My Dividend/High Yield Investing Journey End Of July Update

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Includes: OGE, PM, TIS, VTR, VZ
by: Steve Felix

Summary

Shortening the distance to my goal of 10% yield on cost for my portfolio.

The market of stocks generally has something reasonably priced.

Keeping a list of stocks I would like to own, and requiring them to be bought only when below both their 50 and 200 day averages, my own constraint.

It seems that once I have a goal on paper, I have a hard time not having a pencil and calculator in hand. Last month I wrote: Establishment of "the number" of monthly income needed to be added to reach my goal of 10 X 8. In July, some stocks I wanted to own came into my buy range, and with calculator in hand, I have reset my goal to 10 X 7. It is no wonder my wife and daughters lovingly, but mockingly, refer to me as Mr. Patience.

July brought three more sales from my high yield "expendables" side of the portfolio. On 7/6 I sold 150 NRF PRE @ 25.33, 7/8 I sold 100 NM PRH @ 18.1301, and on 7/14 I sold 100 LTS PRA @ 24.372.

Probably time to rename my portfolio as the only position I plan to sell from here is my position in LTS-A. The rest will be allowed to play out as a reminder of how smart I am not. The amounts are not enough to move the needle much as to my plan.

Company Name Symbol # of shares held Annual Dividend per share Total dividend
Breitburn Energy Partners L.P. BBEP 400 .50 200
Kinder Morgan Warrants KMI-WS 800 0 0
Ladenburg Thalmann Financial Pref A LTS-A 200 2.00 400
SeaDrill Limited SDRL 175 0 0
South32 Ltd SOUHY 24 0 0
  Total     600

Knowing I can not time the market, and believing in a market of stocks that move individually, or sometimes sector wide, I keep my list in a portfolio, with 50 and 200 day averages visible, so that I can see what is taking a dip. If you think this would keep you out of good stocks, notice that currently, T, VZ, SJI, CAT, STR, XOM, NJR, IBM, CMI, JNJ, TGT, NSC, FAST, NSC, UNP, DEO, and AAPL, among others, fit at least at times this week.

Buys in July with 200 and 50 day averages on buy date respectively, in parenthesis:

7/8 35 Phillip Morris (NYSE:PM) @ 81.68 ( 81.78 / 82.30 ) I doubt anyone needs my thought process on this one. A search brings multiple articles.

7/10 56 Ventas (NYSE:VTR) @ 63.99 ( 71.52 / 64.56 ) Rounded up to 200 shares. Spin off of Care Capital Properties will be direct competition with OHI, and 10% over all raise coming within the month according to their last call.

07/14 120 OGE Energy Corp (NYSE:OGE) @ 28.7 and 7/21 100 OGE @ 28.05 ( 32.22 / 29.57 )

8 years of raises. 5 Year Average Dividend Yield: 2.80%. Current yield 3.5%. Raises going the right way: DGR 1yr. 10.8 / 3 yr. 7.2% / 5 yr. 5.4%.

From their May 10th call: "From an OGE Energy perspective, the Enable distributions contribute significantly to our cash flow to support financing the environmental capital program and to accomplish our goal of growing the dividend 10% per year through 2019."

07/21 100 Verizon (NYSE:VZ) @ 46.88 (48.48 / 47.48 ) Another higher yield that should not need an introduction. Good article here. 07/22 100 VZ @ 46.47 07/22 50 VZ @ 46.19

07/24 100 Orchids Paper Products Company (NYSEMKT:TIS) @ 22.91 ( 25.27 / 24 ) Not a stock some would like. Going from a quarterly dividend of .10 in March 2011, to .35 in June 2013, the dividend has now been frozen for ten quarters. I see them as shareholder friendly. They have stood behind the dividend even when they were not earning it, while now moving to expand eastward and become more of a national player. Good article with more than I can cover in this article here.

July raises: $56.12

KMI .04 annual +$40. OHI .04 annual +$3.52 BGS .04 annual $6.80 Span .04 annual $5.80

Portfolio:

Symbol Company Name # of shares held Annual Dividend Per Share Total Dividend
AMLP Alerian MLP ETF 200 1.18 236
AMNF Armanino Foods of Distinction 1,000 0.072 72
BBL BHP Billiton PLC 60 2.48 148
BGS B&G Foods Inc. 170 1.40 238
CLMT Calumet Specialty Products Partners LP 574 2.74 1572
CVX Chevron Corporation 192 4.28 822
GIS General Mills, Inc. 43 1.64 71
HP Helmerich & Payne, Inc. 55 2.75 151
JNJ Johnson & Johnson 30 2.80 84
KMI Kinder Morgan, Inc. 1,000 1.96 1960
LTC LTC Properties Inc 300 2.04 612
MO Altria Group Inc. 200 2.08 416
MPW Medical Properties Trust Inc. 1,450 0.88 1276
NRF NorthStar Realty Finance Corp. 446 1.60 714
O Realty Income Corporation 900 2.28 2052
OGE OGE Energy Corp. 220 1.00 220
OHI Omega Healthcare Investors Inc 88 2.20 193
OXY Occidental Petroleum Corporation 252 3.00 756
PG The Procter & Gamble Company 45 2.65 119
PM Phillip Morris Company 130 4.00 520
SO Southern Company 88 2.17 191
SPAN Span-America Medical Systems Inc 145 0.64 92
T AT&T, Inc. 224 1.88 421
TIS Orchids Paper Products Company 200 1.40 280
UTG Reaves Utility Income Fund 100 1.815 182
VGR Vector Group Ltd. 450 1.60 720
VTR Ventas, Inc. 200 3.16 632
VZ Verizon 200 2.20 440
WMB Williams Companies Inc 235 2.36 554
WPZ Williams Partners L.P. 335 2.36 790
Total     YOC 9.26 16,534

Cash end of month $12,535. Add in 200 shares of LTS-A to be sold and I have roughly $17,000 or $1000 a month + current income per month of ( $16,534/ 12 ) $1,377 to purchase positions going forward. Note I have shortened everything from end of 2017 to end of 2016.

This is just a guide, as all depends on what the market gives as to how long the cash lasts.

Month

$17,852 income goal end of 2016

End of month Dividend side income Amount short Months to end of goal Amount of income needed to add each month to hit goal Yield needed @ $1,377 a month reinvested income + $1000 cash added
June $15,361 $2491 30 $83.03 3.67%
July $16,534 $1318 17 $77.52 3.26%
August     16    
September     15    
October     14    
November     13    
December     12

Disclosure: I am/we are long AMLP AMNF BBL BGS CLMT CVX GIS HP JNJ KMI LTC MO MPW NRF O OGE OHI OXY PG PM SO SPAN T TIS UTG VGR VTR VZ WMB WPZ BBEP KMI-WI LTS-A SDRL SOUHY.

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

Additional disclosure: The author is in no way an investment professional, just an individual investor marching to his own drum.