Earnings season has been upon us for this past quarter and wow, things are starting to move, shake, drop, pop and roll. On April 19th, things were no different. After seeing quite a few stocks that are strong dividend players drop, one company caught our eye. I messaged Bert saying, “Alert, PG DROP!”. The rest was history. We both ended up purchasing additional positions into Procter & Gamble (PG)!
Procter & Gamble (PG) Stock Purchase
PG has been one of those legendary, legacy-living, dividend packed, dividend aristocrats. They are a stand-out on our Top 5 Foundation Dividend Stocks for your portfolio. They have increased dividends for 61 years! Their 3 year dividend growth rates, prior to this year’s, was a 3%, 1% and 3%. They came out this year, showing further promise, with a 4% dividend increase. This is better & heading into the right direction. Technically, you could say this is an improvement for 2 years in a row.
Lastly, as we all know – they make some of our favorite products. Products such as, Charmin, Crest, Dawn, Febreze, Gain, GIllette, Oral-B, Tide, Vicks, Tampax; the list goes on. We see these products every single day. We hear people talking about one of these products, almost every single day. That is brand power & loyalty, at it’s finest. And, there was another announcement on our date of purchase that impacted the company’s brands. The list will grow, and PG purchased Merck’s consumer brands unit. This will add brands such as Seven Seas, Femibon, and Neurobion, and many others. Therefore, when a stock like this drops 5% in a single day, how the heck do you stay on the sidelines? Let’s just say, we weren’t sitting on the sidelines for this one.
Lanny’s Purchase of Procter & Gamble
You’re damn right I decided to Just Go For It and make every dollar count in this situation, and that I did. The stock price had a shock drop of around $4 per share on the 19th or over 5%! It dropped to a price that I never had been able to purchase them at before, and I just couldn’t resist picking up an aristocrat at these levels. I purchased 13 shares of Procter & Gamble (PG), to round out my position to just over 45 shares of the consumer monster in my dividend portfolio. Based on a dividend of $2.869 per share – this added $37.30 on a going forward basis and cost me at total of $965.25, with no commission due to a trade credit, see below. Price was at $74.25 and PG was yielding 3.86% at the time and a 17.7 price to earnings ratio.
Bert’s Purchase of Procter & Gamble
After Lanny surprised me with the news about PG’s price falling, I was at first pissed off for two seconds that I didn’t catch the price drop myself. But that feeling quickly went away once he let me know he purchased the stock, I took a second, and decided that I was going to also add to PG for the second time this month. Yes, I purchased 9.63 shares earlier in the month before the company’s dividend announcement. So I was pretty darn excited to add an additional 13 shares to PG, just like Lanny, and add $37.30 to my forward dividend income. Now, I own 76.2008 shares of the consumer giant and will receive $218.60 annually from PG. But, the caveat is, I will not receive the dividend in May since this purchase missed the ex-dividend date by one day! It’s okay though and I’m going to hit the third quarter with a full head of steam. One other note. Once again, Lanny purchased the stock at a lower price than me as he made the purchase faster. That’s what happened with our combined purchase of Dominion. Maybe next time I’ll make the purchase first and get the better purchase price!
It looks like these combined purchases are becoming common place for the two of us. We’re lucky that the two of us can talk regularly to each other and quickly arrive at an investing decision. In the case of PG, this was a relatively easy decision to make that did not require a ton of convincing by both parties for all the reasons discussed above. Now, we are continuing to build our position in the Dividend Aristocrat, enjoy another solid dividend increase, and patiently wait for the next opportunity to strike. The market continues to present some nice buying opportunities, so it is all about catching the right stock at the right time. The name of the game! So now, let’s focus, side hustle, and build up our cash reserves so we can push forward and continue to purchase undervalued dividend growth stocks! LETS GO!
Lanny and Bert, The Dividend Diplomats