It’s time for my final monthly dividend income report of 2021.  But first, let’s briefly talk about the entire year for my Portfolio.

It was a terrific year from a Portfolio perspective.  Portfolio return was around 24%, I met the majority of the Portfolio goals I laid out earlier in the year, and I surpassed the dividend income and forward dividend income targets I added a few months into the year.  More on this later.

Dividend raises were back in force in 2021, too, after a lackluster 2020 that was impacted by the start of the pandemic.  I outlined 2021 dividend increase percentages for my Portfolio holdings in a recent post called Dividend Raise Summary (2021).  If you haven’t checked that out, give it a look.  It will show plenty of terrific dividend raises received throughout the year.  I also received a monster special dividend from T. Rowe Price Group (TROW) in July.

OK, but what about December?  How did I finish out the year?

Well, it wasn’t record dividend income, but I recorded a significant total nonetheless.  I was well into the four-digit level.

YoY growth appeared to be a bit low, but it was actually much better than it looked.  I’ll discuss why that is coming up.

Dividend raises were once again stellar in December.  For the 2nd month in a row, I matched the largest number of raises I’ve ever had in a single month.  However, in December I posted more than a handful of double-digit raises.  Even better, the resulting boost to my forward dividend income due to raises in December was larger than that from last month (which was strong in its own right).

Portfolio transactions in December were limited to just one cluster of 4 moves near the end of the month.  I trimmed one stock and then added to three existing holdings.  There was a net cash investment and a small boost to forward dividend income.

I’ve got updated monthly income and annual income progress charts to share.  Both December’s progress and the annual progress for 2021 will be evident.

One bonus section I provide near the end of December’s monthly dividend income post is a check of the YoY growth of both my actual annual dividend income and my annual forward dividend income.  Let me say that results were looking good here.  Keep reading to find out how good.

There’s obviously plenty to cover, so let’s get to it… starting with December’s dividend income.

 

Dividend Income

 

In December, I collected a total of $1,417.23 in dividends.  This was my 3rd best monthly total ever.

YoY growth was less than I’d like to see at 6.29%, but it was impacted by last year’s Fastenal (FAST) special dividend.  If I back out that special dividend, then YoY growth would have been a more pleasing 17.25%.

A total of 22 companies paid me a dividend in December.  That’s great to see… however, the best part was the seven $100+ dividend payers this month.  I love seeing my dividend payers reach that triple-digit dividend payment amount.  Union Pacific (UNP) crossed that threshold for the first time for me after a surprise dividend raise in the first half of December.

Qualcomm (QCOM) led my dividend payers with a hefty dividend of $137.81, despite my trim last month.  Broadcom (AVGO) and TROW weren’t too far behind QCOM’s total.  I suspect both of these stocks will surpass my QCOM dividend in the quarters ahead given their stronger dividend growth rates.

My smallest dividend payment of $5.83 was from NextEra Energy (NEE), although the $6.90 from Microsoft (MSFT) wasn’t much bigger.  I’d like to see each of these dividends be greater in size, but both stocks look so overvalued at current levels that I don’t see purchasing either anytime soon, and thus I don’t see their dividends changing significantly in the near-term.

The increased dividend amounts from Gilead Sciences (GILD), UnitedHealth Group (UNH), Visa (V) and Realty Income (O) were helped by additional purchases over the past year.

The dividend bump for Main Street Capital (MAIN) was primarily the result of a small $0.10/share special dividend delivered in December.  It put an extra $14.76 in my dividend stocking.

Increased YoY amounts for the other companies were a result of dividend increases and reinvested dividends over the past year.  I totaled over $25 in YoY dividend gains from TROW, over $20 from AVGO, better than $19 from UNP, over $17 from Aflac (AFL) and over $14 from BlackRock (BLK).  That’s some impressive YoY growth.

The YoY dividend growth from QCOM and Skyworks Solutions (SWKS) was small due to trims that I’ve made in each over the past year.

Only one stock posted a payout reduction compared to last December.  That stock was 3M Co. (MMM).  I trimmed MMM this past May as I tried to lighten up my Industrials weighting.  My disappointment with 3M’s dividend growth over the past two years was a contributing factor in the trim as well.

I had 4 new dividend payers show up in my Portfolio in December.  Dividends from Lockheed Martin (LMT) and Amgen (AMGN) were similar in size and led the way.  A pair of Utilities in Pinnacle West Capital (PNW) and NEE rounded out the new contributors.

I also had a pair of dividend payers disappear this December compared to last year.  The absent dividend from FAST was just the result of no special dividend being provided this year, so nothing to worry about on this one.  As for the missing TCF Financial (TCF) payment, that disappeared when I sold my TCF position just prior to the Huntington Bancshares (HBAN) acquisition.

As usual, all my dividends got automatically reinvested into the stocks that paid them.  The additional forward dividend income boost that resulted from the reinvestment was $35.13.

With all the reinvested dividends from December, I purchased almost 11 new shares of stock.  This included over 1 share each of AFL, GILD, Walgreens Boots Alliance (WBA) & MAIN.

 

Dividend Raises

It was another glorious month of dividend raises in December for my Portfolio.  I received all the raises I expected, plus two surprises… love those.  It was 8 raises altogether.

I came close to notching my best month of the year with regard to increasing my forward dividend income due to raises, but came up a bit short.  Still, it was my 2nd best month of the year.

The highlight of the month though was the following.  If I take out the two expected, small, quarterly dividend raises I received from O and W.P. Carey (WPC), then all the remaining stocks raised their dividend by at least 10%.  Double-digits all around!

My first raise announcement arrived on the 2nd day of the month.  It was a 10.14% raise from Eastman Chemical (EMN).  This was more than double last year’s boost of 4.55%.

The very next day Amgen delivered a 10.23% raise.  This was on par with the 10% increase from last year.

WPC provided a 0.29% bump this quarter.  This was actually a step up from the 0.19% boost it had been providing for the last several quarters.  Could this be the start of better raises from WPC?  I sure hope so, because I’ve been disappointed with the slowing dividend growth from WPC the past several years.

Thankfully, the very next day (the 9th), I got the first surprise of the month… let’s call it an early Christmas present.  After years of no dividend growth, CVS Health (CVS) boosted its dividend by 10%.  The last raise prior to this one came 5 years ago, at the end of 2016.  I figured it might be another year of deleveraging the Aetna acquisition before CVS provided a dividend raise, but that was not the case.  Needless to say, I was excited to learn about the extra income I’ll be receiving from CVS in 2022.

Also announced on the 9th was my biggest raise of the month.  It was the largest in percentage terms and with regard to providing the biggest boost to my forward dividend income.  It was a 13.89% increase from AVGO that added $66.07.  Awesome!  This year’s raise bested the 10.77% one from last year.

On the 10th, I received my 2nd surprise of December.  It was a 10.28% dividend raise from UNP.  This was UNP’s 2nd raise of 2021.  The first was a 10.31% boost from this past May.  This sure makes up for the lack of any dividend raise in 2020.

Keeping up the momentum, Bristol-Myers Squibb (BMY) announced a 10.2% raise three days later.  This was a nice tick up from last year’s 8.89% boost.  The past 3 annual raises from BMY have been quite nice, especially after more than a decade of increases in the 2.5% to 3.25% range in the preceding years.

Lastly, O delivered its usual 0.20% quarterly raise.  I have to say it was a bit unexpected given that O just provided its big annual raise just last month.

 

 

Adding up all the dividend raises from December, my forward dividend income increased by $177.97.  This was nearly $6 better than the wonderful amount I secured in November, and only about $3 shy of my best total of the year, which I posted in January.

I’d have to invest $7,980.72 at my Portfolio’s current average yield of 2.23% in order to receive the same boost to my forward dividend income as this month’s raises.  Just to give this number some perspective, my new capital investment in each of the past few years has been about $10K.  Thus, my dividend raises from December alone provided about 80% of the forward dividend income that I gain from a year’s worth of new capital investment.  Wow!

Looking ahead to January, I’m expecting at least 5 more dividend raises, all in the latter half of the month.  I expect to hear FAST, BLK, Nexstar Media Group (NXST), Comcast (CMCSA) and Air Products & Chemicals (APD).  It’s possible that a dividend raise from Quest Diagnostics (DGX) arrives late in January, but I’m guessing it arrives in early February instead, just like last year.  It should be a terrific start to 2022 with these dividend raises on tap.

 

Dividends Due To New Investment

Transaction activity was light in December.  Yet, I still managed to execute a few trades – 4 trades to be exact.

I trimmed my Gilead Sciences (GILD) position due to lackluster performance over the past few years, as well as declining dividend growth.

Those sale proceeds were then invested in more shares of PNW and AMGN.  This recouped the dividend income lost in the GILD trim.

Lastly, I took some new capital and invested it into additional shares of BMY.  I invested the cash in order to hit my new capital investment goal for 2021.

So, the 4 trades were comprised of 1 sale and 3 subsequent purchases of existing holdings.  The details for these 4 transactions can be found in the following post…

 

Recent Transactions – GILD, PNW, AMGN, BMY

 

The transactions resulted in a net investment of $563.72.  Certainly not a huge investment, but it keeps the Portfolio growing.  My forward dividend income increased by $21.24.

With the sale being only a trim, and the purchased stocks being existing holdings, the number of stocks in my Portfolio remained at 55.

 

Tallying Up The Additional Forward Dividend Income

In 2021, I’ve continued tracking my additional forward dividend income generated each month from the trifecta of sources: reinvested dividends, dividend raises, and new capital investment.

I showed 2020’s totals, too, so that we could compare as the year progresses.  Now that we’ve closed the book on 2021, we can see not only what totals I managed in December, but for the entire year as well.  I added nearly $1K more than I had in 2020.  What a year!

 

 

My additional forward dividend income for December came in at $234.34 (my 3rd best monthly total during the year).  Most of this came from Dividend Raises, as is usually the case.

Reinvested Dividends was my next highest amount for the month at $35.13, with Investment of Capital bringing up the rear by contributing $21.24.

I notched another triple-digit monthly total in December, meaning that I posted $100+ in additional forward dividend income every month in 2021… quite the achievement for me.

For the entire year…

Recall that I was targeting $1K from Dividend Raises for the year.  I actually reached this in November.  After adding in the strong December amount, my annual total came in at just over $1.2K.  Here I was trying to reach $1K just a couple of months ago and the last two months had such impressive dividend raises that I ended up over $1.2K… talk about exceeding expectations!

Reinvested Dividends finished with $373.96 for the year.  This was below the total from 2020 (despite more reinvestment this year) due to reinvesting at higher prices relative to last year.

The annual total for Investment of Capital settled at $646.82.  This was more than double the total from 2020, even though I invested about the same amount ($10K).  I had a few strategic swaps this year that really boosted my 2021 total.

For the entire year, I recorded $2,224.04 in additional forward dividend income when accounting for all three contributing categories.  This surpassed my previous best total of $1,958.60 set back in 2018.

 

Progress Charts

The following are progress charts, also available on my Dividends page.  I had higher dividend totals every month this year… just the way I like it.  I look forward to seeing what I can accomplish in 2022.

 

 

 

On an annual basis, here’s what the dividend totals look like.  That’s a nice little stair step pattern I’ve got going.  I plan to keep climbing in 2022.  Another adjustment to the Y-axis is coming!

 

 

Annual Growth

With the close of 2021, let’s take a look at the YoY growth of my actual dividend income, as well as my forward dividend income.

Actual Dividend Income

The annual numbers for actual dividend income can be seen in the chart just above.  I finished 2020 with $11,634.54 in dividends, while I finished 2021 with $13,466.05 in dividends.  YoY growth for 2021 thus totaled 15.74%, just shy of the 15.77% growth from last year.  That’s not much of a drop off in YoY growth.  Since I was working with a larger starting number in 2021 compared to 2020, the income delta turned out to be much better for 2021, despite the close YoY growth numbers.  In general, future years will see the YoY growth trend downward as the dividend numbers get larger.  It would be outstanding if I can stay above 15% YoY growth for one more year.

Forward Dividend Income

Let’s now examine my annual forward dividend income numbers.  I finished 2020 with $12,036.14 in forward dividend income (over $1K/month!), while I finished 2021 with $14,261.70 in forward dividend income.  YoY growth in 2021 forward dividend income was 18.49% compared to YoY growth of 11.40% last year.  I told you it was a good year!  This should lead to good YoY growth in actual dividend income in 2022.

 

Summary

For my Portfolio, December provided a terrific close to a stellar year.

In December, I raked in more than $1.4K in dividends.  YoY growth looked muted at almost 6.3%, but if I remove the effects of the FAST special dividend from Dec. 2020, YoY growth was over 17%.  That’s a number I can get behind.

Reinvesting all my dividends (as usual) led to just over $35 of additional forward dividend income.

I had 8 Portfolio stocks announce dividend raises in December (same as last month).  Six of the eight raises were north of 10%… impressive!  All totaled, the 8 raises added nearly $178 to my forward dividend income.

Portfolio transactions in December were contained to one group of transactions late in the month (three purchases & one trim).  My total cash investment was close to $564 which boosted my forward dividend income by a little over $21.

Tallying the contributions from all sources, I recorded north of $234 in additional forward dividend income for my Portfolio.  My Portfolio’s annual forward dividend income total rests at $14,261.70 as we head into 2022.

With regard to annual totals, YoY growth of actual dividend income was better than 15.7%, while the YoY growth of the forward dividend income was nearly 18.5%.

 

How did 2021 treat your portfolio?  What stands out when you look at your numbers?…  The annual dividend totals?  YoY growth in portfolio value?  Dividend growth?  Please share in the Comments!

I have updated the Portfolio & Dividends pages in conjunction with this monthly update.