I made a couple of transactions last week and wanted to report on them before any more time slipped away.  It was one sale and one purchase.

The sale was probably overdue.  The stock has been on my short list for sale for a few months now, but I never pulled the trigger.  After a recent upgrade for the stock, the price recovered enough for me to execute the sale, and the stock subsequently exited my Portfolio.

Meanwhile, with the purchase, I continued to build a relatively new position.  The position is growing nicely.  I’ve got room for additional purchases, too, but eventually I’d like to have the stock price stop drifting lower.

The stock I sold suspended their dividend back in May, so the sale didn’t impact my forward dividend income, which was good.  However, the stock purchase of course boosted my forward dividend income.  So happily, it was a net increase to my forward dividend income.  Sadly, this only puts a small dent in the dividend income hit I recently suffered at the hands of Wells Fargo & Co. (WFC).

Let’s get some details on this pair of transactions…

 

Kontoor Brands (KTB)

KTB was the smallest position in my Portfolio by value, by far.  The small position was the result of the spinoff from VF Corp (VFC) back in May 2019.

Couple its small position in my Portfolio with its suspended dividend and some significant debt to manage in the midst of a pandemic, and there’s not a lot to get excited about right now.

I’ve talked over the past few months about either making KTB a larger position in my Portfolio, or selling the few shares I had and moving on.  Well, we have that answer.

On 7/27/20, I sold all 11.361 shares at $20.00/sh.  After the SEC fee, the sale proceeds were $227.21.

The sale resulted in a long-term capital loss of $23.53, and a short-term capital loss of $5.19.

As previously noted, there was no reduction in annual forward dividend income that occurred with the sale, as the dividend was suspended last quarter, and the income loss was accounted for at that time.

 

Automatic Data Processing (ADP)

This is now my 8th purchase of ADP since I initiated my position back in late February of this year.  With all the job losses due to the pandemic, ADP’s business has been impacted.

Still, I’m a believer in the company in the long-term, and I’ve been doing my best to accumulate shares during their pullback.

The stock took another decent dip this week on the heels their earnings report, and this led me to add a few more shares.

On 7/29/20, I purchased 5 shares of ADP at $136.7167/sh., for a total of $683.58.  My ADP share total has risen to 50.49 shares.

The stock yielded 2.66% at my purchase price.  This is quite close to my current average Portfolio yield of 2.73%.

This purchase resulted in the addition of $18.20 in annual forward dividend income.

With this purchase, my ADP position is now the 29th largest in my Portfolio, right behind Texas Instruments (TXN) and just ahead of JPMorgan Chase & Co. (JPM).  Since ADP keeps falling in price, my purchases aren’t helping ADP move up my Portfolio rankings, but rather just help it maintain its existing position.

Should the stock fall below $130 level, I’ll consider another addition.

 

Summary

A couple of transactions showed up on my Portfolio register in late July… one sale and one purchase.

After its recent dividend suspension soured my taste for the stock, a poor near-term outlook for KTB was the final element that factored into its sale.

Those KTB sale proceeds and some new capital allowed me to add some more ADP shares and continue to build that position.

The result of the two transactions was a net investment into my Portfolio of $456.37, and an increase in my annual forward dividend income of $18.20.

I also registered a total capital loss of $28.72 with the KTB sale.

With the elimination of the KTB position, the number of stocks in my Portfolio fell to 49.

 

Have you eliminated any positions from your portfolio in the past few weeks?  What was the catalyst for your sale?  Please share in the comments!