Hey everyone! I’ve got 3 new buys to cover from the first half of August.
Two of the stocks have had recent price dips which led me to build out the positions, and the third stock I haven’t purchased in over 11 years.
All three stocks I bought already existed within my Portfolio. Thus, I remained focused on enhancing my current positions.
Let’s check out the purchase details…
Verizon (VZ)
I only established a position in VZ this past March. Since then the price has only declined. The price really took a dive in late July when VZ slashed its outlook as part of its latest earning report.
VZ is now trading at its lowest P/E ratio in the last 20 years (~8.6 times this year’s earnings estimate). So, I decided to average down my cost basis while building out my position a bit further.
On 8/5/22, I bought 10 shares of VZ at $44.75/share, for a total of $447.50. This was a 16.3% increase in the size of my position.
The stock yielded a hefty 5.72% at my purchase price (easily more than double my current Portfolio average of 2.58%).
I now own 71.251 VZ shares. The purchase lowered my VZ cost basis to $49.52/share.
This purchase increased my annual forward dividend income by $25.60.
In terms of my Portfolio value for VZ, it’s trying to break out of my bottom 10, but just barely remains there. It stands as the 10th smallest position in my Portfolio of 58 stocks. The stock is behind Amdocs Ltd. (DOX), but ahead of The Walt Disney Co. (DIS).
Medical Properties Trust (MPW)
Here’s a stock that’s been a part of my Portfolio a little longer… for almost a year now… since last September.
Apparently I was premature in initiating a position, as I bought north of $20/share at the time. I bought enough shares during that initial purchase that I wasn’t planning to add to my MPW position again.
For most of the past couple of months though, the stock has been trading in the $15-$16 range. The price dropped so much relative to my cost basis that I decided to bring that basis down by purchasing a few shares.
On 8/5/22, I added 25 shares of MPW to my holdings at $15.70/share, for a total of $392.50. This was a 17.7% increase in the size of my position.
The stock yielded a whopping 7.39% at my purchase price (approaching triple my current Portfolio average).
I now own 165.952 shares of MPW. The purchase drove my MPW cost basis below the $20 threshold, to $19.92/share.
This purchase also boosted my annual forward dividend income by $29.00.
MPW also resides in the bottom 10 of my Portfolio. It’s currently my 8th smallest holding. It stands behind DIS, but a good distance ahead of Cummins (CMI).
Johnson & Johnson (JNJ)
One of my legacy holdings is JNJ. This was easily one of my largest holdings when I started my dividend Portfolio in 2015.
With the position at that time being so big relative to my new holdings, I hadn’t felt the need to keep adding to JNJ.
However, over the past few years, several stocks in my Portfolio have overtaken JNJ, knocking it out of my Top 10.
As it turns out, my last JNJ purchase was way back in May, 2011. So, you could say I’m overdue to add a few shares.
The current valuation for JNJ is fair, but considering the premium JNJ often trades for it seems like a decent time to add.
Another reason to add? Well, like my Visa (V) position that I’m trying to get to 100 shares, I’d like to do the same with JNJ. I’m a little closer with JNJ as you’ll see.
On 8/11/22, I added 2 shares of JNJ at $167.75/share, for a total of $335.50. This was a small 2.05% increase in the size of my position.
The stock yielded 2.69% at my purchase price (slightly better than my current Portfolio average).
I now own 99.77 shares of JNJ. I should cross 100 shares with my dividend reinvestment next month. Sweet!
The purchase resulted in my JNJ cost basis rising to $72.82/share. It also boosted my annual forward dividend income by $9.04.
In my Portfolio value rankings, JNJ is still outside my Top 10, holding the 15th largest position. It’s sandwiched in between T. Rowe Price Group (TROW) and Nike (NKE).
Summary
I added shares to 3 of my existing Portfolio holdings during the first half of August.
The investments were fairly equal in size, but VZ got the most, followed by MPW, and lastly JNJ. My JNJ add was the first new purchase of that stock in over 11 years!
The set of three purchases resulted in a net investment of $1,175.50 into my Portfolio, advancing my forward dividend income by $63.64. The effective yield of this group of buys was 5.41%.
Have you added shares of any of these 3 stocks in recent weeks? Which do you like best at current prices? Please share in the comments!
Nice buys ED! You locked in some nice yields! 🙂
I own all three stocks. I am liking JNJ and want to add more to my position. My MPW position is pretty large so I will hold off on that. VZ is another stock I would be willing to add on too.
Thanks, MDD. Hopefully, we’ll see a rebound in their stock prices in the coming months. You do have a fairly large MPW position, so I can understand holding off on adding more.
Funny enough VZ and MPW are both sitting near the top of my list for higher yielders along with MO and BTI. I had been focused a bit more on building up BLK, ADI, CMI, and ITW which are newer additions to the portfolio but after the rebound since mid-June they don’t look quite as good for a value/yield standpoint. It wasn’t long ago I was buying BLK w/ over a 3.0% and up to 3.3% yield and now it’s down to around 2.6%.
With your goal to get positions up to 100 shares is that more just to have it or do you plan to start selling covered calls? I’ve been selectively selling calls around a couple positions but haven’t bee too aggressive with it.
I like all your choices with regard to the positions you want to build up, JC. I own BLK, CMI and ITW. Of the three, right now I’d like to build up my CMI position the most, but I’m holding off as it approaches $230. If it could drop below $200 again I’d find a way to buy some additional shares.
Driving to 100 shares is more about just having a nice round lot. However, being able to sell a covered call is a great option to have. It’s been a while since I sold a covered call in my Portfolio, but I won’t rule it out in the future. I like using the covered call the most when I’m already looking to sell the shares anyway.
Hello I enjoy reading all your articles. I own two out of the three you own Currenty own 2,300 shares of Verizon(DRIP) all the way and second is Johnson and Johnson. Currently owning 200 shares of JNJ. Both are a buy and hold forever stocks. VZ ia also in my retirement account. Thank you for all your articles and have a great day! Joseph
Hi Joseph. I’ve first got to say… Thanks for reading all my articles.
Wow, that’s a monster VZ position. It seems to dwarf your 2nd largest position (JNJ) by a good amount.
I’m surprised at the price drop in VZ lately. The sentiment is decidedly negative. I could afford to add a bit more VZ, but I don’t know that I will.
Good morning. Yes,my VZ position is a monster. Eventually I will trim it in my taxable account. I’ve been dripping for years and accumulated too many shares. At these prices I will. continue to drip.