November 2018 Update

To my surprise, the S&P shrugged off the headlines last weekend finishing the month positive.  While I agree with  Joseph Calhoun’s assessment:

There have been a litany of one-off events over the last year that made GDP growth look better than the underlying trend. We should call the last year – with rebuilding from four hurricanes, front running of tariffs and a federal budget blowout – the Potemkin economy. It looks okay on the surface but there isn’t any depth to it. And I think we’re about to find out what it really looks like behind the facade as those three big artificial stimuli wear off.

We will probably have to wait until the first quarter to be able to get a peek behind that curtain.  So November was kind to the index, allowing it to recover a little from October’s nasty drop – settling up 1.8%.  Meanwhile my portfolio outperformed the index again, registering a gain of 2.54%.  YTD I’m ahead of the S&P by 2.1%.

Portfolio Updates:

  • initiated new position: AFG (in time to collect the special dividend)
  • added to WEC (missed to ex-div)

DIVIDENDS

My main focus resides on dividends.  Market gyrations are to be expected but my goal is to see a rising flow of dividends on an annual basis.  I’m placing less emphasis on the quarterly numbers as the number of semi-annual, interim/final and annual cycles have been steadily increasing in my portfolio.

  • November delivered an increase of 46.72% Y/Y, the impacts being dividend increases and especially special and merger dividends.
  • November delivered a 5.13% decrease over last quarter (Aug) attributable to semiannual cycles.
  • Dividend increases averaged 15.38% with 77.58% of the portfolio delivering at least one increase (including 2 cuts (GE, SRC).
  • 2018 Dividends received were 111.48% of 2017 total dividends exceeding last year’s on October 19th.

Note: I updated my Goals page to provide a visual of these numbers.  Based on Mr All Things Money’s instruction set with a conversion to percentages.  My code only updates when the monthly Y/Y number is exceeded.  Otherwise, the prior year actual is used.

Spinoffs:

GE‘s rail unit to spin then merge with WEB

GE to spin 80% of the health business (maybe)

NVS proposed spin of Alcon scheduled for shareholder approval Feb 2019

On Oct 4, MSG filed a confidential Form 10 to spin the sports business

Mergers:

XRX merger with Fujifilm cancelled (still being litigated).

SHPG to merge into TKPYY (regulatory approvals received, pending shareholder vote)

GBNK to merge into IBTX (shareholders approved)

GNBC to merge into VBTX (semi-reverse)

BNCL to merge into WSFS

BHBK to merge into INDB

Summary

This month should be fairly benign on activity with a couple of rebalances planned on about 5% (perhaps less) of the portfolio.  End result will be an increase in some holdings – and perhaps one new – as part of my excess cash will be deployed.

Hope your November was equally as good – or better!

 

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DRIPs & Ugly Customer Service

Today I went on a quest, spurred by an article I encountered a few days ago over at the StreetAuthority, titled Reinvest Stocks At Discounted Rates With This StrategyOK, I’m a sucker for a bargain.  And this is a technique I’ve previously used.  So what’s different?  One comment in the article caught my eye.  “there are a number of companies that offer DRIPs with a discount. They are just really hard to find”.  I thought “Oh really.  How hard could it be?  Well, let me tell you …

I started with Amstock.  They (and their sister company CST) are privately held  and owned by Pacific Equity Partners out of Australia.  I had to do some cutting, pasting and sorting but I came up with a list of 18 companies:

ACFN, AFG, BXMT, BRT, CECE, EFSI, ETP, HT, MEG, MNR, NNN, OLP, SBTB, SSW, SSS, SUBK, UMH, YORW

Can’t say I’d be buying many of these myself , but a good start to my  journey.

So I then went to the big one – Computershare.  Since I just bought some of their stock, I figured to get answers.  Wrong.  They do provide the information on their website, but it’s two additional clicks to get the answer.  With the thousands of plans they manage, there just had to be a file to download.  Nope.  Well I’m not that bored (at least today) to go to that effort.  So strike one.

Next up was Wells Fargo.  They managed Piedmont’s plan (which had a discount).  They manage about 160 plans and as a stockholder, maybe they’d cut me a little slack.  Strike two.  They’re even worse.  You go to the list on their site, click on the company, then click on the document so you can read each and every prospectus to see if a discount is offered.

While I still had a strike left I gave up without checking Broadridge or DST.   These are smaller – Broadridge has Disney as a client and I know no discount is offered there.  At least it provided a semi-productive way to spend a rainy day.