Dividend Update - January 2016

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Includes: BNS, DIS, DPS, EOG, GE, HCP, JPM, KHC, MDLZ, MDT, NKE, O, OHI, PEP, PM, TD, WMT, WPC
by: Passive Income Pursuit

Summary

Keeping tabs on the dividends I receive each month to track my progress toward financial independence.

Dividend growth investing provides a positive portion of return each and every month.

January 2016's dividends saw a 4.8% increase from October 2015 and a 12.3% increase year-over-year. Organic annual dividend growth for January came to 5.7%.

It's the end of one month and the beginning of another, so it's time for my favorite update: my dividend update. These dividend updates reflect all dividends that I receive through my investing pursuits. I hope they can help inspire you to take control of your own finances and invest to build a passive income stream. What you use that stream for is up to you, whether it's to fund early retirement, just provide some fun money, or even to provide for an annual vacation; the key is that it can provide options and open up all sorts of possibilities.

Dividends for the month were solid but a bit of a letdown after December's giant haul. I received a total of $268.67 in dividends from my FI Portfolio during the month. I also received $9.83 in dividends from my Loyal3 portfolio bringing my taxable accounts dividend total to $278.50. My Roth IRA also provided $27.90 in dividends throughout the month. Across all 3 accounts, excluding the effect of taxes, January's dividends totaled $306.40.

FI Portfolio:

My FI Portfolio showed a somewhat lackluster 4.8% increase from the previous quarter, although considering no fresh capital was invested in companies that pay during the month, that's a solid quarter over quarter gain. I prefer year over year comparisons to the quarterly ones because companies tend to stick to the same payout schedule each year, but some companies have odd payout schedules that lead to inaccurate quarterly comparisons. My dividends received showed a 12.3% increase year over year. On a constant payout basis, i.e., the same companies that were owned during both time periods, dividends received showed a year over year increase of 5.7%.

The year over year increase was lower than I target for organic dividend growth of my holdings. However, nearly 6% organic dividend growth is still solid considering two of my holdings did not increase dividends in that time, EOG Resources (NYSE:EOG) and General Electric (NYSE:GE), and two holdings had sub-par dividend growth, Phillip Morris (NYSE:PM) and Wal-Mart Stores (NYSE:WMT). Overall I'm happy to be "disappointed" with almost 6% organic dividend growth.

Loyal3 Portfolio:

The Loyal3 portion of my portfolio showed an excellent quarter over quarter increase of 100.2%. Although that was thanks in large part to Disney's (NYSE:DIS) semi-annual dividend that falls in January and July. That same semi-annual dividend led to a decline in year over year comparisons because January 2015's dividend from Disney was an annual payment, they swapped to semi-annual during 2015. Year over year there was an 11.8% decline, but on a constant payout basis, excluding Disney, there was a strong 13.6% increase in dividends received. The improvement was due to capital being invested as well as dividend raises announced during 2015.

Roth IRA Portfolio:

My Roth IRA portfolio gives a purer view of dividend growth investing at work as I have not contributed capital to the portfolio since October 2012. Since my dividends are small, I opt to automatically reinvest dividends instead of pooling them with new capital. From dividend increases and dividend reinvestment, the January dividends showed a 21.9% increase compared to October 2015 and a solid 8.7% rise from the year ago period.

Dividend Raises During the Month:

A total of 3 of my holdings announced dividend raises during January which is dividend growth investing at work. You mean a company I own a piece of, albeit tiny, wants to pay out more of their profits to me just because I own part of it? Sign me up! There was a trifecta of increases from my REIT holdings with raises announced by Omega Healthcare Investors (NYSE:OHI), Realty Income (NYSE:O) and HCP Inc. (NYSE:HCP). Combined the dividend increases added $14.38 to my forward dividends.

Looking Forward:

The forward 12-month dividends for my FI Portfolio are at $5,506.95. Forward dividends in my Loyal3 portfolio ended the month at $60.99, bringing the total taxable account forward dividends to $5,567.95. My Roth IRA's forward 12-month dividends are up to $272.64 due to dividend reinvestment.

Monthly Average:

Below is the chart showing the monthly dividend totals for each year that I've been investing as well as the monthly average. It's not always an increase as some companies have odd payout schedules and eventually some positions will get dropped, but the long-term trend is what matters. The rolling 3-month average of my FI Portfolio is at $509.41. That's about a $17 increase from where my year to date average was at the end of 2015. With more contributions/investments and expected dividend increases, the gap should continue to widen.

Click to enlarge

Dividends Received Breakdown:

FI Portfolio Dividends - January 2016

Company Dividends Rec'd
EOG Resources

$1.36

Medtronic (NYSE:MDT) $35.01
Phillip Morris $63.86
Wal-Mart Stores $31.07
Realty Income $17.51
General Electric $39.38
PepsiCo (NYSE:PEP) $43.24
The Bank of Nova Scotia (NYSE:BNS) $10.58
W.P. Carey (NYSE:WPC) $19.59
Toronto Dominion Bank (NYSE:TD) $7.07
January 2016 Total $268.67
2016 YTD Total $268.67
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Loyal3 Portfolio Dividends - January 2016

Company Dividends Rec'd
Walt Disney Company $3.49
Mondelez International (NASDAQ:MDLZ) $1.45
Dr Pepper Snapple Group (NYSE:DPS) $1.28
Kraft-Heinz (NASDAQ:KHC) $2.07
PepsiCo $1.26
Nike (NYSE:NKE) $0.28
January 2016 Total $9.83
2016 YTD Total $9.83
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Roth IRA Portfolio Dividends - January 2016

Company Dividends Rec'd DRIP Shares
JPMorgan Chase (NYSE:JPM) $9.82 0.171
Phillip Morris $13.30 0.152
Wal-Mart Stores $4.78 0.078
January 2016 Total $27.90
2016 YTD Total $27.90
Click to enlarge

A full list of my holdings can be found here.

Disclosure: I am/we are long EOG, GE, PM, WMT, DIS, OHI, O, HCP, MDT, PEP, BNS, WPC, TD, MDLZ, DPS, KHC, NKE, JPM.

I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

Additional disclosure: Investing involves risks. Any mention of a company in this article is not a recommendation to buy or sell. Please consult a financial professional prior to investing and do your own due diligence.