shares at an average cost of $85.00 a share.

Based on the Yahoo Finance analyst average estimate of $4.67 in EPS for 2021, I paid roughly 18 times this year's EPS for AEP, which is within reason in my opinion, especially given the premium of the broader market.

Based on the $5.92 in net annual forward dividends that were added as a result of my purchase, my net yield works out to 3.48%.

Another stock that was also on my June 2021 Watch List, was Philip Morris International (PM), which I added another share of at a cost of $98.01.

While paying 16 times this year's Yahoo Finance average analyst estimate is a significant premium to what I paid for shares of BTI, I view PM as the ESG king of its industry, which I believe justifies its premium.

The $4.80 in net annual forward dividends that I added due to my purchase equates to a 4.90% net yield.

A notable absence from my stock purchases in June 2021, is STORE Capital (STOR), which shot up over 6% since I highlighted the stock as being on my watch list. Since STOR was already trading around fair value in my opinion, this price activity was just a bit too much for me to justify adding to my position. There's always potentially next month, right?

I also added 4 shares of Verizon (VZ) to my position at an average cost of $57.42 a share, which is about 11 times this year's Yahoo Finance average analyst estimate of $5.09 in EPS.

When factoring in the $10.04 in net annual forward dividends that were added to my portfolio as a result of my purchase, my net yield works out to 4.37%.

Closing out my purchasing activity for the month of June, I opted to initiate a whole share position in JPMorgan Chase (JPM) of 3 shares at an average cost of $153.69 a share.

Based on the Yahoo Finance average analyst estimate of $13.16 in EPS for 2021, I paid less than 12 times this year's EPS, which is pretty reasonable for a company of JPM's quality.

Using the $10.80 in net annual forward dividends that were added to my portfolio due to my purchase (and I believe this amount is set to increase around 30% in the near future given that major banks passed the recent stress test with flying colors, JPM included), my net yield equates to 2.34%.

Concluding Thoughts:

Factoring in the $1,752.84 in net capital that I deployed in June 2021 and the $52.86 in net annual forward dividends that were added to the portfolio due to my purchases, my average weighted net yield was 3.02% in June.

Since July will be a two paycheck month in which I am compensated for a bit of unused vacation time and I have recently started writing for The Motley Fool, I am expecting that I will be able to deploy around $3,000 in July, which will be a huge boon to my net annual forward dividends during the month.

Between the $3.334 in dividend increases that I received in June and the net annual forward dividends that were added from capital deployment, my net annual forward dividends surged from just over $1,720 to begin the month to nearly $1,780 heading into July.

Discussion:

How was your June in terms of capital deployment?

Did you add any positions to your portfolio as I did with JPM?

I appreciate your readership and welcome your comments in the comment section below!

Expected Dividend Increases for July 2021

As I'm writing this blog post, the first official day of summer is just two days away. 

In an interesting twist, the first day of summer is set to be well below normal here in Central Wisconsin at a high of just 74 degrees Fahrenheit and a low of 55 Fahrenheit.

Moving to the intent of this post, I will be reviewing the dividend increases that I received during June 2021, and looking ahead to the dividend increases that I am expecting in July 2021.

Actual June 2021 Dividend Increases

Dividend Increase #1: Realty Income (O)

As has been the case in the 3 1/2 years that I have owned the stock, Realty Income didn't fail to meet my expectations. O announced a 0.2% increase in its monthly dividend, from the previous dividend of $0.2350/share to the new dividend of $0.2355/share.

Across my 13 shares of the stock, my net annual forward dividends increased $0.078 as a result of O's dividend announcement.

Dividend Increase #2: W.P. Carey (WPC)

W.P. Carey also announced a 0.2% increase in its quarterly dividend, from the previous dividend of $1.048/share to the new dividend of $1.050/share.

Due to WPC's dividend increase, my net annual forward dividends were boosted by $0.056 across my 7 shares of the stock.

Dividend Increase #3: UnitedHealth Group (UNH)

Rounding out my discussion of dividend increases that I received during June 2021, UnitedHealth Group exceeded my expectation of a 14.4% increase to its quarterly dividend, from $1.25/share to $1.43/share.

UNH instead announced a 16.0% increase in its quarterly dividend, taking it to $1.45/share.

As I discussed in a recent Motley Fool article, I believe that UNH's dividend remains as safe now as it was leading up to the dividend hike, which actually prompted me to recently add to my position.

Across my single share of the stock at the time of the dividend increase, my net annual forward dividends advanced $0.80.

Surprise Dividend Increase: Simon Property Group

While Simon Property Group was due to begin increasing its dividend at some point as COVID restrictions ease and the economy recovers, especially after the 38.1% dividend cut last June as a measure of caution to preserve liquidity, it certainly came as a surprise to me when SPG increased its quarterly dividend 7.7% from $1.30/share to $1.40/share.

As a result of SPG's dividend increase, my net annual forward dividends were boosted by $2.40 across my 6 shares of the stock.

Expected Dividend Increases for July 2021

Expected Dividend Increase #1: Wells Fargo (WFC)

In what I anticipate will be the first increase in Wells Fargo's quarterly dividend since its cut last year, I believe that Wells Fargo's quarterly dividend will be increased to $0.25/share based on Yahoo Finance's average analyst estimate of $3.81 for this fiscal year and a return to a more generous payout ratio.

If this dividend increase plays out, this would work out to a $4.80 increase in my net annual forward dividends across my 8 shares of the stock.

Expected Dividend Increase #2: J.M. Smucker (SJM)

I'm expecting a 3.3% increase in J.M. Smucker's quarterly dividend from $0.90/share to $0.93/share, which would be a notable slowdown from the company's 3 year DGR of 4.9%.

Since SJM is positioned to continue to face growth difficulties going forward, I believe this is a realistic expectation for shares of SJM.

Across my 2 shares of SJM, my net dividends would increase $0.24 if SJM's dividend increase plays out as expected.

Expected Dividend Increase #3: National Retail Properties (NNN)

The final dividend increase that I am expecting for July is from none other than National Retail Properties.

Since NNN is anticipating a recovery in its AFFO/share from $2.80 in 2019 to a midpoint AFFO/share figure of $2.94 in 2021, I believe that NNN will raise its quarterly dividend 3.8% from $0.52/share to $0.54/share. 

My net dividends would advance by $0.88 across my 11 shares of the stock, if the dividend is increased as much as I expect.

Concluding Thoughts:

Overall, O and WPC delivered just as I thought they would in June. I was very pleased to find that UNH's dividend increase slightly exceeded my expectations, and SPG's dividend increase took me by surprise.

These 4 dividend increases helped my net annual forward dividends to advance by $3.334 in June, which would take a fresh capital investment of $83.35 at a 4% yield to replicate.

While I am expecting less dividend increases in July compared to June, I am forecasting a $5.92 increase in my net annual forward dividends primarily due to WFC's anticipated dividend hike.

Discussion:

How was your June in terms of dividend increases?

Are you anticipating any first time dividend increases as I am with NNN?

As always, I appreciate your readership and welcome your comments in the comment section below!

May 2021 Dividend Stock Purchases

As I'm writing this blog post, the official start of summer is just over one week away, but that hasn't stopped the temperatures from reaching into highs within the upper 80s to low 90s Fahrenheit in Central Wisconsin over the past few days!

Aside from that update, I will be discussing my capital deployment during the month of May 2021.

Starting off with my retirement account, I deployed $252.00 in capital when factoring in both my 7% contribution and my employer's 3% contribution.

When adjusting for the 3.5% sales charge on both my contributions and my employer's, I put $243.18 to work in May 2021.

The capital contributions made during May 2021 helped my Capital Income Builder (CAIBX) position grow by 3.535 shares from 163.409 shares at the beginning of May to 166.944 shares heading into June.

Using $2.13 in net annual forward dividends/share, my net annual forward dividends advanced $7.53, which works out to a 3.10% net yield.

Moving to my taxable accounts, I started 2 new positions and added to a number of positions during May, including all 3 of the stocks on my May 2021 Dividend Stock Watch List, as well as 1 of the stocks on my April 2021 Dividend Stock Watch List.

I initiated a 6 share position of Abbott Laboratories (ABT) in May 2021 at an average cost of $117.13/share, which was due to the reasons outlined in my May 2021 Dividend Stock Watch List (i.e. a solid balance sheet, favorable earnings outlook, and reasonable valuation).

The $10.80 in net annual forward dividends that I added as a result of this purchase equates to a 1.54% net yield.

Next, I initiated a 3 share position in Microsoft (MSFT) at an average cost of $247.84/share due to Microsoft's flawless credit rating matched only by Johnson & Johnson (JNJ), Microsoft's numerous growth avenues, and reasonable current valuation for long-term investors such as myself.

MSFT's $6.72 in net annual forward dividends that were added due to the purchase work out to a 0.90% net yield.

The final dividend stock on my watch list for May 2021 that I added to was 1 share of L3Harris Technologies (LHX) at a cost of $216.48 due to the company's recent 20% dividend increase, strong outlook for 2021, and attractive mid-teens non-GAAP P/E ratio for the current year.

The $4.08 in net annual dividends added as a result of the purchase equate to a 1.88% net yield.

I also added 2 shares to my position in American Tower (AMT) at a cost of $247.78/share due to the company's reasonable payout ratios, favorable long-term outlook, and commitment to returning value to shareholders primarily via dividends that grow on a quarterly basis.

AMT's $9.92 in net annual dividends (at the time of the dividend stock purchase as AMT raised its quarterly dividend 2.4% from $1.24/share to $1.27/share shortly after my purchase) work out to a 1.99% net yield.

I added 1 share to my position in CVS Health (CVS) at a cost of $84.50, which equated to a 2.37% net yield when factoring in the $2.00 in net annual forward dividends that were added due to the purchase.

I also added 4 shares to my position in Realty Income (O) at an average cost of $65.10/share, which worked out to a 4.33% net yield when considering the $11.28 in net annual forward dividends that were added as a result of the purchase.

I added 1 share to my position in Viatris (VTRS) at a cost of $16.00, which equated to a 2.75% net yield when factoring in the $0.44 in net annual forward dividends that were added due to the purchase.

I also added 1 share to my position in STORE Capital (STOR) at a cost of $33.59, which was due to my reasons outlined in my June 2021 Dividend Stock Watch List. 

The $1.44 in net annual forward dividends that were added as a result of my purchase work out to a 4.29% net yield.

Since I was impressed by Lowe's (LOW) recent 33.3% increase to its quarterly dividend from $0.60/share to $0.80/share, I added 1 share to my position the day after the dividend increase at a cost of $195.98.

LOW's $3.20 in net annual forward dividends that were added due to my purchase equate to a 1.63% net yield.

I also added 1 share to my Philip Morris International (PM) position at a cost of $97.08 due to reasons discussed in my June 2021 Dividend Stock Watch List.

The $4.80 in net annual forward dividends that were added as a result of my purchase work out to a 4.94% net yield.

Finally, I added 1 share to my General Dynamics (GD) position at a cost of $191.00, which equated to a 2.49% net yield when factoring in the $4.76 in net annual forward dividends that were added due to my purchase.

Concluding Thoughts:

When factoring in the $3,280.08 in net capital that I deployed during May 2021 and the $66.97 in net annual forward dividends that were added as a result of my capital deployment, I deployed capital at an average weighted net yield of 2.04%.

Since June is positioned to be a 2 paycheck month without any additional stimulus anticipated, I am forecasting that June 2021 will be a month in terms of capital deployment within my typical $1,500-$2,000 range.

The $4.20 in dividend increases received during May in combination with the $66.97 in net annual forward dividends added due to my purchase activity, work out to a $71.17 boost in my net annual forward dividends from just over $1,650 at the beginning of May to just over $1,720 heading into June.

Discussion:

How was your May in terms of capital deployment?

Did you add any positions to your portfolio during May as I did with ABT and MSFT?

As always, thank you for reading and I look forward to your comments in the comment section below!

May 2021 Dividend Income

Things are really heating up here in Central Wisconsin! This past Friday (June 4), we reached a high temp in the 90s Fahrenheit. The heat also appears poised to continue into the weekend and the next week when this blog post is set to be published.

With that aside, I will be detailing my dividend income during May 2021, which was (spoiler alert incoming) yet another record month for me for the middle month of a quarter.

Analysis:

During the month of May 2021, I collected $116.98 in net dividends compared to the $98.44 in net dividends received during February 2021, which equates to an 18.8% quarterly growth rate.

What's more striking, however, is that the $116.98 in net dividends collected during May 2021 represent a 35.0% YoY growth rate against the $86.62 in net dividends received in May 2020.

Going into detail by account, I received $104.76 in net dividends from 18 companies in my Robinhood portfolio, $11.89 in net dividends from 3 companies in my Webull portfolio, and $0.33 from 15 companies in my M1 Finance account.

My net dividends received from February 2021 to May 2021 increased by $18.54 due to the following activity within my portfolio:

I received an extra $0.54 in net dividends from Williams Sonoma (WSM) within my Robinhood account as a result of WSM's recent dividend increase.

My net dividends collected from British American Tobacco (BTI) were $3.53 higher in my Robinhood and Webull accounts due to BTI's dividend increase and my recent purchases of additional shares of the stock in December 2020 and February 2021.

I received an additional $0.01 from Realty Income (O) within my Robinhood account as a result of O's recent dividend increase.

My net dividends collected from AbbVie (ABBV) in my Robinhood account advanced $1.30 due to my recent purchase of another share of the stock.

I received a $0.27 boost in my net dividends received from General Dynamics (GD) within my Robinhood account as a result of the stock's recent dividend increase.

My net dividends collected from Verizon (VZ) in my Robinhood account surged $8.79 due to my initiation of a whole share position.

I received $4.00 less in net dividends from The GEO Group (GEO) within my Robinhood and Webull accounts as a result of the stock's recent dividend suspension, which I now realize I forgot to include in the Actual Dividend Announcements for April 2021 section of my Expected Dividend Increases for May 2021 post.

My net dividends benefited from an $8.07 reduction in my Robinhood Gold ($5.00)/margin expenses ($3.07) due to my discontinuation of my Robinhood Gold subscription. 

Finally, I collected $0.03 in additional net dividends within my M1 Finance account due to the timing of Fastenal's (FAST) and Norfolk Southern's (NSC) dividend payments.

Concluding Thoughts:

As a result of dividend increases and steady capital deployment, my net dividends advanced 18.8% on a quarterly basis and an astonishing 35.0% over last May's total.

This was the first of what I anticipate will be many middle of the quarter months in the triple digits, which is encouraging considering all of the distribution cuts (i.e. ET and EQM, which later became ETRN) and dividend cuts/suspensions (i.e. SKT and GEO) that the portfolio has endured over the past year.

As painful as these cuts and GEO's suspension have been, I'm grateful that they occurred now when I'm not dependent on the income rather than years down the line when I am on more of a fixed income. 

It was a lesson that I foolishly ignored in my earlier days of investing, but the lesson to not chase yield is one I am beginning to take to heart, especially with my capital deployment in higher growth dividend stocks in recent months. The common denominator in most, if not all of the dividend cuts and suspensions I have went through over the years was eye-popping (unsustainable) yield, especially in the high-single digits to low-double digits.

Having finally learned this lesson, I look forward to seeing how long the portfolio can go before its next dividend cut (not counting T's upcoming dividend cut next year).

Discussion:

How was your May in terms of dividend income?

Did you receive any first time dividends during the month as I did from the whole shares of VZ in my Robinhood account?

I appreciate your readership and welcome your comments in the comment section below!

Expected Dividend Increases for June 2021

As I'm writing this blog post, Memorial Day is a couple days away and June is fast approaching. It's hard to believe that half of 2021 is just weeks away from being in the books!

With that aside, I will be discussing the dividend increases that I received in May and looking ahead to the dividend increases that I am expecting in June.

Actual May Dividend Increases

Dividend Increase #1: American Tower (AMT)

American Tower announced a 2.4% increase in its quarterly dividend, taking it from $1.24/share to $1.27/share, which was slightly above my expectation of a 1.6% increase in the quarterly dividend as outlined in my previous post of this series.

For those that aren't familiar with AMT, the stock has increased its dividend each quarter without fail since its REIT conversion in 2012.

Overall, I'm very pleased with the first dividend increase that I received from AMT since I initiated my position in the stock back in April.

Across my 3 shares of the stock, my net annual forward dividends increased $0.36 as a result of AMT's dividend increase.

Dividend Increase #2: Lowe's (LOW)

Given Lowe's impressive operating results to start off the year (25.9% consolidated comparable sales growth and 81.4% YoY diluted EPS growth), LOW's management team and Board of Directors felt comfortable hiking its quarterly dividend by a staggering 33.3% from $0.60/share to $0.80/share.

Since this raise was just over triple what I was anticipating and LOW can easily afford the dividend increase, I'm glad to see LOW rewarding shareholders with a very generous dividend increase.

My net annual forward dividends surged $3.20 across my 4 shares of LOW's at the time of the stock's dividend increase.

Dividend Increase #3: Leggett & Platt (LEG)

Shortly after I wrote my previous post of this series, Leggett & Platt announced a 5.0% increase in its quarterly dividend, taking the quarterly dividend from $0.40/share to $0.42/share just as I expected.

Across my 8 shares of the stock, my net annual forward dividends advanced $0.64 due to LEG's dividend increase.

Expected Dividend Increases for June

Expected Dividend Increase #1: Realty Income (O)

Starting off June's expected dividend increases, is none other than The Monthly Dividend Company itself, Realty Income. 

Since O has a track record of quarterly dividend increases at the end of each quarter and typically a larger raise at the beginning of the year, I am anticipating that O will announce a 0.2% increase to its monthly dividend, taking it from the previous $0.235/share to $0.2355/share.

Should this dividend increase manifest itself as I expect, my net annual forward dividends would increase $0.078 across my 13 shares of the stock.

Expected Dividend Increase #2: W.P. Carey (WPC)

Another sturdy dividend payer with a track record of delivering dividend increases each quarter is W.P. Carey.

Similar to O, I am anticipating a 0.2% increase in WPC's quarterly dividend, from the old quarterly dividend of $1.048/share to $1.050/share.

Across my 7 shares of the stock, my net annual forward dividends would be boosted by $0.056 should this dividend increase play out.

Expected Dividend Increase #3: UnitedHealth Group (UNH)

The final dividend increase that I am expecting is from none other than the healthcare behemoth, UnitedHealth Group.

Since UNH is poised to continue with strong double-digit earnings growth in 2021, I am predicting that UNH will announce a solid 14.4% increase in its quarterly dividend, from $1.25/share to $1.43/share.

My net annual forward dividends would advance by $0.56 across my single share of UNH in the event that this dividend increase occurs.

Concluding Thoughts:

Overall, May was a very strong month in terms of dividend increases despite the fact that there were only 3 this month. 

I received $4.20 in dividend increases during May, which would be equivalent to adding $105.00 in fresh capital at a 4% yield.

While I am expecting another 3 raises in June, I don't believe June's impact of dividend increases will come anywhere near May's due to my limited allocation to the one true growth stock that will be announcing a dividend increase in June, which is UNH.

Even so, my net annual forward dividends are just over $1,720 heading into June, which is really beyond what I could have imagined by this point in my life. I still have a long way to go on the road to attaining financial freedom, but the progress to date since I began investing nearly 4 years ago has been very encouraging.

Discussion:

Were May's dividend announcements better than your expectations as was the case with myself?

Did you receive any first time dividend increases as I did with AMT?

Thanks for your readership and I look forward to your comments in the comment section below!