- Portfolio Value was up 2.75% in February and 3.64% Ytd with 7 add on buys, 1 new ETF, 1 trim and 2 sells with all transaction prices revealed.
- Dividend income was up 8.5% from Feb 2020 and up 6.62% from Nov 2020 Q4 from 20 payers with 3 raises and even 2 cuts.
- Dividend yield dipped a bit to 4.6% from 4.7% last month but the goal of increasing defensive sector % income rose slightly and is discussed.
- All 96 stocks are listed by % income, high to low, along with % portfolio value, sector, % dividend yield and S&P credit rating to aide the portfolio goal of quality add on candidates and keeping position size in check.
Source: (Author) Rose’s photo of miniature pink garden roses
The Rose Portfolio
96 stocks currently form the portfolio. It is a conglomerate of 3 brokerage accounts, 2 Roth, 1 taxable trust and 6 separate company stocks thrown into the mix. Very few sales will occur in the taxable account which also receives a yearly RMD, required minimum distribution, from a separate not included IRA. I will reveal the taxable account sales when they occur of which none were done this month. The required 2021 RMD was already done in January as cash and is small or ~ 0.35% in comparison to the total Rose portfolio. All dividends generated are still retained in the portfolio and reinvested at my discretion and included in each month's transactions. A more comprehensive portfolio listing of quality and price was done in the January review article here and reveals some nicely priced winners too, at least at the time.
The primary goal for the portfolio is income, as growth has been accomplished satisfactorily now that we are retired. The listing below is therefore from the perspective of %income from high to low for all 96 stocks along with the other metrics and abbreviations that are used as follows:
- S&P Cr R: Standard and Poor credit rating from “FG” Fastgraphs subscription service. The more quality ratings (As and BBB+) are shown in bold.
- 2021 %PV: % portfolio value on February 27th, 2021.
- E 2021 %PInc: % estimated portfolio income for 2021 as known or shown from FG.
- Sector: there are 11 that I and most brokers use for each security type. Those listed in bold are for the defensive sectors.
– RIC refers to Regulated Investment Company
– Misc RIC refers to 2 types for me; BDC/ Business Development company ( I have 7) or mREIT or mortgage REIT/real estate investment trust (I have 1).
– Real Estate sector holds all eREITs or equity real estate investment trusts.
- Dividend is based on the yearly estimated dividend and the stock price on the same date the portfolio value was established on Feb 26th.
With almost 96 stocks any position with %income > than 1% would be considered the average.
Get ready this is a long list, so it is divided into % income sections for easier viewing, so let’s begin:
Income 2 % or greater- 18 companies
These are all above that 1% average size and probably could be considered completed. However, if a bargain price arises they will always get due consideration as they can be trimmed in the future as well. Nothing ever wrong with buying a great quality stock at a low valuation.
|(TGP)||Teekay LNG||no K1||1.90%||3.06%||Energy||7.4|
|(IRM)||Iron Mt.||BB-||1.87%||2.85%||Real Estate||7.1|
|(PM)||Philip Morris||A||2.26%||2.81%||Cons S||5.7|
|(PFLT)||Pennant Float||1.32%||2.75%||Misc RIC||9.5|
|(ARCC)||Ares Capital||BBB-||1.37%||2.60%||Misc RIC||8.7|
|(NMFC)||New Mt. Fin||BBB-||1.18%||2.50%||Misc RIC||9.6|
|(CGBD)||TCG BDC||0.97%||2.32%||Misc RIC||10.9|
|(SPG)||Simon P G||A||2.36%||2.28%||Real Estate||4.6|
Abbvie leads the list with 5% of the total income. It just raised the dividend by 10.2%, and the happiness with owning it just keeps growing! The BBB+ credit rating is extremely acceptable to me.
It should be easy to see the energy and Misc RIC category gets represented here easily for their “HY” high yield. A little % of portfolio value can add up quickly with owning them. JNJ is a very quality triple A rated company, but it takes a lot more in value to get equal income. Safety of the dividend and quality are always important metrics I try to use for purchases and to keep size valuations in check. I watch them all and most recently began adding on to Merck for nice valuation and high credit rating of AA-. The most recent purchase price is found in the February transaction section.
Income 1% or greater- 20 companies
|Ticker||Stk Name||Cr R||%PV||%PInc||Yield|
|(FSK)||FS KKR Cap||BBB-||0.69%||1.87%||Misc RIC||12.5|
|(WPC)||W. P. Carey||BBB||1.43%||1.78%||Real Estate||6.1|
|(TCPC)||Blkrock TCP||BBB-||0.77%||1.56%||Misc RIC||9.3|
|(ARDC)||Ares Bond Fund||0.88%||1.52%||Fin/Funds||7.9|
|(KMB)||Kimberly Clk||A||1.72%||1.31%||Cons S||3.5|
|(DNP)||Duff N Phelps||0.71%||1.17%||Utility/Cef||7.5|
|(KO)||Coca Cola||A+||1.46%||1.09%||Cons S||3.4|
WP Carey is the newest addition here and I have gotten it to a very nice % income. With being a "HY" eREIT a credit rating of BBB is very acceptable to me.
A small amount of LMT was also added this month, I like it over 3.2% yield and now I am aiming for 3.3%, as you can see it is not a priority, but I do believe it has defensive by nature qualities.
BMY is A+ credit rating and now 3.2% yield, I have sold puts to obtain some in March for a strike of $62.50, hope I get them. The Fortune Teller also has suggested puts for it in his service “WoF” , but I admit to doing it my way again, but at least we are still looking to obtain the same stock. No ones way is best but trying and succeeding is always the goal to get shares cheaper.
Income 0.5% or greater- 22 companies
|Ticker||Stk Name||Cr R||%PV||%PInc||Yield|
|(PEP)||PepisCo||A +||1.25%||0.89%||Cons S||3.2|
|(HMLP)||Hoegh LNG||no K1||0.35%||0.86%||Energy||11.4|
|(KNOP)||Knot Offshor||no K1||0.30%||0.81%||Energy||12.5|
|(TWO)||Two Harbors||0.38%||0.77%||Misc RIC||9.4|
|(GEO)||Geo Grp||BB-||0.19%||0.59%||Real Estate||13.8|
|(BPYU)||Brookfield PR||BBB||0.31%||0.52%||Real Estate||7.6|
|(IFN)||India CE Fund||0.25%||0.52%||Fin/Funds||9.7|
All of these should and could be considered for adding on to. I have done so just last year with the top 3, PEP, AMGN and CSCO, but wouldn't mind more. I continue to watch them as they are even the best value priced candidates right now and 2 are in defensive sectors that I wish to expand. Many of the others are just too expensive or over loved at the moment, other than perhaps PFE, which I am not sure I want over perhaps BMY, so I wait.
Income 0.1% or greater – 23 companies
|Ticker||Stk Name||Cr R||%PV||%PInc||Yield|
|(NNN)||Nat Retail Prop||BBB+||0.46%||0.47%||Real Estate||4.7|
|(NYCB)||NY Comm BC||BB+||0.27%||0.33%||Fin/Funds||5.6|
|(PTMN)||Portman Ridge||0.12%||0.31%||Misc RIC||11.8|
|(GIS)||General Mills||BBB||0.33%||0.27%||Cons S||3.7|
|(SJM)||J. M. Smucker||BBB||0.33%||0.23%||Cons S||3.2|
|(AEM)||Agnico Egl M||0.38%||0.20%||Material||2.5|
|(SLVP)||ETF Silvr Mnrs||5*||0.19%||0.11%||Material||2.6|
For many reasons these remain low in income value:
- growth quality stock with low income such as Visa and MA
- core position that is over valued: CMI, UNP , WEC, TGT, HSY all are on hold
- building a position- the price rises faster than I can complete it, but still happy to own: NNN
- exiting slowly maybe: KHC
- happy with a small amount and watch to add if price cooperates.
- owning with hope that it will rise up one day: MAC
- speculation buys
Many of the above reasons also apply to the following
INCOME 0% to 0.1%- 13 companies
|Ticker||Stk Name||Cr R||%PV||%PInc||Yield|
|(SILJ)||ETF Jr Silv Mnr||0.14%||0.04%||Material||1.3|
|(TAP)||Molson Coors||BBB-||1.06%||0.00%||Cons S||susp|
Some of these will rise up in income as I wait for a suspended dividend to reinstate: TAP, CLNY and TEVA
I am not sure what to do with it as yet : MET, but in taxable and I don’t care if it stays there forever.
I am exiting OXY, EPR, VIAC and CXW through call options to get a higher price, at least at the time they were done. EPR price has risen beyond imagination, I might need to roll my option and just sell it, but there is time. It still has no dividend but has huge backing of some sort pushing the price higher.
DIVIDEND INCOME for February
I love collecting dividends and the income was up 8.57% from Feb 2020 and 6.62% from the comparable 2nd month of Q4 or Nov 2020. It gives the portfolio a 4.6% yield compared to 4.7% for January; all due to rising valuations (smiling).
The following chart shows the dividends collected from 20 companies with 3, possibly 4 raises and 2 cuts. I have trouble with Vodafone, but I think it was a raise, as they give 2x per year dividends and in varying amounts, but it seems to be a bit higher. The next dividend will be different so it is always a guessing game for me. Date of arrival starts the list and then dividend per share and yearly amount (hard to determine with VOD). Miscellaneous pertinent information is in the last column.
|FEB||STOCK||per share||Amount||Yield and other Info|
|1||BMY||0.49||1.96||Raise from 45c yield 3.2%|
|1||CVS||0.5||2||No raises Yield 2.85%|
|1||GEO||0.25||1||cut from 34c Yield now 13+%|
|1||T||0.52||1.08||No raise yet Yield 7.2%|
|2||PFLT||0.095||1.14||monthly pay yield 9.5%|
|5||VOD||0.5459||1.09||Record date Dec 18 Yield 6.3%|
|5||GD||1.1||4.4||raise due next yield 2.7%|
|9||MA||0.44||1.76||raise from 40c yield 0.5%|
|10||DNP||0.065||0.78||Monthly pay yield 7.5%|
|12||CEQP||0.2111||0.8444||K1 tax- Fix pref yield 10.8%|
|12||TGP||0.25||1||Yield 7.4%/ raise next|
|16||ABBV||1.3||5.2||raise from 1.18/ yield 4.8%|
|18||AMLP||0.71||2.84||cut from 75c/ yield 10%|
|26||ARDC||0.0975||1.17||monthly pay/ yield 7.9%|
- GEO cut again to 25c and with $17.54/ share the yield or YOC is 5.7%. I am struggling to exit and should make up my mind soon.
- AMLP cut the dividend surprisingly by only 4c and still has a yield of 10%; okay for me for now.
- T might give a raise next time, and I am still waiting for CVS to do so perhaps by the end of this year.
- GD will raise next time, and I believe TGP will do so as well.
- VOD date of record was Dec 18th 2020 and they paid it this month.
PORTFOLIO VALUE is UP
The portfolio value is up nicely by 2.75% for February and 3.64% Ytd with a yield of 4.6%. In comparison, The S&P 500 index (^SPX) was up 2.6% and 1.4% Ytd with a yield of 1.57%. The Fastgraph “FG” Chart below from the paid subscriber service by Chuck Carnevale shows the following:
-black line is the price = 3829
-blue line the normal P/E ratio of 20.97
-orange line an average comparison P/E of 15
-white line represents dividend level and pay out within the dark green area of earnings
The estimated future representation with dotted lines shows the S&P price is a bit ahead of itself and priced already at the 2022 normal P/E with suggested earnings of 199.
Interesting and historically the S&P and most stocks will tend to revise back to the normal P/E blue line. When it will happen is anyone’s guess, just know some stocks are trading in high valuations and should be bought with that mind.
Numerous add on buys, 1 new ETF , 1 trim and 2 complete sales highlight the list. The 2 sales and 1 minor trim provided most of the cash for add on buys as February was not a huge month for dividends. I love March much better when 50% of the portfolio pays.
GLOP-A and C preferred shares
These were original ideas a few years ago from The Fortune Teller “TFT” and the service Wheel of Fortune “WoF”. They have yearly distributions of $2.16/2.13 and offered ~10% distribution that will be missed. They had been trading extremely low late last year and made a huge comeback which allowed me and others finally to sell. The patience needed to wait for the right exit time for the proper price was provided at WoF. I was tempted many times to exit much earlier, but owe getting near cost to the constant encouragement from TFT to wait. A huge reason to exit these was there was a buyout offer for GLOG shares or GLOP parent and the future for the preferred shares distribution could be uncertain or even abandoned. Therefore it was sold to reduce risk, pure and simple. Both were sold for almost break even cost and Rose is smiling.
NGL has suspended the dividend on the common shares and it is believed the preferred shares and payments will also follow if not already. I only trimmed by 25% to reduce risk of owning it for now.
SILJ is an ETF of junior silver miners with a higher capitalization than the SLVP senior miners, which is also owned and this will offer some more silver mining diversification. The current top holdings in the ETF as listed by Yahoo Finance source March 1st is shown below. They are mostly Canada and Mexico jurisdictions which are considered to be safer mining locations.
The fund contains (HL) Hecla, which is one of the few silver miners actually in headquartered in the good ole USA in the state of Idaho. It has holdings in Alaska, Canada and Mexico as well. As a speculation I bought it alone and a small amount of shares for $5.41 and rode it up to $6.70 in 2 weeks time. I sold 50%, making 22+% and still hold the remainder. WoF offered some $6 strike puts to buy more at a lower price which I will get in June if successful. If that happens I will relate the full story at that time. Right now, I own a small amount, but wanted to share the trade and what the future might bring. It is not shown in the transaction chart, but worth the mention.
These adds were mostly miners as I believe just as TFT suggests that inflation will be upon us in the future with commodities being a valuable hold for it. I personally also like LMT and its defensive nature and added a bit more. VTRS started a dividend and it seemed like a nice time to add more and will do so if the price continues to fall. It is also a choice at WoF and options have been suggested for it as well. Merck a very quality healthcare defensive name is showing price weakness, so I added more with its now 3.5% dividend yield.
There were no successful options completed in February. March hopefully will have some, as I have sold puts to own more BMY and another put in June. Here they are so you can follow along with me.
- BMY $62.50 strike Put for Mar 19th; premium of $4.10 that would give shares at $58.40.
- BMY $65 strike Put for June 18th ; premium of $5.70 that would give shares at $59.30.
The premiums have been received and are already included in portfolio value, so now waiting is the hard part. These and other successful options done will be revealed in the transaction section each month. Follow along and cross your fingers for getting successfully some more BMY.
INCOME YIELD and DEFENSIVE GOAL
Income yield of 4% is the general portfolio goal which has been met easily with being 4.6%. I also have the desire to bring income to 50% from defensive sectors. Owning defensive names in other sectors, such as LMT will just have to be a bonus. The tech sector is considered often to be defensive, but for now I have not included it.
The list below shows:
- # of companies in each sector
- % portfolio value
- % portfolio income
There are 35 companies and 1 fixed company bond in 5 defensive sector holdings with their statistics shown in bold print in the chart below.
The 36 defensive names provide 50.31% by value, but only ~45% of the income. I will continue to try to raise that income to 50%, with that goal in mind for all transactions.
There are 72 common stocks that provide ~ 80% of the value and 71.5% income.
The 19 RIC includes real estate have the “HY” high yield major components, as being 15% value and yet 24% income and the really fun exciting part of the portfolio and also need the most monitoring/ watching.
With energy in focus and valuations rising recently, I am showing the components of those 10 holdings separately in the chart below.
The IOCs or Integrated Oil Companies have HY, but less than MLPs. Major Limited Partnerships, which easily provide almost double the income for value right now. None of these have K1 tax forms.
The income lists reveal the real commitment to the more valued quality core stocks. Most are established with some more speculative HY stocks playing a fun interesting exciting part in the total portfolio with a few solid growth stocks for diversification. The BDCs/RICs bring more dividend excitement, but the core lower yield reliable dividend payers give a steady and basic solid foundation for the portfolio. More recently commodities and emerging markets stocks have been added as well for an even more diversified total portfolio. I also like that many pay dividends, if even small-ish.
March is a favorite quarterly dividend collection month and I will be building reserves of cash with always hopes of future bargains for any or all of these quality stocks/investments.
Happy Investing to you all!
Source: (Author photo) Cactus Roses in Rose’s garden bloom for 1 week only each spring
This article was written by
I am a Promoting and Contributing author for Macro Trading Factory run by The Macro Teller / The Fortune Teller. The following list shows the # of stocks in each sector along with the largest holding. All stocks listings and statistics are presented at The Macro Trading Factory service alphabetically with sector, credit ratings, current and forward dividend information, yield, x-dates, pay dates, charts and more. All portfolio changes, sells and buys get a Trading Alert and a service article.
- Quality, low debt companies with great credit ratings and selling at a fair or better price and with a safe and rising dividend.
- To keep defensive stocks/sectors at 50% Portfolio Income.
- Also needed is continued patience watching and waiting for it to happen. Doing nothing when others panic makes for success!
Update: July 1, 2023.
How to join Macro Trading Factory: explained here: https://seekingalpha.com/author/the-macro-teller/research.
Sectors and holdings are as suggested by Bloomberg. Some positions are large and some small ; The service has listings for all 78 and shows all trading moves since inception late in 2021.
Consumer Staples (10 stocks): (PM) / Philip Morris
Healthcare (9) : (MRK ) / Merck
Communications- tele (3): (VZ) / Verizon
Utility (9): (XEL) / Xcel Energy
Consumer Discretionary (2): (HD) / Home Depot
Energy (7): (ENB) / Enbridge
Tech/ "fin-tech" : (4): (AVGO) / Broadcom
Industrial- Defensive (2): (LMT) / Lockheed Martin
Industrial (6): (SBLK) / Star Bulk Carriers
Material (2) : (FMC) FMC Corp.
Financial: (15): (10) BDCs/ (ARCC) / Ares Capital, (1) bank, (1) ETF CEF , (1) BDC preferred and (2) mREIT
-Fixed Bond (1): STWD
-Financial Bond ETF (1): JPST for cash parking
REAL ESTATE (Healthcare REITs): (3) : (OHI) / Omega Healthcare
REAL ESTATE Misc (6): (SPG) / Simon Property Group
Happy Investing to ALL !!! Rose :))
Analyst’s Disclosure: I am/we are long LMT. 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.
I am long all 96 positions in the charts. The article is for information purposes only in regards to my dividend portfolio structure and goals. Happy Investing to all!
Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.