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.
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!
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