The stock market responded well after the U.S. presidential election. It then pulled back some, before continuing to push higher. In the end, November was another successful month for my dividend Portfolio, as its value climbed and the dividends continued to roll in. Unless December unveils a major retreat for stocks, 2024 should end up being an excellent year for my Portfolio, even if it didn’t keep pace with the S&P 500.
Year-to-Date (YTD) the S&P 500 is up just over 28% with dividends reinvested. Financials had a strong month of November (up almost 11%) and now pace the gains for all S&P 500 sectors, up more than 36% for the year. The Information Technology, Communication Services and Utilities sectors are trying to keep pace… each are up more than 30% on the year, too.
Amazingly, all S&P 500 sectors, except one, have posted YTD gains of better than 10% through the end of November. Healthcare, after posting a negative return in November, is the lagging sector for the year, with a gain of only 7.76%.
I’ve got some money to invest before the end of the year to meet my annual investment goal. I’ll be looking over my other goals, too, to see if there’s anything I can do to make them successful. Also, there are a few Portfolio stocks that are shy of my 0.5% target weighting that I’m hoping to get all holdings to by year’s end. I’m not sure I’ll make it, but even one less stock below a 0.5% weighting is progress in the right direction.
As usual, in my Portfolio Thoughts post I’ll be discussing the following items…
- Price Movement – I’ll look at my top advancers and decliners in my Portfolio during the past month.
- Top 10 Review – I’ll update my Top 10 Portfolios stocks and how they changed rank this past month.
- Weightings – I’ll examine the sector weightings within my Portfolio and let you know where I’ve made progress with regard to getting into my preferred weighting ranges.
- Watch List – I’ll share which stocks I’m looking at as I prepare to invest my capital in the coming months.
Let’s get to my Portfolio Thoughts for November 2024…
Price Movement
Note – my price changes cover closing prices from 10/25/24 to 11/25/24.
November was a quality month with regard to the ratio of my stock gains to stock declines. The ratio pushed toward 2:1, but fell short. While there were quite a few negative moves of 5% or more, all of the biggest moves (double-digit percentage ones) were on the side of the gainers, and this led to a month comfortably in the green.
Of my 58 holdings, 37 gained in price while 21 declined. As you’ll soon see, the most significant gainers were not challenged by any comparable decliners.
Here were the stocks with the biggest moves to the upside and downside…
Of my 37 stocks that rose in price, one stock was able to post a gain north of 20%. Another 9 stocks had better than a 10% move to the upside (the usual threshold I monitor for). On top of that, there were another 16 stocks that advanced more than 5%. All totaled, that’s 26 of the 37 gainers adding 5% or more. Strong gains in November… I like it!
My top gainers for November were:
- The Walt Disney Co. (DIS), surging 22.07%
- UGI Corp. (UGI), escalating 19.08%
- Altria Group (MO), jumping 14.16%
- Cummins (CMI), popping an even 14%
- Bristol-Myers Squibb (BMY), rising 13.21%
There were no carryover stocks from last month… it’s a totally new set of stocks gracing the top gainers list this month.
Also, each stock in the top gainers list this month is from a different sector… that doesn’t happen too often.
The top gainer in November was DIS. Strong earnings, including a profit from its streaming business, excited investors and accounted for roughly half of its monthly gain in one day.
Another stock gaining after an earnings release was UGI, my 2nd best gainer for the month. UGI had been trading sideways for over a year, so it was nice to see this stock breakout.
MO has been riding bullish momentum ever since its earnings report was released at the end of October. I’ve been hoping MO would rise in price and hit $58 so that I could trim a bit. We’ll see what happens.
Popping nearly 9% on its earnings early in November was CMI. The stock has since risen another 5%. CMI has now posted gains for 5 consecutive months, moving its stock price up about $100/share in that time.
My last top gainer was BMY. The stock had a couple of events that helped it make my top gainers list in November. First, earnings in late October (accompanied by raised guidance) led to one jump. Then a couple of weeks later, an even better jump in price occurred when competitor AbbVie (ABBV) reported a disappointing schizophrenia-drug trial. That’s now 3 straight months of gains for BMY… hallelujah.
Note – four sectors in my Portfolio had all of their holdings in the green this month: Financials (6), Materials (3), Consumer Discretionary (3) and Energy (2). Communication Services (5) narrowly missed out on joining the party with one stock negative by a fraction of a percentage point.
Of my 21 stocks that fell in price, none posted a loss of more than 8%. However, I did have 12 stocks that fell at least 5%. This was a fairly significant number of impactful decliners, but thankfully they were offset by more than enough gainers.
My worst decliners in November were…
- Skyworks Solutions (SWKS), dropping 7.64%
- Amgen (AMGN), retreating 7.25%
- Lockheed Martin (LMT), sliding 7.18%
- General Dynamics (GD), falling an even 7%
- American Tower (AMT), declining 6.84%
Here, too, there were no carryover stocks from last month… it’s a totally new set of stocks on the top decliners list this month. Interestingly, the top decliners all fell about the same amount. It was a tight bunch in terms of loss percentage, for sure.
However, there are a couple of stocks from the same sector in this group… two Industrials stocks, LMT and GD. The upcoming 2nd Trump presidency seems to have investors a bit worried about what will happen with defense contractors. Gains from the past 4-6 months were given up by these stocks in November.
The top decliner for me in November was SWKS. Earnings were OK, but the weak guidance offered with its earnings report did the stock in. Some investors are worried about the dependence SWKS has on Apple (AAPL). This is now 4 consecutive months of price declines for SWKS. It’s been a rough year, and after this month’s retreat, SWKS is sitting near a 52-week low.
AMGN had a couple of negative news nuggets about its weight loss drug MariTide during November. This sunk the stock some on each occasion. Make it 4 straight months with a decline for AMGN. This month’s losses have almost brought AMGN back to breakeven for 2024.
Lastly, there’s AMT. This was not only one of my top decliners, but it was my worst-performing REIT, too. Most REIT stocks didn’t fare well in November. This stock retreated post-election, but has been recovering since.
Note – no sectors in my Portfolio had all their holdings in the red this month. That’s always a nice thing. Real Estate (4) came close, but one stock VICI Properties (VICI) helped it escape after posting a small gain.
Top 10 Review
For a 2nd straight month, all 10 stocks in the Top 10 remained the same. This hasn’t happened for a while.
Also, 5 of the Top 10 changed places in the rankings. The majority of the movers only moved one spot in the ranking, but there was one big mover up, and one big mover down.
The top 2 stocks, Broadcom (AVGO) and Aflac (AFL), held their positions relative to last month. Even though AVGO lost a good chunk of its Portfolio weighting due to a nearly 5% loss in November, it remained the no-doubt leader in my rankings. AFL used a better than 3% gain to hold on to the #2 spot.
With a gain over 9% in November, RPM International (RPM) climbed a spot in the rankings to grab the #3 position, overtaking Qualcomm (QCOM), which declined nearly 7% to fall to #4.
Financials was the best-performing sector in my Portfolio this month. While Visa (V) wasn’t the best of my Financials, it was second-best, recording a better than 11% gain this month. That allowed the stock to vault 3 positions higher in my rankings and lay claim to the #5 spot. V was my biggest mover to the upside this month.
Holding steady in the #6 and #7 spots, respectively, were BlackRock (BLK) and Lowe’s Companies (LOW). BLK gained close to 6% this month, while LOW managed almost a 3% advance.
Rising one spot in the rankings was Fastenal (FAST). A gain of more than 10% this month helped FAST move up.
My biggest decliner in the rankings was AbbVie (ABBV). It fell 4 positions to settle in the #9 spot. This is a big move for one month, and its nearly 6% decline in November didn’t seem to justify such a big drop, but there was a cluster of stocks in the Top 10 with similar weightings going into the month.
Staying in the #10 spot was Procter & Gamble (PG). PG gained over 5% in November, but it wasn’t enough to move up in the rankings. However, it did firm up its position in the Top 10, maintaining its sizable lead over other pursuers.
Lurking outside the Top 10, but with some work to do to make it in, are Union Pacific (UNP) and JPMorgan Chase & Co. (JPM).
From the table above, my Top 10 holdings now comprise 40.28% of my Portfolio value. This is a decrease of 0.22 percentage points compared to last month. For a 2nd straight month, 7 of my Top 10 stocks finished in the green, but this was not enough to grow the Top 10 weighting. The poor returns for AVGO, QCOM and ABBV in November were too big of a drag.
As for the dividend weighting of my Top 10, it finished the month at 29.07%. This is an increase of 0.17 percentage points compared to last month. The increase was due to the dividend raises from ABBV and V in late October. The dividend weighting of the other 8 stocks dropped marginally as other raises, and my new capital investment dollars, showed up outside the Top 10.
Weightings
In general, for the Sector Diversification, I target being within +/-3 percentage points of the sector weightings of the S&P 500. For the SuperSector Diversification, I target being within +/-5 percentage points.
The “Weight Diff.” column shows which sectors sit outside my preferred weighting ranges. If I’m overweight a sector, it’s shaded green. If I’m underweight a sector, it’s shaded red. If I’m within my target weighting range, then no shading exists.
I still have the same 4 overweight sectors as I had last month. Each sector got more overweight, as the weighting difference increased. In the case of Financials and Industrials, my Portfolio sector performance was better than that of the corresponding S&P 500 sector. When it came to Healthcare, my sector losses were smaller than those of the same S&P 500 sector. With respect to Materials, my Portfolio had an increase in that sector, while the S&P 500 sector weighting decreased.
As for my underweight sectors, I still have two. In the case of Information Technology, my losses in the sector were worse than those of the corresponding S&P 500 sector. When in came to the Consumer Discretionary sector, my Portfolio only had a marginal gain, while the S&P 500 sector gained weighting noticeably.
For my December investment dollars, I’ll try to put them into the 4 sectors that currently have a negative weighting difference: Communication Services, Consumer Discretionary, Energy or Information Technology. Of those 4 sectors, Consumer Discretionary and Information Technology will be given investment preference since I’m also outside my preferred weighting range in those sectors as well.
The big news when it comes to my sector weightings is that Financials had such a good month (and Information Technology did not) that Financials is now my largest sector, at almost 18%.
Healthcare remained my sector with the largest dividend weighting.
As always, I’ll keep all my sector weightings in mind as I continue to adjust my Portfolio, and my watchlist.
Watch List
For a 2nd consecutive month, my only Portfolio transaction was a purchase of Hershey Co. (HSY). This stock has been on my watchlist each of the past two months as well. Thus, my watchlist continues to be a ready source of stock ideas for me. I’ve got some investing to do in December to meet my annual investment goal, thus the watchlist will certainly remain relevant.
Let’s see what’s on my radar this month…
Within my Portfolio, here are a few stocks that I’m watching for possible additions…
Can I make it 3 months in a row for buying HSY? I’d be inclined to add below my last purchase price of $172.
Fellow Consumer Staples stock McCormick & Co. (MKC) remains on my watchlist from last month, too. This is my smallest holding and it needs to grow in size. The stock is still trading around $78 and I’m looking for a price below $75 before adding more.
My 2nd smallest stock, NNN REIT (NNN) needs to get larger as well. I’m looking to buy 10 shares at a price below $41.38. This would lower my cost basis while bringing my share total above 100 shares. It would also get me to that minimum 0.5% Portfolio weighting I’m looking for.
Nike (NKE) was last trading just below $79. I’d like to add more below $73, but I may not get a chance, as that’s a decent downside move.
After being on my watchlist last month, and being my top decliner in November, I should like Skyworks Solutions (SWKS) even more now. I think I do. I’ll target another dip below $83 to add more and lower my cost basis.
Staying in Tech, I’m still looking for Microsoft (MSFT) to dip below $400. If it does, I’d like to grow the position, adding to my Information Technology holdings, but diversifying away from my semiconductors just a bit, which make up a significant percentage of my Tech holdings.
I’m still open to selling my Bristol-Myers Squibb (BMY) and/or CVS Health (CVS) positions. Reducing my Healthcare holdings will help address my Portfolio being overweight in that sector. If I do sell or trim my BMY or CVS positions, I might keep some of that money in Healthcare by adding to my Medtronic (MDT) position. Adding MDT south of $85 would allow me to lower my cost basis in the stock.
As for non-Portfolio stocks that I’m watching…
Researching Concentrix (CNXC) is something I still want to do. Until then, no position will get opened, but it will remain on my watchlist. Right now the stock is trading around $45, but it sank to about $37 in mid November.
Dolby Laboratories (DLB) almost dipped below my target $70 level, but then it released its earnings and shot up from $71 to $82. The price has drifted back to around $77, but my $70 target remains in place.
In Communication Services, I’m eyeballing Alphabet (GOOGL) and Meta Platforms (META) as possible replacements (in part or in full) for Omnicom Group (OMC). OMC hasn’t raised its dividend in nearly 4 years and I want to have all my Portfolio holdings raise on an annual basis. I’ll target GOOGL below $170 and META below $525.
Elevance Health (ELV) is looking interesting in the Healthcare sector, even at the current level of $407. Initiating below $400 would be nice. Since I’m overweight in that sector it won’t be my first choice, but perhaps it’s a good place for the investment dollars that could free up from a possible CVS sale.
Thoughts?
Do you foresee additional market gains through the end of the year? Is there a stock in my Portfolio that you think I should unload prior to letting go of BMY or CVS? Please share your thoughts!