September 2018 Update

It was a tale of two markets this month with highs being set on the 20th before pulling back through month end.  It’s a riddle of sorts when consumer sentiment is off the charts and the ultimate consumer stock (BBBY) plunges on terrible sales.  How about the Fed raising rates again but bank stocks fall?  Then Mexico appears to tap the brakes on a possible bilateral trade deal in favor of retaining a trilateral including Canada with the Trump threat being tariffs on Canadian cars.  Yes, a conundrum indeed. I was off the sidelines during the first half of the month but going silent during options expiration and the sector changes later in the month.  September saw a rise in the S&P of 0.43% while my portfolio lagged by registering a decrease of 0.42%.  YTD I’m ahead of the S&P by 0.21%.  The biggest factor being my cash position – which is normally minimal.  I only report stock positions – but if cash were reported the results would have been a wash.

Portfolio Updates:

  • added to KMB prior to ex-div
  • added to GBNK (hedge on IBTX merger)
  • sold IBTX (locking in a 46% gain – I’ll get these back post merger)
  • sold one CHD position (completed last month’s repositioning)
  • sold one JNJ position (completed last month’s repositioning)
  • added to CMA (minor rebalance)
  • added to EPR (minor rebalance)
  • added to CBSH (minor rebalance)
  • added to FFIN (minor rebalance)
  • added to MAIN (minor rebalance)
  • added to MKC (minor rebalance)
  • added to PYPL (minor rebalance)
  • added to PNC (minor rebalance)
  • added to PRI (minor rebalance)
  • added to SHPG (minor rebalance)
  • added to TSS (minor rebalance)
  • added to UNH (minor rebalance)
  • added to VLO (minor rebalance)
  • added to V (minor rebalance)

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.

  • September delivered an increase of 13.54% Y/Y, the impacts being dividend increases and a sizable special dividend (AMC).
  • September delivered a 15.65% increase over last quarter (Jun).
  • Dividend increases averaged 14.96% with 71.03% of the portfolio delivering at least one increase (including 1 cut (GE).
  • 2018 Dividends received were 92.71% of 2017 total dividends putting us on pace to exceed last year next month.

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

NVS proposed spin of Alcon scheduled for shareholder approval Feb 2019

Mergers:

XRX merger with Fujifilm cancelled (now being litigated).

SHPG to merge into TKPYY

GBNK to merge into IBTX (shareholders approved)

COBZ to merge into BOKF (expected completion 1 Oct 2018)

GNBC to merge into VBTX (semi-reverse)

Summary

My repositioning is almost complete so next month I can begin to front load into 2019.   Dividends this month hit a new record.

Hope all of you had a good month as well.

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Dec 2017 Update and Year End Review

The upward trend continued this month with catalysts being the tax plan and holiday sales.  My guess remains that the first half of 2018 will be good for corporations (i.e., dividends and buybacks) with a shift in focus later with deficits and mid-term elections playing a leading role.  I remain convinced the yearlong weakness in the US Dollar will continue and expect to allocate more cash into foreign equities during the first half 2018.  I will review this plan as my personal tax implications become clearer.  For the month,   the S&P index increased by .98% while my portfolio increased by 3.29% largely fueled by Financials (again).  For the year the S&P increased by a stellar 16.26% while I came in at +20.58%! The S&P return with all dividends reinvested adds about 2.41% which my hybrid approach still beat.

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2015: What Went Right

Yesterday I published a post where I referenced an article by Bespoke Investment Group. During this season of reflection of the past year and anticipation of the one to come – aka goal setting – I figured further analysis of their article and its relationship to the DGI community might be warranted.

First I need to address the caveats:

  • Only publicly disclosed data culled from portfolios in my Blog Directory were used. If your blog is not listed, your data was not included.
  • My data only reflects a snapshot in time. Once entered in my database I generally make no updates.
  • I make no guaranty as to the accuracy of the data either through input errors, processing errors, or the legitimacy of the source data. Meaning, use at your own risk – or you get what you pay for.

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