Saturday, July 13, 2019

June 2019 Portfolio Summary

The S&P500 has been increasing. Right now, this is a high quality problem. On one hand, since my portfolio is around $730,000 the capital gains is large. However, it makes it very hard for me to add additional shares to my portfolio to raise my dividend income. I am not a fan of overpaying and as a result my cash position has slowly been growing. Right now I have around $20,000 in cash and am trying to find a way to deploy it.


On Friday 7/12, the S&P500 passed the $3000 barrier. This is quite an accomplishment for the American economy. Since the overall market is moving higher, my portfolio moved upward in a similar manner. 

Right now my portfolio sits at $735,000. Since my portfolio is moving closer to the $1 million figure, even a 1% move in the overall market is a noticeable bump now (1% of $735,000 is $7,350). Since the portfolio continues to climb upward, the overall dividend yield of my portfolio is now at 2.59%, this is far from the 3.00% goal I was aiming for in the beginning of my investing life. However, since all equities are over valued, it is hard to get a good yield and I have reduced my yield expectations to around 2.6-2.7% range. Many companies that I used to purchase at 3 to 3.5% yield are now yielding 2.5 to 3.0%, as a result each dollar put in to work is producing less income than in say 2016 or 2017.

I think if this trend continues, breaking $800,000 is feasible. However, I do welcome a pull back to add more shares for a huge boost in my dividend income graph. Below are some illustrations showing my progress, I think it's good to visualize or tabulate one's progress and goals so they are clearly understood. This way an investor can see if his or her plan is working or not.


The portfolio's dividend has been rising consistently from all the dividend increases each of my positions is churning out this year. I am expecting an average 2.7% yield in the portfolio plus a 10% average dividend hike. This should produce around 13% income growth with dividends reinvested for existing portfolio positions. The dividend growth chart below is rather step-like recently as I have a tendency now to hold a lot of cash and then deploy it all at once. Before when my portfolio was smaller, I just continuously put in cash like clockwork as my focus was to increase the income output. But now, it is really hard to find good deals so I have a lot of cash most of the time.


Below is a itemized listing of what is inside my portfolio. Visa and Mastercard, both have been growing so much since I started investing in them several years ago. I have added to these positions every year. Right now Visa is the first position to cross $40,000 USD. JNJ has always a large position and sometimes move down during news headlines about baby powder lawsuits, I use those opportunities to add more in this diversified healthcare giant. My two tobacco positions total around $62K total, each of them has been relatively flat around $30K for several years. I don't expect these to move much and just expect them to pay the staedy 5-6% dividend yield every year (similar to AT&T).

I think Home Depot and NextEra Energy will eventually climb to the high $30,000 values and surpass PM and MO, those two companies have been growing very consistently and their steady reasonably high dividend increases year demonstrate their executive vision and good execution. Nearly all my portfolio positions are in the 5-figure range now, just 6 positions left under $10,000. A lot of these positions grew past $10,000 by themselves, after holding for many years. When the portfolio first began, $10,000 wasn't on the radar so the portfolio has progressed very nicely over the last 6 years.

Name Ticker Sector       Value   Weight        Divies      Yield S&P Fin VL Fin VL Safety
Visa Inc V Financial $42,990.49 5.85% $238.40 0.5545% A+ A++ 1
Johnson & Johnson JNJ Health $35,615.92 4.84% $1,007.75 2.8295% AAA A++ 1
Philip Morris International Inc PM Staples $31,768.85 4.32% $1,769.03 5.5684% A B++ 2
Altria Group Inc MO Staples $31,399.08 4.27% $2,029.84 6.4646% BBB B++ 2
Home Depot Inc HD Discret $31,346.95 4.26% $781.41 2.4928% A A++ 1
NextEra Energy Inc NEE Utilities $29,847.58 4.06% $714.98 2.3954% A- A+ 2
PepsiCo PEP Staples $29,409.91 4.00% $842.93 2.8661% A A++ 1
Mastercard Inc MA Financial $26,396.96 3.59% $124.65 0.4722% A A++ 1
Becton Dickinson and Co BDX Health $25,536.28 3.47% $311.02 1.2180% BBB A++ 1
Air Products & Chemicals, Inc APD Materials $23,109.74 3.14% $472.04 2.0426% A A+ 1
Realty Income Corp O REIT $22,340.82 3.04% $860.40 3.8513% A- A 2
Clorox Co CLX Staples $22,247.80 3.03% $596.80 2.6825% A- B++ 2
Ross Stores Inc ROST Discret $21,658.88 2.95% $208.38 0.9621% A- A 2
McCormick & Company MKC Staples $20,224.15 2.75% $290.90 1.4384% BBB A+ 1
Xcel Energy Inc XEL Utilities $20,194.56 2.75% $538.08 2.6645% A- A+ 1
Procter & Gamble Co PG Staples $19,306.06 2.63% $500.99 2.5950% AA- A++ 1
WEC Energy Group, Inc. WEC Utilities $18,909.61 2.57% $522.13 2.7612% A- A+ 1
Kimberly-Clark KMB Staples $18,454.41 2.51% $547.94 2.9692% A A++ 1
Automatic Data Proc, Inc ADP Tech $17,144.14 2.33% $328.08 1.9136% AA A++ 1
Illinois Tool Works Inc. ITW Industrial $16,780.67 2.28% $443.11 2.6406% A+ A++ 1
3M Co MMM Industrial $16,434.87 2.24% $546.12 3.3229% AA- A++ 1
AT&T Inc T Telecom $16,325.80 2.22% $989.74 6.0624% BBB A++ 1
The Coca-Cola Co KO Staples $15,498.85 2.11% $475.79 3.0698% AA- A++ 1
Church & Dwight CHD Staples $14,652.38 1.99% $177.49 1.2113% BBB+ A+ 1
Starbucks Corporation SBUX Discret $14,300.51 1.94% $229.39 1.6041% A A++ 1
Stryker Corporation SYK Health $13,957.00 1.90% $140.65 1.0078% A A++ 1
Colgate-Palmolive Co CL Staples $13,937.73 1.90% $322.30 2.3124% AA- A+ 1
Microsoft Corporation MSFT Tech $13,602.07 1.85% $180.19 1.3247% AAA A++ 1
Dominion Energy, Inc. D Utilities $11,675.39 1.59% $553.19 4.7381% BBB+ B++ 2
TJX Companies Inc TJX Discret $11,576.52 1.57% $187.87 1.6229% A+ A++ 1
McDonald's Corporation MCD Discret $10,206.67 1.39% $222.35 2.1785% BBB+ A++ 1
Abbott Laboratories ABT Health $9,691.36 1.32% $147.82 1.5253% BBB A++ 1
General Mills, Inc. GIS Staples $9,073.03 1.23% $332.77 3.6677% BBB A 1
General Dynamics Corporation GD Industrial $8,514.37 1.16% $186.93 2.1954% A+ A++ 1
Honeywell International Inc. HON Industrial $8,479.96 1.15% $157.02 1.8516% A A++ 1
Boeing Co BA Industrial $8,083.88 1.10% $181.89 2.2500% A A++ 1
Medtronic plc MDT Health $7,377.43 1.00% $160.56 2.1763% A A++ 1
Misc Type ……….. Partial Totals Weight Yr Dividends  Avg Yield …..832 …..9 …..82
Equity Stocks $708,070.66 96.30% $18,320.94 2.5874%
Investable US Dollars $21,259.55 2.89%
Miscellaneous Assets $5,952.50 0.81%
. .. Equity + Misc Weight …..2 ….. …..222 …22 …..223
Total $735,282.71 100.00%

Below is a visual depicting the sectors and position sizes. The portfolio is highly diversified, so any dividend cuts in a particular position or even sector will not size-ably affect my dividend performance. I do want to add more to Technology and Industrials and Discretionary to include more growth. I am trying to diversify away from the large position in consumer staples. Consumer staples used to take up an even larger part of my portfolio, but over the years it has reduced to 31%, and newer sectors such as Healthcare and Utilities have grown. Ironically, Utility stocks have been one of the best performing sectors in the portfolio. My picks in NEE, and XEL, and WEC utilities (which often are associated with boring types of businesses) over the years have been growing earnings, dividends, and share prices in a near straight line.



Stay tuned for next month's report

-YD

1 comment:

  1. I was waiting to see if you will deploy more cash. But I see that you will wait a little. On my end right now I don't have any money left so I won't have that problem for about 4 weeks. Pullback will occur soon. Then we will pile up again.

    Karl

    ReplyDelete