I executed my first Portfolio transactions of 2026 earlier this month and it’s well past time that I provide the details on what transpired.

I made mention of such potential transactions in my last Portfolio Thoughts post.  Apparently, I felt pretty strongly about making the moves!

In total, I made 4 transactions, comprised of 1 sell and 3 buys.  The sell involved one of my Industrials holdings (a sector which I want to have a smaller weighting in my Portfolio).  While the stock was a very good performer, it was looking overvalued after a recent increase in price.  In addition, it was my smallest Industrials position, and the one with the lowest dividend safety score, so these factors made it a decent candidate for sale.

I then reinvested the sales proceeds, allocating the majority of the funds to another Industrials stock, and some of the funds to two stocks in the Information Technology sector (a sector where I wish to increase my Portfolio weighting).  All three stocks I bought are existing Portfolio holdings.

Some of the proceeds were held back from reinvestment in order to cover the capital gains tax realized from the sale.

All the transactions resulted a net withdrawal from my Portfolio, but yet added a small amount of forward dividend income.

Here are the details for my first Portfolio transactions of the new year…

 

FedEx (FDX)

I initiated my position in FDX back in Sept. 2022 after it sank over 50% in a little under 5 months time.  The stock was looking undervalued, and had been displaying some nice dividend growth.

FDX stayed as one of my smallest holdings, as I’d already established plenty of large Industrials positions.  However, I did make a couple of small additions to my FDX position in 2025 in an attempt to maintain a minimum 0.5% weighting for it in my Portfolio.

The stock has mostly climbed in price while I’ve held it, except for a significant pullback in the first 4 months of 2025.  Since that time, the stock has risen sharply, especially since the start of the new year.

FDX is planning a spin off of their freight business (approx. 25% of profits) on June 1st of this year.  Unfortunately, this would just make my small Portfolio position turn into two smaller ones.

In addition, FDX has one of the lowest dividend safety scores in my Portfolio.  Simply Safe Dividends has a dividend safety score of 64 (out of 99), which is on the lower side of the ‘Safe’ range.

The recent gains and the pending spin off motivated me to sell my small FDX position and re-allocate the funds to some other existing holdings that were down on their luck.

On 2/2/26, I sold all 19.848 shares at $331.30/share.  The sale proceeds were $6,575.64.  There was no SEC fee.

At my sale price, shares of FDX yielded 1.75%.  This approached being one percentage point lower than my current Portfolio yield of 2.57%.

With this sale, I realized a long-term capital gain of $2,540.57 and a short-term capital gain of $490.27.  These were my first capital gains of 2026.  The FDX sale also resulted in a $115.12 decrease in my annual forward dividend income.

Since my initial purchase back in September 2022 until this final sale, I calculate my annualized return for FDX to be a stellar 30.32%.  FDX posted double-digit returns for me every year I owned it.  Why did I sell again?  🙂

Here’s what I bought with the majority of my FDX sale proceeds…

 

Automatic Data Processing (ADP)

This is one of my favorite holdings.  The stock is steady rather than flashy.  It sports double-digit dividend growth rates over 1-yr, 3-yr, 5-yr and 10-yr periods, and it’s a Dividend King (50+ years of dividend raises).

The stock tends to be overvalued for extended periods of time.  However, recent price declines have ADP in fair-to-undervalued territory for me.

I established my ADP position with a series of purchases at the start of the pandemic when the price was declining on a daily basis.  The stock seems to be in another period of daily declines now.

The recent declines have been brought on due to different reasons though.  With employers being cautious these days hiring new employees, payroll growth has slowed.  The cautiousness apparently stems from a mix of economic uncertainty, pandemic over-hiring normalization, and the advance of artificial intelligence (AI).  The latter seems to be weighing on ADP most heavily.

Investors seem to be worrying that AI could stunt white-collar employment growth.  Since, ADP typically gets paid by collecting recurring fees that are tied to the number of employees on payroll, limited or no payroll growth puts a serious dent in ADP’s growth.

While the impact of AI is still unclear, investors seem to be fearing the worst and the stock price is reflecting that.  ADP appears to be caught up in the indiscriminate selling of software stocks over the past month.

On 2/2/26, I purchased 18 shares of ADP at $247.50/share, for a total of $4,455.00.  The stock yielded 2.75% at my purchase price.  This was slightly higher than my current Portfolio yield.  The buy added $122.40 to my annual forward dividend income, which was a bit more than I gave up during the FDX sale.

As a result of the purchase, my ADP position grew by nearly 31%.  My ADP position is now at 76.113 shares.  The buy also raised my cost basis by a substantial $19.56/share, to $184.33/share.

With the purchase, ADP moved up my Portfolio rankings by 4 spots.  It climbed from my 21st largest holding to my 17th largest.  ADP is now sandwiched in between Pepsico (PEP) and Illinois Tool Works (ITW) in my Portfolio rankings.

 

Microsoft (MSFT)

Similar to ADP, I established my MSFT position at the beginning of the pandemic.  However, it was only a single buy at the time.  In the years since, I’ve added a share or two at various times, eventually doubling my share count while the stock price rose over the course of time.

MSFT peaked in price near the end of last October, around $555.  It then dropped into the $470-$490 range over the next month and stayed there for about one and a half months before sliding below $400 in the past four weeks.

With MSFT being a software stock, it too succumbed to all the selling in the sector, leading to its lower price.  The price fell far enough that I was interested in adding to my share count once again.  The fact that MSFT is in the Information Technology sector (where I’m looking to increase my weighting) was a bonus.

On 2/2/26, I bought 2 more shares of MSFT at $425.00/share, for a total of $850.00.  The stock yielded a meager 0.86% at my purchase price.  This yield is roughly one-third of my current Portfolio yield.  The purchase added a small $7.28 to my annual forward income.

As a result of the purchase, my MSFT share total increased by almost 10%.  I now own 22.689 shares.  My MSFT cost basis climbed by a noticeable $18.30/share, to $235.73/share.

MSFT rose 2 spots in my Portfolio rankings due to my share addition.  It climbed from the 39th largest holding to my 37th largest.  MSFT now sits below BlackRock Health Sciences Trust (BME) in my Portfolio rankings, but above Nike (NKE).

 

Intuit (INTU)

One of my stocks that’s been punished the most by the software selloff is INTU.  Just one week into the new year, INTU was trading above $650.  Today, the stock can be had for less than $380.  That’s a very swift drop in about 5 weeks time.

When the stock dropped below $500, I got interested enough to add.  However, it was a minor add, as I didn’t know if more pain was to come.  Unfortunately, there was more pain coming.

I’m not sure the magnitude of the price drop for INTU is justified, but the market tends to react first and figure things out later.  I suspect it may take a few more quarterly results to be posted before we’ll know if AI is disrupting INTU’s business.

While I may not have timed the bottom very well, I did increase my Info Tech weighting some more, and I was able to lower my cost basis in the stock.

On 2/2/26, I purchased a single share of INTU at $492.50/share.  The stock yielded a small 0.97% at my purchase price.  This was 1.6 percentage points below my current Portfolio yield.  The buy added a minor $4.80 to my annual forward dividend income.

With my single share addition, my INTU position grew by about 8.3%, and my share total settled at 13.06 shares.  The buy lowered my cost basis by $7.32/share, to $580.77/share.

Due to the buy, INTU rose in my Portfolio rankings by 2 spots.  It went from my 7th smallest holding to my 9th smallest.  INTU now trails Main Street Capital (MAIN) in my rankings, but is ahead of Amdocs Ltd. (DOX).

 

Summary

I made my first Portfolio transactions of 2026 in early February.  Sadly, it looks like I may have pulled the trigger on the changes a bit early, leading to less cash in my pocket than I could have had if I’d waited a couple of weeks.

I made one sale (FDX), eliminating the stock from my Portfolio.  I followed that up with three buys (ADP, MSFT, INTU), using most of the sale proceeds in the process.  The largest purchase was ADP, which kept most of the money in the Industrials sector.  The leftover cash was set aside to pay capital gains tax.

Since I sold FDX, it’s continued to climb in price.  Since I bought ADP, MSFT and INTU, they’ve all proceeded to decline further in price.  Ouch!

All the transactions resulted in a net withdrawal from my Portfolio of $778.14.  However, my forward dividend income still moved higher by $19.36.

With the sale of FDX, I realized long-term capital gain of $2,540.57 and a short-term capital gain of $490.27.  The annualized return for my FDX investment over the ~3.5 years I held the stock was a terrific 30.32%.

Since FDX was eliminated from my Portfolio, but buys ADP, MSFT and INTU were already part of it, the number of holdings in my Portfolio reduced by one to 57.

 

When’s the last time you were too early in executing a transaction?  Do you hold FDX in your portfolio?  Do you own any software stocks that have gotten clipped in price over the past month?  I look forward to your comments!