Bert's Dividend Stock Purchases Report: June 2022
Summary
- Article discusses the dividend stocks purchased in June and the dividend income added as a result. The stock market was extremely volatile last month with rising inflation, interest rates, and soaring gas prices.
- We have been adding to our dividend stock portfolios for over 10 years and are now closing in on $20,000 annual dividend income.
- Stanley Black & Decker’s dividend yield has swelled to 3%, at moments, after the company’s downturn in 2022.
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This article discusses the dividend stocks we purchased in June and the dividend income added as a result! The stock market was extremely volatile last month with rising inflation, interest rates, and soaring gas prices. Stock prices swung wildly, presenting many buying opportunities for eager dividend growth investors like ourselves.
Why Do We Buy Dividend Stocks?
Our goal is to reach financial freedom by building a growing passive income stream. That passive income stream is built on the back of dividend growth stocks. We have been adding to our dividend stock portfolios for over 10 years and are now closing in on $20,000 annual dividend income!
We are able to purchase a large amount of dividend stocks because we save a high percentage of our income. We live frugally and play great defense with our hard-earned dollars. When we aren't investing the money, we park the extra cash in high-yield savings accounts at places like SoFi and Yotta.
Each extra dollar is critical when building this dividend stock house. Brick by brick, we are working towards building this beautiful place to live. That's why I'm excited to share our stock purchases from the last month. You can see the dollar impact of each and every purchase!
June 2022 Dividend Stock Purchases
This section is going to dive into our dividend stock purchases. We will share in greater detail the largest dividend stock purchases from June. Then, we will briefly mention the smaller stock purchases. Let's dive in and share each purchase and the amount of forward dividend income added.
Dividend Stock Purchase #1: Johnson & Johnson (JNJ)
Every week, my wife and I add one share each of Johnson & Johnson. We love the Dividend King and are not shy about it. It is one of our Top 5 Foundation Stocks for a reason and is one of the G.O.A.T.s in the consumer healthcare and pharmaceutical sector.
We started this weekly purchase journey in March 2021. Now, we both own 80 shares each. We recently talked about how we want to reach 100 shares each before re-evaluating this weekly stock purchase strategy!
So let's look at how the month of June shaped up. We each added 4 shares of JNJ, or 8 in total. We added $1,400 combined in the Dividend King. In fact, our average cost per share was $175.16 per share. That's definitely higher than it has been in recent months. The new dividend income added from the stock purchases was $36.16 and our average dividend yield on purchases is 2.58%.
Dividend Stock Purchase #2: Fulton Bank (FULT)
We initiated a position in Fulton Bank, a $26B+ large community bank, for a few reasons. First, it serves a huge market, in Pennsylvania, DC, New Jersey, Virginia, and the rest of the east coast.
Second, the company's Price to Book Ratio is below 1X. Currently, it is at .99X. That is right in our purchase zone, as we look for companies with Price to Book Ratios between 1X and 1.25X.
Thirdly, did we mention the dividend yield? Fulton Bank's dividend yield is currently over 4%. That is based off of their regular dividend as well. The company also pays a small, special dividend in Q4 that adds a little extra treat for shareholders.
You know the two of us right now. We love banks. Therefore, it is natural that my wife and I started a position in another strong yielding bank. I love that this stock also pays a dividend in the first month of the quarter too. So we are increasing our income in a month that is typically lagging.
In June, we initiated our position ahead of the June 30, 2022, ex-dividend date. We now own 46.041 shares after investing $668.03 total. This added $27.62 of forward dividend income at a yield of 4.14%! We are marching towards a position of at least $1,500 - $2,000.
Dividend Stock Purchase #3: Stanley Black & Decker (SWK)
This is another stock we have been purchasing for my wife's portfolio. This Dividend King has had a rough 2022. Stanley Black & Decker is down over 40% year-to-date. Supply chain issues and rising costs have taken a toll on the company. In fact, there is a new captain of the Stanley Black & Decker ship!
Stanley Black & Decker's dividend yield has swelled to 3%, at moments, after the company's downturn in 2022. At the moment, the yield is below 3%. However, we've benefited from grabbing shares at 3% at certain points in 2022.
July should be a fun month for Stanley Black & Decker as well. Why? This Dividend King is expected to announce a dividend increase! I'm expecting the company's dividend increase to be in the low to mid percentage point increases due to the tough year. Still, I'll take it!
June was unique because the company's stock price hit its lowest price. Look at the chart above. As you can see, there were moments when the stock price was kissing $100 per share. We added a few shares as the price was in that range. The following table summarizes our Stanley Black & Decker purchases.
We added 6 shares during the month at an average share price of $107.40. In total, we added $18.96 in dividend income, at an average dividend yield of 2.94%. We are closing in on 20 shares total. Man, it would be fun to hit at least 30 shares over the next few months. Now, let's cross our fingers and hope for a strong dividend increase in July.
Dividend Stock Purchase #4: Huntington Bank (HBAN)
Back to the banking sector. For every reason we purchased Fulton, we purchased a larger bank with a higher dividend yield! Early in June (June 9th and June 10th), I added to our Huntington Bank position to push it over 100 shares. We now own 115 shares of the Columbus-headquartered Top 20 Bank!
Huntington's dividend yield is impressive. At the time of our dividend stock purchase, the average yield was 4.79%. Now, after the price has fallen further, their current dividend yield is well over 5% today. Maybe I should look to add more…right?!
Huntington's current price to book ratio is currently 1.09X. It falls in our favorite 1.0x to 1.25X that we use when assessing whether a bank is undervalued or not. Compared to some of the larger banks, such as J.P. Morgan (JPM), this is definitely undervalued.
Our two purchased of Huntington are summarized in the table below. In total, we added 34 shares to our position, adding $21.08 to our forward dividend income. The average share purchase price is $12.93 per share. The stock's price is currently sitting at $12.10 per share. Therefore, this may be another great stock to add to our watch list. It would be a cool milestone to increase our stake from 115 shares to 200 shares over time.
Other Dividend Stock Purchases
The four previously discussed stocks were the largest purchase for the month. In this section, we will aggregate the rest of our stock purchases. Some purchases were for many shares while other purchases added just 1 share to our portfolio. The following table summarizes the remaining dividend stock purchases we made in June 2022.
The "Other" purchases added up to a healthy amount of dividend income, in aggregate. The chart above highlights the fact the "Other" purchases totaled $900+, adding $32.69 of dividend income.
Citigroup (C) was the largest purchase of the group. We started our position in 2021 and have continued adding to our position as the price gets slammed in 2022. Apparently, our stock purchase articles and videos caught the attention of Mr. Buffett. Like us, he is building a position in Citigroup himself (although his stake is much, much larger)! After the 5 additional shares, we now own 43.018 shares. Getting to 50 shares would be fantastic!
Cummins (CMI), Qualcomm (QCOM), T. Rowe Price (TROW), Intel (INTC), Starbucks (SBUX), and Provident Financial (PFS) round out the list!
Bonus: Fintech Stock Purchases
Last, but definitely not least, some other small purchases to discuss. This section deserves a section of its own….because these stocks do not pay a dividend! Like technology stocks, there is another sector that is getting crushed in 2022. That sector is fintech stocks. After several hot years of astronomical valuations and rocket growth, some of the largest players in the sector are seeing valuations slashed and stock prices plummet. I do work in the fintech sector myself, so it is fun to pick up some stocks in the sector that you are monitoring daily.
The first Fintech stock purchased was SoFi (SOFI). I've definitely hinted at the purchase for a while. SoFi has its doubters, clearly. The stock is getting hammered and the company is working through some painful growth. Plus, the student loan payment freeze has taken a toll on this company's top line in the short term. A massive source of revenue just disappeared. The company has diversified its revenue stream since then, growing to be a major player in personal loans, mortgages, and online banking in general.
They aren't just a fintech now, they are a bank. They have a massive deposit base and are growing it rapidly in an effort to reduce its operating costs. Their deposit account interest rates are 1.5%. What's crazy is that is still significantly cheaper than other sources of funding for fintech companies. I loved their full acquisition of Technisys and Galileo. They weren't cheap, but they are building critical infrastructure for themselves and to provide banking as a service. Again, there are plenty of risks. Don't want to discount that. But it's a stock I like in the growth corner of my portfolio.
Our purchases in June were relatively small. I'll keep grabbing small chunks of share while SoFi is below $6 per share. The table below shows that we grabbed 28.35 shares in June at an average share price of $5.57 per share!
We've been building our SoFi position since it was well above $10 per share. I've been averaging down my wife's position like crazy this year. This position isn't small, for the record. We now own 728.364 shares of SoFi at an average cost basis of $8.78 per share! Yeah, this is a growth opportunity in our portfolio. Let's see if the company can turn it around.
Lastly, I won't spend a ton of time on this last fintech stock, since our position is relatively small. However, I'm adding a few shares here and there of Upstart (UPST). The personal loan fintech company that uses AI and machine learning to price each loan individually is also having a rough 2022.
They ran into some issues last quarter, when it turned out that company was balance sheeting loans that it could not sell. The stock was absolutely crushed afterward. That's when we decided to nibble. While I don't feel quite as strongly about the long-term prospects for Upstart as I do SoFi, they have reached scale in the personal loans sector and have built a pretty impressive loan engine for banks and credit unions.
We purchased 5 shares at an average price of $31.24 per share. Now, we own a whopping 11 shares of Upstart! I'll nibble here and there if the company continues to remain in the low $30 per share!
Summary - June Stock Purchases
What a crazy month of stock purchases this was. In total, we added $4,371.30 to our portfolio, which will produce $136.51 in forward dividend income! Our Yield on Cost is 3.12%. That's more than double the current yield of the S&P 500!
We're pumped up and blessed to be able to add this much to our dividend stock portfolio in a given month. It's really going to help fuel our journey towards financial freedom. With each passing month, we are getting one step closer to reaching the end game.
What stocks did you purchase in June? What do you think about our dividend stock purchases? Are you buying any non-dividend stocks as well? How much dividend income did you add this last month?
Editor's Note: The summary bullets for this article were chosen by Seeking Alpha editors.
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