Dividend Stock Investing

[The Virginian]

Huge Rumors of Phillip Morris (PM) acquiring Altria (MO) are going around !



This is a Huge Deal !

Will it make sense ??
Not sure what to think but it would create the powerhouse again and certainly give the new company a better footing and more Diversity ! If this goes through it could also set up future deals !

Stay tuned folks !

[The Virginian]

The Market sent a message today ----
It will cross 20,000 when it is Darn Well Good & Ready !

[ModE98]

Mr. V ..... That's a fact.......a day, a week, or whenever; BUT it is coming!

Bought a few more lots of VFC, HRZN while they seem nicely priced now for the long run.  Also a few UA (no div.) which may do well in the year ahead--cheap now.  Looking at K for possible buy.  These all have not yet caught fire in the Trump rally.

[gwenstacy]

Long-term investors can take full advantage of dividend stocks by harnessing the power of compounding interest. The best way to do that is to sign up for a dividend reinvestment plan (DRIP) and direct stock purchase plan (DSPP), should the company offer it. This allows you to automatically reinvest your dividends. You can also purchase shares, fractional or whole, without the need of having to use a broker. Buy-and-hold investing might not impress your friends, but it can be lucrative.

General Mills is a classic “buy-and-hold” stock. The company provides an annual dividend of 3.05%, or $1.92 per share. For income-starved investors, General Mills has paid an annual dividend for the last 117 years and increased its annual dividend yield for 14 consecutive years.

Costco’s dividend yield may not be the highest at 1.2% ($1.80 per share), but the company is a slow and steady workhorse, providing investors with capital appreciation and consistently raising its annual dividend yield. You can’t get much more dependable than this, which is why I added Costco to my “buy and hold” list.

Procter & Gamble might not be the most exciting stock, but it’s one of the best long-term stocks that has been quietly rewarding buy-and-hold investors. The company currently pays an annual dividend of three percent, or $2.68 per share. It has raised its annual dividend for the last 60 consecutive years. That’s what I call a “buy-and-hold” stock.

[The Virginian]

Things are really quite in the markets as I suspect a lot of Traders have started packing up for the Holidays. In fact I believe things will be slow until after the New Year starts. Very boring times for Junkies like myself.

Next week I plan to publish a list of my year end stock holdings and my results for the year and my annual "Guess" as   to the Direction  of the Market along with projected Gains/Losses - All in Fun of course because No one can really predict the Future.

 

[The Virginian]

Where is the Value for 2017 ?

Last year it was very obvious where the value was - Oil related stocks and Coal - Look back at the threads and you will see where I encouraged people to consider these stocks ...............

I made great money off of stocks like :

APLP (54.33%) , CNXC (163.58%) , ARLP (51.98%) , NGL(143.83%) , CCLP(66.21%)  ...............

But where are the good picks for 2017 ? It's not so obvious


My best guess is : Health Care and Pharma stocks

My Picks for 2017 ?

CCP, OHI , BMY, ABT, LLY, JNJ, ABBV, PFE

And one of my Losers was UAN (7.41%)  - but ....... I am holding and have faith it will be up more  in 2017 !

The only one listed that I do not own currently is CCP - But I do hope to add it in 2017 at some point !

I don't expect the whopping returns from 2016 but since the Pharma stocks are off about 17% in 2016 I do expect them to on average about 20% gains for 2017 !



If you have some good ideals - Please share them ! 

[The Virginian]

Buy these REIT Now for the Great Yields !

APTS - 6.30%
OHI - 8.05
CCP - 9.35
CLDT - 6.34
LXP - 6.56
LAMR - 4.45
SNR - 10.48
STAG - 5.96
------------------
7.18 % Average Yield !

Invest $100,000 = $7,180 Annually or $ 598.00 per month (Average) of income !

[The Virginian]

23 SWANS (Sleep Well at Night ) by Brad Thomas !
ireitinvestor.com/

[gwenstacy]

What to Look For in Dividend Stocks
Companies with a long history of paying a dividend and increasing it annually tend to be larger, well-run companies with an international footprint, consistent growth strategies, and a strong competitive advantage.

Why invest in a big company with a five-percent dividend yield when you can invest in a penny stock with a 15% dividend yield? There is a risk/reward trade-off when it comes to dividend-yielding stocks; the higher the yield, the greater the risk. Is it worth risking all of your capital on an unproven startup for a 15% yield?

High-dividend yields may be attractive when you’re looking at near-zero interest rates and central banks addicted to negative interest rates, but it’s important to understand what you’re investing in and what the risks are.

[The Virginian]

As of 12/27/2016 my combined portfolio returns were :

21.22 % for the Year !

Source - My Schwab Account

S&P = 10.62% (YTD)

DOW = 14.34% (YTD)

Source - CNBC

[The Virginian]

My Combined Portfolio Holdings as of 12/28/2016 :

(Taxable 1)
ACRE AGNC AINV AMID APTS APU ARCC ARI ARR BXMT CCLP CEQP CIM CLDT CNXC CORR CTL CVRR CYS DUK DX ETP FSC GAIN GE GEO GLAD GLP GOOD HTGC IRET KCAP LADR LAMR LXP MAIN MFA MITT MO NGL NLY NRZ OHI PAA PFE PSEC SBSI SCM SIR SNR SO SPH STAG STWD SXCP T TCAP TCRD TPVG UAN USAC VGR VZ WSR

(Taxable 2)
APLP ARLP CCLP CNXC CTL CVRR GOOD LADR SXCP MAIN NGL PSEC STWD T UAN WPG

(IRA)
T VZ KO PG GIS PSX PFE BMY LLY JNJ ABBV ABT GE STWD STAG OHI CORR WSR GOOD DX PM VGR DUK  INTC

Note : While I have no intention to sell these positions that could change as conditions warrant.

Dividend Income grew almost 25% due to a variety of factors including Dividend Increases and my selling some positions and replacing the holdings with higher paying Dividends.

Dividends are reinvested in Taxable 1 by taking cash and then looking for opportunities.

In Taxable 2 and the IRA accounts I mostly used the DRIPS.

[Deleted]

The Virginian, you may have covered this before but what is your tax strategy for dividends?

This is the first year I have had to adjust DW and my W-4 Tax withholding at work to make sure we were paying enough taxes for our after tax brokerage dividends. The plan going forward will be to do the same but with my projections over the next 10/15 years we will really start having some serious withholdings from our employer.

Just curious how you have managed it previously and now.

[The Virginian]

Dec 28, 2016 11:06:03 GMT -5 @aj said:

The Virginian, you may have covered this before but what is your tax strategy for dividends?

This is the first year I have had to adjust DW and my W-4 Tax withholding at work to make sure we were paying enough taxes for our after tax brokerage dividends. The plan going forward will be to do the same but with my projections over the next 10/15 years we will really start having some serious withholdings from our employer.

Just curious how you have managed it previously and now.

HI AJ, Since I am retired now it hasn't been too bad on me. I have one account that I do not Drip my Dividend Income so I have cash available to pay Uncle Sam his share. So from now until April I will hold that as cash to make sure I have enough to pay what is due. This year I do expect to take a big hit as I sold an investment (rental ) property that I will owe quite a bit on but I went ahead and invested the money any way which paid off,  but will bump up my taxes even more I expect. 

I know some people sell losers at the end of the year to help offset any Income but I do not subscribe to that philosophy ( sometimes last years losers become this years winners!) . I only sell when I no longer believe in a company or when I find what I believe to be a better opportunity. For the most part I just don't bother with worrying about taxes - only about making money !

[Deleted]

Thanks WXYZ, my grandfather does the same thing but what led him to it was his wild swings in income from farming, he eventually got sick of guessing and paying the penalty anyway so he plans to pay it every year now.

[The Virginian]

Where is the Market headed for 2017 ?

As Marc Faber points out we have not had a down Market year since 2008 - He thinks we are due for one !

Well he may be correct - but I personally think it will be another up year, too many positives right now and the momentum is heading upwards - I just hope that it is a steady and gradual climb and does not turn into a Circus Frenzy with everyone and their brother jumping into the Market for a quick buck. In 2008 the starting price for the DOW was 13264 -  The historical gain is about 10% per year so based on the eight year period the DOW should be at 23,875. We are just nearing 20,000.  We have gained only 6.25% per year average over this 8 year period. So based on my math and historical returns we are running below the 8% average returns that some adhere to.

So my bottom line - I think it will be another positive year with the DOW finishing around 23,000 by year end.

Disclaimer : Of course my prediction isn't worth the Digital Paper it is written on but it sure is Fun to Guess !

I hope every one of you has a very Productive and Prosperous year !

[The Virginian]

AT&T (T) is set to drop its Promotional Pricing for Direct TV Now -

Price to jump from $35 per month to $60 per month !

It was a great deal for those looking to replace cable. The Promotion is set to end on January 9th !

directvnow.com/

[The Virginian]

Have a Happy New Year with these Six Stocks !

VGR - 7.01% - Tobacco & Real Estate
OHI - 7.89% - Healthcare Facilities
T - 4.59% - Telecommunications & Entertainment
STWD - 8.71% - Diversified REIT
MAIN 6.03 % - Business Development Company
HTGC - 8.75% - Venture Capital Investment

Total Average Yield : 7.16%

$100,000 invested will bring in about $600 a month in Income !

In addition : Main usually pays a special dividend Every six months ( recently @.27 per share)  &
VGR pays a "Share Dividend" in September each year of 5%


Now that's one Happy New Year !

[The Virginian]

Why I Like REITS

REITS are Real Estate Investment Trusts - There are several types of REITs but the common factor is they all involve Real Estate.

REITS are mostly misunderstood in my opinion not only by Individuals but by "Professional investors" as well.

What makes a REIT ?

By Law they have to meet the following criteria :

They hold at least 75 percent of its total assets in real estate

Derive at least 75 percent of its gross income from rents from real property, interest on mortgages financing real property or from sales of real estate

They must pay out at least 90 percent of its taxable income in the form of shareholder dividends each year - This is why many REITS pay such high Dividends - They have to !

Must be a  taxable as a corporation

They have to be managed by  board of directors or trustees (Careful - Some are managed by "External Boards" - This is not always bad but in some cases it can present some serious Conflict of Interest )

Have a minimum of 100 shareholders ( Yes their can be Private REITS)

Have no more than 50 percent of its shares held by five or fewer individuals


Types of REITS - A quick search on the internet and all I could find was the recognition of 5 Main Types of REITS but the truth is there are perhaps dozens of differing types of REITS to invest in - which is great because it also provides for more choices and greater diversity within the REIT kingdom.

Some of the different types of REITS are :

Retail REITS - Invest  in Shopping Centers, Strip Malls, Outlet Stores and Mixed Use Communities - (Within this genre are NNN ( Triple Net Leases) - which are very stringent Leases they basically makes tenants pay for everything including maintenance, taxes, repairs , equipment replacement ........... these provide the most stability for the Landlords.

Residential REITS - Apartments, Condo developments, housing Rentals

Healthcare REITS - Nursing Homes , Assisted Living Facilities, Medical Offices, Hospitals and Outpatient Facilities

Office REITS - Office Buildings, Government Offices

Mortgage REITS - Invests in the underlying mortgages of various types of properties ( called  equity REITS ( actually own properties) or mREITS ( Own the Mortgages )

Industrial REITS - Invests in things like Warehouses and Industrial facilities and then leases them back to companies - Industrial Parks , or huge facilities like those for UPS, FEDex or Amazon .........

Land REITS - Invests in Land - Primarily for Farming and Agriculture - Buys the properties and then leases it to farmers

Storage REITS - Builds Storage Facilities and operates them

Data Center REITS - Builds huge Climate Controlled Data Centers and Leases them to Tech Companies for their Server operations.

Lodging REITS - Builds and Leases Hotels, Motels, and Travel Lodging Facilities - Leases them to the Franchisees and Hotel Operators

Specialty REITS - Infrastructure , Communications Towers, Casino Properties , Advertising Signage, Private Prisons  ........

[The Virginian]

Why I Like REITS
(Part 2 )

As you can see from the previous post REITS provide some great opportunities -

1. Payout 90% of Income by Law
   
2. Provide Diversification
   
3. Own Tangible Property Assets.
   

Before August of 2016 the Markets included REITS under Financials, which meant when purchased by ETFs, Mutual Funds they were lumped in with various other Financial assets and they had no dedicated percentage allotted to just REITS.  But starting September 1, 2016 REITS officially became their own asset class. In theory - as more REITS are added because of being their own asset class it should be a positive driver for them as a whole.

Most REITS pay Quarterly Dividends - but there are a few that pay their Dividends monthly. Now I must say I have read studies that prove there is very little advantage over the short and medium terms to a stock that pays monthly dividends versus quarterly dividends but - from my perspective ( I own a dozen monthly payers in my portfolios) it sure is great to be able to collect dividends on a monthly basis ! It allows me more flexibility with the dividends for cash flow, something that can be very important at times.

What is the return for REITS ?

REITS have been around since 1960

The 40 year rate of return ( as of 2014 ) was 12.83%

REITS protect from Inflation ?

Yes, better than many other asset classes because they contain real property assets they tend to increase in value as inflation rises which provides sort of an automated inflation protection.

Are REITS riskier because they pay higher dividends? The answer in my opinion is No. They have to pay out the higher rates because of the Law under which they operate. This why many investors look at their Payout ratios and PE ratios and balk at the thought of buying REITS - Look at Realty Income (O) for example -- according to FINVIZ - it's PE ratio is currently 52 ! And it's Payout Ratio is 213.40 % ! But with REITS these metrics are useless. Realty Income is considered the Rock of Gibraltar of REIT stocks.

That being said - Yes there are risks in REITS but just because they are payer higher Dividend rates does not mean they are necessarily riskier investments.

Which is better a Stock that pays 2% Dividend and has a DGR ( Dividend Growth Rate ) of 8% or a stock that pays 8% and has a Dividend Growth Rate of 2% ? Studies have shown it depends -- If you have a time horizon of say 15 years then you are better off with the stock paying 8% but if you are young and have a time horizon of say 25 years - then I would say take the 2% yield with the 8 % growth. In other words it will take 15 - 20 years for a low yielding stock to catch up with higher yielding stock with the higher DGR.

There are many great REIT stocks out there. Avoiding them because you have heard that they are "Risky" only serves to cheat yourself out of some very good returns. I encourage each and everyone of you to do your own homework and consider at least adding a couple of REITS to your portfolios.

One of my favorite authors is : Brad Thomas - He wrote a book called "The Intelligent REIT Investor" - It is a very worthwhile read.

[The Virginian]

Why I Like REITS
Part 3

Another thought on REITS - I used to Invest in Real Estate - at one time I owned 3 Rental Properties - I did very well in them, though all of them were not originally bought for Investment purposes. My first property was a Town-home that I had purchased , I was in the Military and when it came time to move the housing market in the late eighties had dropped out of site. If I sold it , I would have taken a huge loss, and to make things even worse, my mortgage loan rate was a whopping 11% ! ( Remember those days?) I tried to refinance but because my loan to value ratio was out of whack I would had to have come up with about $30,000 at the time to pay down my mortgage to refinance it. That was not an option for me. So I decided to rent it. It was tough because I was still losing about $250 each month between the rent and the mortgage payments. I stuck it out though and then met my future wife. She owned a Condo, and when she became pregnant we decided to purchase another home , and so we decided that her Condo would become a rental property. To make a long story short, we moved again and rented out our home so now we owned 4 homes with 3 of them rented out. In the end it worked out very well, we made loads of money off of them but the rental game is not for the weak. People not paying - They complain about the smallest of details ( I had one tenant that complained because she had to replace too many light bulbs and insisted that I pay for them) and they tend not to take care of a property as well as an owner would. It was rewarding but a lot of headaches. It seemed like we were continually buying new appliances , hot water heaters and was a serious drain on our cash flow at times - even though in the end we sold them for substantial profits.

Now to my point - REITS allow me to invest in Real Estate , have diversity, and avoid all the headaches associated without personally dealing with tenants. No problems with cash flows, no unexpected loss of income from tenants moving out in the middle of the night, no unexpected repairs or appliance replacements.
With REITs I feel like I get most of the benefits of Real Estate without most of the headaches.

[The Virginian]

REIT Suggestions :

O, DLR, VTR, HTA , STAG, GPT, ROIC, HCN, OHI, LXP, KIM, WPC, DOC, EXR, MYCC, TCO, SKT, UBA, STWD, CONE, BRX, CLDT, HST, APTS, FPI, CORR, NHI, CCP, CTRE, WPG, KRG, SNR, LADR, PEB, BXMT, IRM, CIO, LTC, DEA, NSA, HASI, VER, SRG, WSR, LAMR,


Bold - I own

Red - I would like to add in near future

[Deleted]

Timely post The Virginian, as of next week I won't have any real estate holdings so I am contemplating making the Vanguard REIT VGSLX 10% of my holdings.

[The Virginian]

Jan 2, 2017 15:20:31 GMT -5 @aj said:

Timely post The Virginian, as of next week I won't have any real estate holdings so I am contemplating making the Vanguard REIT VGSLX 10% of my holdings.

It is my personal belief that everyone should hold Real Estate in their portfolios - And REITs are the easiest way to do that. In fact ( Just my personal belief) the International Stocks and add REITS instead !

[The Virginian]

Armour Residential (ARR)  is Cutting its Dividend 13.6% !

From a Monthly rate of .22 to .19 per share.

As a result I am Selling this stock this morning !

 

[The Virginian]

Spectra Energy (SE) Raises its Dividend by 8.6% !

Spectra Energy has raised its Quarterly Dividend from .405 to .44 cents per share on a Quarterly basis !

On an annual basis from $ 1.62 to $1.76 per share.

[The Virginian]

Aug 20, 2016 6:30:11 GMT -5 The Virginian said:

Talk about bad timing !

The other day ( Thursday)  I bought a stock (GEO) --the order was filled @ about 11 AM
185 shares @ $31.32. I went to eat lunch came back to the computer - looked at the screen and GEO was down over $12 per share ! I didn't know what to think - I had just seen $2,500 disappear in a few minutes.
At this point I saw the news that the government was shutting down it's contracts with private prisons. But then the panic really started -

Do I sell and cut losses?
Do I buy more shares and lower my cost share?

I really did not know what the right move was - I searched everywhere for answers and direction. I even went to the companies website - ---- nothing !

I ended up deciding to wait it out over night and seeing what would happen the next day (Friday).
The futures were indicating a 12% rise in price so it calmed me a little and I have since decided to keep the stock for now and keep a close eye on it for direction.

This points out the dangers of investing - you never know when something is going to pop out of nowhere and bite you. But it also points out the value of spreading your investments over many stocks to limit these types of losses.

Wow what a week !

Hope you guys had a better one !

Thought I would give an  update on what was certainly the worst Investment I made last year. Well I didn't know what to do with the stock, but decided to hold onto GEO and take my chances. It paid off -- Not because of my knowing how to  handle it but because luck was with me. Now looking back I wish I had doubled down and bought even more shares but none of us has a crystal ball to see what the future may hold.

Anyway it worked out for me - my 185 shares that were worth $5,977.35 on the 18th when I purchased them are now at $36.48 and have a total value of $ 6,748.80 for a paper profit of $ 771.45 and along with the Dividend paid in November of $120.25 means I am up a grand total of $891.70.

I'm honestly confused as to what the  lesson is here  because  it could have gone the either  way.



Just goes to show that investing is not always a straight path and sometimes we just have to take a guess at which path to take. I just count my blessings that I chose the right path on this one.

PS: Anyone heard from Ombud ?

I hope she is okay - I haven't' seen her around for a while.

[ModE98]

Was wondering about her too.  She had not indicated any problem, but a sudden disappearance is troublesome, what happened

Picked a few lots of EPA, HTA, OHI  today to add to the port.

[The Virginian]

It says that Ombud was last online back in July - I certainly hope she is okay. 

[The Virginian]

Omega Health Investors (OHI) Raises it Dividend by 1.6% !

Omega Health Investors has once again raised its Dividend from .61 per share to .62 per share on a quarterly basis.

On a yearly basis from $2.44 to $2.48 per share !

OHI is one of the REIT Investments recommended above.
This will be the 18th consecutive quarter they have raised the dividend.

www.omegahealthcare.com/investor-relations/stock-information/dividends

[ModE98]

 Bought some OHI on Monday.  Glad I did.   Thanks for the good news!