It’s time for another dividend income report – mid summer edition! Thankfully, my Portfolio continues to collect strong dividend income (even though I was far from setting a record, like I did last month).
My Portfolio kicked off the 2nd half of 2024 with solid results. However, I actually posted my lowest monthly dividend total of the year. Hmm, a conflict seems to exist here. An explanation is coming.
I came up short of my monthly Year-over-Year (YoY) dividend growth target of 15%, but easily notched a double-digit percentage increase. Thus, not much to complain about here.
Dividend raises weren’t plentiful in July, but I did get a larger quantity than I was expecting, and this provided more additional forward dividend income than I thought I might get.
There were a typical amount of Portfolio transactions in July. However, no stocks joined or exited my Portfolio. I primarily worked on boosting my existing holdings, but there was one trim I’ll mention later.
Sadly, my annual forward dividend income sources (reinvested dividends, dividend raises, and investment of capital) didn’t provide a triple-digit total in July. However, this was mainly my fault – I’ll explain shortly.
Needless to say, I plan to share updated dividend progress charts later in this post (both monthly and annual). Those tend be be a nice visual, so keep reading to see those.
Let’s start July’s dividend report by examining this month’s dividend income…
Dividend Income
July isn’t one of my strongest dividend months, but my Portfolio did manage to rake in $1,409.71 in dividends. This means that every month in 2024 has delivered at least $1.4K, but my streak of 5 straight months topping $1.5K came to an end.
YoY growth was a solid 13.65%, which came up short of last month’s percentage increase, as well as the 15% number that I usually target. Despite this, a double-digit YoY growth percentage is always welcome.
A total of 23 companies paid me a dividend in July. Only two of those dividend payers provided a triple-digit dividend, but I do have three stocks knocking on the door of providing a $100+ dividend, two of which I think will be there by next quarter. My top dividend payer this month was Altria Group (MO), which paid me $147.10. The $119.55 from RPM International (RPM) was a distant 2nd.
My smallest dividend of the month came from The Walt Disney Co. (DIS) at $13.55. No surprise here given the low yield on DIS shares and the fact that this is my smallest Portfolio position.
The increased dividend amounts from OGE Energy (OGE), VICI Properties (VICI), Medtronic (MDT), Amdocs Ltd. (DOX), American Tower (AMT), Realty Income (O) and McCormick & Co. (MKC) were each helped by one or more purchases over the past year.
Increased YoY amounts for all other companies were a result of dividend increases and reinvested dividends over the past year. I added more than $15 in YoY dividend gains from JPMorgan Chase & Co. (JPM), nearly another $15 from MO, topped $12 from RPM, exceeded $10 from Automatic Data Processing (ADP), and almost added $8 each from Merck & Co. (MRK) and Illinois Tool Works (ITW).
Of the stocks that paid me in both July of last year and this year, none of them posted a payout reduction. Make that two consecutive months in a row for this benefit to YoY growth.
As for new July dividend payers, there were two for me. UGI Corp. (UGI) arrived with a solid $69.38 dividend, while DIS dropped that initial dividend of $13.55 that I noted earlier.
With regard to stocks that no longer pay me a dividend this July… two stocks met the criteria. My Portfolio had to make up for the loss of nearly equivalent dividends from Medical Properties Trust (MPW) and Best Buy (BBY). It was $50.51 from MPW and $47.08 from BBY that went by the wayside. I purged MPW from my Portfolio due to its horrible performance and shaky dividend. Meanwhile, BBY wasn’t in my doghouse, but I cut it loose since it wasn’t growing as I’d hoped and its dividend growth was waning.
Once again, the majority of my dividends got automatically reinvested into the stocks that paid them. However, there were a couple of exceptions. MO didn’t get reinvested by choice (I didn’t want to see this position grow any further), and DOX didn’t get reinvested since my broker doesn’t offer reinvestment for this particular company.
With regard to the reinvestment that did take place, it added $38.84 of additional forward dividend income to my Portfolio. This was the first time I hadn’t reached $40 due to reinvested dividends since February 2023. The upward trend in stock prices in the first half of 2024 has driven down yields and lessened the income from reinvestment. UGI added over $4 to this month’s additional forward dividend income total, while VICI tacked on another $3. Yet another 7 companies contributed more than $2.
As a result of reinvested dividends in July, I dripped over 17 new shares of stock. This included better than 3 new shares of UGI, and 2 new shares of VICI. Three other companies added 1+ shares, with RPM falling just shy of 1 new share.
Dividend Raises
For the month of July, dividend raises ended up being better than I expected. This wasn’t because I had a terrific boost from one of my companies either, it was because I received a couple more raises than I was expecting, and the fact that I didn’t have high hopes coming into the month.
As it was, I ended up with four dividends raises instead of the two I planned on. It seems these two additional raises just got pulled forward from August.
Unfortunately, none of the dividend increases were of the double-digit percentage variety. One topped 8%, but the others were all in the 2.5%-3.1% range.
I was hoping to see at least $10+ of additional forward dividend income from July raises. I exceeded that mark with the two raises I expected. The two unexpected raises then put me well beyond that target.
My first raise of the month was my best in terms of raise percentage. Cummins (CMI) delivered a solid 8.33% hike, which slightly exceeds their 1-yr, 3-yr & 5-yr averages. The raise also topped last year’s 7.01% increase, and resulted in $9.93 of forward dividend income.
The other expected July dividend raise came from NNN REIT (NNN). The 2.65% increase was on par with what I was expecting and it added $5.29 to my forward dividend income. The raise from NNN came up short of the 2.71% hike provided last year.
As for the unexpected raises, the first one came from Union Pacific (UNP). This was UNP’s first dividend raise in 26 months. I was thinking we might hear from UNP in August, but it came a bit earlier than anticipated. The hike was 3.08%, well below their 3-yr, 5-yr and 10-yr dividend growth rates, but after waiting for over two years, I was happy to get any bump. Since UNP is one of my bigger positions, the small raise still resulted in a decent $14.54 forward dividend income increase.
Near the end of the month came the second unexpected raise. It was Skyworks Solutions (SWKS) that announced a bit earlier than expected (August seems to be their usual month). The raise was well below their historical double-digit raise percentage though, at 2.94%… so, a surprise to be sure. This hike was nowhere near the 9.68% raise provided last year. However, my forward dividend income still increased $11.83 due to SWKS being one of my larger holdings.
After accounting for all my July dividend raises, my additional forward dividend income rose by $41.59. Not too bad considering I was only hoping to top $10 coming into the month.
I’d have to invest $1,551.87 at my Portfolio’s current yield of 2.68% in order to receive the same boost to my forward dividend income as this month’s raises.
Looking ahead to August, I am only expecting to have 2 dividend raises after SWKS and UNP announced in July, and Main Street Capital (MAIN) already chose to forego a hike. So, it’s only Illinois Tool Works (ITW) and Altria Group (MO) on my expected list. One of these two companies already announced their dividend raise in August, but I’ll save that for next month.
Dividends Due To New Investment
I made a total of 6 Portfolio transactions in July… the same number I made in June. Once again, I didn’t add any new stocks, or eliminate any existing ones.
There was one trim in the group, but the other transactions were buys. Essentially, I bolstered existing positions, including one position being added to twice.
Details about each of these moves can be found in the following pair of posts…
Recent Transactions – AVGO, NKE, SBUX, DIS
The set of transactions resulted in a net withdrawal of $1,039.35 from my Portfolio, as my lone sale was rather large, but the sum of the smaller adds didn’t offset it. I also realized a short-term capital gain of $19.91 with my one trim.
Sadly, my forward dividend income decreased by $5.06 as a result of the moves. My forward dividend income should recover once I get around to reinvesting all the sale proceeds from the AVGO trim.
With no stocks leaving or entering my Portfolio during the transactions, the number of stocks in my Portfolio still holds at 57.
Tallying Up The Additional Forward Dividend Income
In 2024, I continue tracking my additional forward dividend income generated each month from the trifecta of sources: reinvested dividends, dividend raises, and new capital investment.
I show 2023 totals as well, so that we can compare as the year progresses.
My string of 11 consecutive months reaching triple-digits for additional forward dividend income is over. The negative number I posted in Investment of Capital did me in.
That AVGO trim I mentioned earlier was fairly large and I never got around to reinvesting all the sale proceeds. Had I done that, I might be talking about a year’s worth of $100+ additions to my forward dividend income from the trifecta of sources. In the end, I added a total of $75.37 of additional forward dividend income. This was my worst monthly showing of 2024.
Dividend Raises led all my contribution sources with $41.59, despite me worrying that I might not see $10 in the category. It wasn’t a convincing win for Dividend Raises over Reinvested Dividends, but it got the job done.
The $38.84 provided by Reinvested Dividends was also my worst total of 2024 from that source. Elevated stock prices have brought yields down, leading to less impact when reinvesting dividends. Turning off a couple of my larger drips in recent months hasn’t helped either. The non-reinvestment of MO hurt my total in July.
My total amount for additional forward dividend income in July ($75.37) fell just shy of what I posted in July of last year ($81.58). Thus, I didn’t hurt myself too much in the quest to achieve my best year ever for additional forward dividend income. The $2,224.04 number from back in 2021 is still the number I’m hoping to surpass.
Progress Charts
The following are progress charts, also available on my Dividends page.
Even though I was able to top $1.4K in July, it’s clear that the first month of the 2nd half of the year is one of my weaker months for collecting dividend income.
On an annual basis, here’s what the dividend totals look like.
I’m well past $11K after 7 months in 2024. This nearly topped the entire dividend total I registered in 2020. The push for $20K by the end of the year is still on.
Summary
Even though I collected what turned out to be my lowest monthly dividend income total of the year, I still feel like I notched another good month in July.
That’s because I still raked in nearly $1,410 in dividends. In addition, while my YoY dividend income growth didn’t quite reach my 15% target, the 13.65% I did achieve is more than satisfying.
I had 23 dividend payers, but only 2 of them provided a triple-digit dividend, MO and RPM. However, 14 of my 23 payers delivered better than $50. I like the diversity.
Reinvested Dividends provided close to $39 of additional forward dividend income. The total could have been higher if earlier this year I hadn’t turned off the drip for this month’s top dividend payer, MO.
I tallied four Dividend Raise announcements in July, which was two more than expected. A couple of my August dividend payers were early with their raises. All the raises accounted for close to $42 of additional forward dividend income.
I made six Portfolio transactions in July, 1 sale (trim) and 5 buys (of existing holdings). However, I never reinvested all the sale proceeds from the trim, and thus I essentially made a net withdrawal from my Portfolio in July… a tad more than $1K. Also, my additional forward dividend income due to Investment of Capital declined by more than $5 in July. Lastly, of the 5 buys I made in July, two of them were of Nike (NKE). No stocks entered or exited my Portfolio during the month.
Tallying the contributions from all sources, I added better than $75 in additional forward dividend income to my Portfolio in July. This broke an 11-month streak of reaching $100. Yet, I remain on pace to deliver a record annual forward dividend income total in 2024.
How did you kick off the 2nd half of 2024 with respect to dividend income? Unlike me, is July one of your better dividend months, either from a dividend income or dividend raise perspective? Please share in the Comments!
I have updated the Portfolio & Dividends pages in conjunction with this monthly update.