Dividend Diplomats May Watch List

Okay everyone, we are almost 5 months into the year and how are we doing with our goals?  Any stocks on the radar?  Well, us Dividend Diplomats have a few stocks on our watch list and we are ready to dive into what we are seeing in the market, what undervalued dividend investing stocks are worth taking a peak at.  Maybe some we already own or some we don’t even have a position yet.  OR maybe a stock or two the other diplomat owns and we jealous and want a piece of the action!  Whatever it may be – lets go take a look at what is on our May Dividend Stock Watch List!

Watch ListLanny’s Stock Watch List

lb watch
IBM: Alright – two of the same stocks we have all been seeing from us Diplomats.  First, to start with IBM – loving the 18%+ dividend growth that was announced last month – us share holders were pumped, as I discussed in my April Dividend Income article.  Similar to what Mantra stated in his allocation article, tech isn’t a large portion of his portfolio (ideally) at 2.5% and IBM is currently at 3.9% of mine, which is fairly small, in my eyes, and wouldn’t mind to see it closer to 5%.  I’ve purchased IBM quite a few times after I initially created the analysis article about 6 to 7 months ago.   Quite a bit has changed since then, where the stock has surged over $170/share, but this goes along with the monster dividend increase, something as expected.  The yield has remained approximately the same at ~3% and I like where the price is at and am considering to increase my position.  What does everyone think here?  The payout, yield, growth and share buy back all pan out for me, as well as the price to earnings ratio, thoroughly clearing the dividend diplomat stock screener.  Highly considering adding more here.

NSC: Next on deck, the choo choo train it is.  Back a month ago I performed a detailed stock analysis over Norfolk Southern.  Then,  Bert’s Jewish self decided to make a move on the stock after the Italian did all of the grunt work, the nerve in that guy!  He therefore initiated a position into NSC earlier this month, congrats on the move and then he loved it so much he decided to take the train again and purchase it twice, who knows – maybe he purchased it 3x, as the third time is the charm?  Similar as we did with IBM above – the price to earnings is fairly low, the growth rate is very sound and solid over double digit, payout ratio is low and the share buy back program is in full effect.  Loving this train for sure, I’ll hop on these tracks to catch a ride at any time.  I am also considering this highly, the yield is at 2.46%, which is above their 5 year yield and man… talk about a cool stock and an industry I actually don’t own – the transportation of goods and services.  Definitely on my list and radar now/again!

Okay, what do ya’ll think here?  Bert – what are your thoughts?  Well, you are on deck, let’s see what you got!




Bert’s Stock Watch List

bb watch

 

Alright Lanny, thanks for the hand-off right there.  Those are two very solid stocks and I personally think that NSC will make a great addition to your portfolio.  After buying NSC three teams this month, I better feel that way!  And IBM, why not add look to add some more shares to your portfolio.  Right now I have 4.7 shares of the company…are you kidding me, this stock should be on my watch list as well.  You know what, I am unofficially adding it as my third stock that I’ll be watching!   Now, time to focus on the main two stocks on my watch list.  They have been two pretty popular stocks on our website recently and we each bought one of these stocks twice since March.  Let’s see which two stocks I am watching over the next month or so.

JNJ- Thanks for doing the heavy lifting for me on this one Lanny, your analysis helped me out a ton here.  Over the last couple of weeks, Lanny purchased JNJ twice recently and now has a pretty sizable holding in company.  And you know what, I can’t blame you one bit and I watching JNJ like a hawk to find the perfect moment to initiate a position.  JNJ just announced another solid dividend increase, has a forward P/E ratio below the S&P, is nearly yielding 3%, and has a payout ratio that leaves room to sustain a 7% DGR.  To me, this is close to a no-brainer for this foundation dividend stock, which I could argue is worthy of purchasing at a premium.  I’ll leave that last point up for debate though.  Unless the stock decides to continue increasing 3% weekly, I should be looking to purchase this stock soon as I will address a mutual fund problem that I currently have (foreshadowing for a future article).

ADM- I mentioned that the two stocks on my list have been actively monitored by us, right?  Ever since I performed a stock analysis over ADM in March, I love the stock so much that I decided to purchase ADM twice over the last couple of months.  Could I have one more purchase in me?  So why am I looking to purchase ADM again?   Currently, my cost basis is just south of $1,300.  Lanny and I have had several conversations recently about the size of our holdings, and I left our discussions with a mindset of trying to maintain a minimum cost basis of $1,500 for all my investments.   As mentioned above, my $1,300 cost basis falls below this floor, so I would love to  add another $500+ to my current position.  Even though my investment in ADM has increased 9.5% since my purchases, ADM still has a forward PE ratio lower than the S&P,  the DGR is 12.54%, and the company has re-purchased over 5% of their shares over the last year.   Plus, the payout ratio is 33%, so the double digit dividend growth is sustainable.  Worthy of watch status in my opinion!

Conclusion

There we have it folks.  Four rock solid dividend growth stocks.  This is a unique watch list for us, as this is the first time that our watch list consists solely of stocks that one of us already own.  I love this, why search to find a diamond in the rough when you have some undervalued dividend stocks right under your nose.   If they are in our portfolio, that means they passed the rigorous Dividend Diplomats Stock Screener after all….Just saying!  What are your thoughts on our watch list?  Have you purchased these stocks recently or are you looking to do so?  Do you like the format of our watch list or would you like us to provide any additional information in the future?

-The Dividend Diplomats

DISCLOSURE: WE DO NOT RECOMMEND ANY DECISION TO THE READER OR ANY USER, PLEASE CONSULT YOUR OWN RESEARCH. THIS IS ACTUAL DATA, ANALYSIS, HOWEVER I BASE NO INVESTOR RECOMMENDATION.  THANK YOU FOR YOUR UNDERSTANDING.

 



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10 thoughts on “Dividend Diplomats May Watch List

  1. I like all four. I own JNJ and IBM. I would love to own ADM and NSC. You really can’t go wrong with any of them. Tomorrow I plan on buying OHI. Hopefully it has a down day today. 🙂

  2. Those are all great companies to consider. I’m long JNJ and I feel like I missed the boat on IBM (plus I’m tech heavy), so those two are out for me. Of the remaining two on your watch list I’m really interested in ADM. In fact, that will most likely be my next purchase.

    Ken

  3. Diplomats,

    Solid choices across the board. Tough to go wrong with any of them. I’m loaded up on JNJ or else I’d be looking strongly at it.

    Have fun shopping. That’s half the fun! 🙂

    Best regards.

    • IS,

      JNJ has been a great stock and if you were able to grab it between that 98-102 mark = amazing, always amazing buying them, but that was such a sweet spot!

      UNP is a great company as well, NSC took a slide to the mid-95’s so worth taking a look as well.

      Have a great weekend too, thank you!

      -Lanny

  4. I’m liking JNJ and ADM from the companies mentioned. I just initiated ADM a few weeks ago along with DOV. Both have been on a tear over the last month and I would love to add more. Nice to see some names that aren’t energy related for a change even though many still offer pretty decent value and yield. Thanks for sharing.

    • DivHut,

      Nice list there! Right – energy has been the hot area as of late and glad we can “differ” when we can. I actually haven’t bought much energy lately, obviously always something to consider. I know Bert loves his ADM, so you and him can duke out on who has the larger position!

      Thanks DH, talk soon!

      -Lanny

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