In my web wanderings, I encounter many disparate views on investing. Some I agree with, others I don’t. Then there are the few I can’t even wrap my head around. About a year ago, it appeared that sentiment had begun to shift. One post, The dark side of dividend income by Bite-Sized Income (now dormant) highlighted this change. In a nutshell he presented an argument that dividend investing (@ 4%) is not worth the time. A plausible scenario is presented but it is unlikely the majority of us could capitalize on it.
Month 2 of each quarter are my lowest dividend payment months of the year. And it’s destined to get worse now that my last First Niagara dividend check has arrived. Their merger with KeyBank makes them a month 3 payer now. Since I’ve got a couple of mergers left in left in the portfolio, it appears I’ll be reassessing the monthly payment flattening issue going into the new year. On to Rant #2 …
Yesterday I added to my Kimberly-Clark position. Now I have to admit to the possibility (probability?) that it’s overvalued. Passive Income Pursuit made a good case to this effect in his recent article on Seeking Alpha. Besides our differences – his being growth oriented whereas I don’t mind the “bond like quality” – there are (I feel) a couple of gaps in his analysis.
First, KMB has demographics on its’ side. Not only diapers, as mentioned, but elder care products as well. Second it’s not clear that the article fully accounted for the HYH spin other than to note an increase in goodwill. Granted, KMB has some headwinds but in a normal economic cycle my guess is they would be out in front of them already. KMB is Exhibit A for the so called ‘Earnings Recession’ the TV talking heads like to banter about.
Therefore I added to my existing position at $130.15 per share. This will increase KMB’s share of my dividends from 3.43% to 4.09% (with a target maximum of 6%) and provide an initial yield of about 2.8%. At least I’m leaving a little room to add in the event of a dip. 🙂
It seems that at times I seem to be a little late to the party. In late 2013, I stumbled across investment blogs and the DGI community in particular. With a knowledge of databases, I began to enter blogs I encountered into a table followed shortly thereafter by their holdings in another table. Obviously Ferdi (DivGro) had a similar thought as in February 2014 he presented the initial Blogger’s Portfolio. Initially 31 stocks within 20 portfolios, it was subsequently expanded to its’ current form of 60 companies within 43 portfolios.