Lanny’s 2017 Portfolio Review

I  keep a copy in PDF of my portfolio every quarter, and have a deeper dive at 12/31, but this also provides a blog’d example of where I stand, so I can always refer back on the site the historical position of my portfolio.  As we have done in the prior years, this post will be an overall recap of my portfolio, the contributions, dividends going forward, dividends received, what I can analyze from the current position, etc..  It’s always fun to see what the year compiled into one snapshot of all of the hard work that goes into the dividend engine.  I am excited to see where it stands and what can be done going into this new year!  Let’s dive on in. 

Last year’s post on the portfolio review, I was talking about the difficulty in finding a solid investment, given the overall market increased almost 10% in 2016.  Guess what?  No real change there, as the S&P 500 increased almost 20% in 2017!  This is interesting.  2015 to 2016 brought two different market environments.  Then 2016 to 2017 brought more appreciation in the stock market with Donald Trump elected into office and the official approval of Tax Reform.  It’s what keeps the investing portion of life interesting – no predictions accepted : )  I’ll provide the brief snapshot of 10 attributes on my portfolio, as you’ll see below, and then do an even more analysis surrounding my thoughts of how that came to be and what will 2018 bring from an actual action stand point.  Here comes the 2017 review of my portfolio:

Portfolio Review

For this analysis – you can find the the portfolio page to follow along.

  1. Contributions (Including Retirement, H.S.A., dividends reinvested) YTD 2017 (not including 401(k) match): $47,189.95 (2016 Amount: $45,229.41; Average of $3,932.50 per month, up from 2016’s $3,769.12 per month)
  2. Portfolio Market Value as of 12/31/17: $328,262.83 (Up from $235,056.30 or $93,206.53 or 39.65%)
  3. Portfolio Estimated Income for 2018 as of 12/31/17: $9,732.01 (Up from $8,066.87 or $1,665.14 or 20.64%)
  4. Portfolio Yield (Overall): 2.96% (Down from 3.43% or down 47 basis points from 12/31/16)
  5. Portfolio Yield Individual Account: 3.05% (Down from 3.50% or 45 basis points from 12/31/16; talk about appreciation)
  6. Portfolio Yield Retirement Accounts: 2.92% (Down from 3.40% or 48 basis points from 12/31/16)
  7. Portfolio Yield on Cost (Overall): 4.63% (Down 6 basis points from 12/31/16)
  8. Positions in my Individual Account: 43 (Up 6 net new positions)
  9. Positions, including 3 mutual Funds and 1 ETF, in Retirement Account & HSA: NO CHANGE! – Remains at 13
  10. Total Dividend/Distributions Received in 2017: $9,228.26 (Up from $7,406.43 or $1,821.83 or 24.60%)

What does all this information mean – one may be asking?  Well, I figured I can start from the top and work my way down.  Total contributes were up, year over year, but not by much.  I actually got engaged this year, and, well, the hardware isn’t inexpensive : )  However, I am still up overall.  This partly has to do with a raise from work, my full automation tax-strategy of maximizing my 401(k) and my Health Savings Account (HSA).  Further, more dividends were received & put to work – the power of dividend reinvestment, was in full effect.  Further, I paid my car off in August and this was a byproduct of having more cash flow to invest!

Ah, then you have market value.  The market value of my portfolio compared to the year end last year is up a WHOPPER $93,207… are you kidding me?  I’m closing in on $400K and it’s becoming quite alarming how fast this is ramping up.  This year I wrote about me crossing over $300,000 and I am already/almost $30K beyond that point.  When I calculated my performance this year and backing out my 401(k) match from my employer, I had a 16.30% performance on the year.  See below, the S&P’s YTD performance of +19.42%.  I was not able to achieve the market’s return, but came close.  I out paced the S&P last year.  I was 3.12% off, which is actually quite a bit.

Another tough year on finding the right investment front, with the increase in the stock market.  I was able to make 6 new positions this year actually, as it was very difficult to invest in companies I had already owned.  New Investment Purchases:

  1. CVS Health Corp (CVS)
  2. Grainger (GWW)
  3. Cisco Systems (CSCO)
  4. Kroger Grocery (KR)
  5. Delta (DAL)
  6. Hormel (HRL)

Even with adding over $47,000 of capital into the portfolio, I did not achieve my $10,000 goal.  I added $1,665.14 to my forward income.  This is an interesting take – the $47,189.95 yielded 3.52%.  However, this is not an actual case, as dividend growth also caused quite a bit of that yield/increase.  To conclude, dividend added was at a yield lower than what I am typically used to, due to the appreciating stock market, lower growth rates on dividends and new investments typically had a lower yield with higher dividend growth prospects.  Damn you 2017!

My yields overall have decreased.  This is very easy to point out – stocks just increased that much more this year, however, I will note that dividend increases weren’t quite as strong, again.  And actually… when going to multpl.com… it was only a “resounding” 5.87% (through 9/30/17(, when it was much higher in the past.  Further, due to my purchases in S&P 500 mutual funds, with their lower yield, my Yield on Cost, decreased.

2017 Portfolio Conclusion & Summary

How do I conclude in my portfolio of 2017?  My portfolio grew the most it ever has, the dividends added were more than I ever had done before and damn I’m tired.  The market appreciated almost 20% and I know my portfolio benefited tremendously from the momentum.  My goals for 2018 are interesting and still constitutes capital to be infused.  However, more dividends going forward should assist/take the burden of some of that.  The 401k & HSA max increased for 2018,  however, the federal tax benefit isn’t quite as much as it has been, but still very relevant in this journey.  Further, I should have unlocked more capital with a small decrease in the tax rate, with the exception of saving quite a bit for the wedding this year (haha).  Either which way, I’m pumped to place my portfolio in the best position possible, using the dividend diplomat stock screener to review companies for investment, keep a keen eye on the aristocrats that are a foundation staple in a portfolio, or pushing myself to new heights when setting lofty goals.

With all this being said – what do you see in my portfolio?  How did you do?  What actions will you take into 2018 going forward?  Looking forward to hearing from everyone and thank you again for coming by!  Hope everyone is having a great start to the new year and are ready for the horizon of the upcoming year.  Good luck and talk soon!

-Lanny

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39 thoughts on “Lanny’s 2017 Portfolio Review

  1. Hi Lanny, I agree with you that as 2017 moved along it became harder to find dividend stock investments that were reasonably valued. My purchases slowed throughout the year for this reason. I hate to say it, but we could use an orderly pull back in the market to open up more opportunities. Tom

  2. Lanny –
    45K+ a year in contributions is awesome!! Keep this up.
    I noticed you said that you’ve contributed to your HSA and 401(k), but you didn’t mention your IRA.
    Do you contribute to one or have you decided on reasons not to?
    Thanks for sharing!!

    • Chris –

      Thank you, tough, very tough. I do contribute the IRA, but had to do all Roth for 2017 due to my expected tax situation. I prefer to do as much pre-tax as possible. This is mixed, as I purchase individual stocks, in with other investments outside of 401k and HSA.

      -Lanny

  3. Hopefully a few more years of dividend raises will bring your yield back up to where it was. Either way, it’s great to see a macro analysis like this! Nice job keeping your contributions up while life keeps changing.

    • The Dozer –

      I hear ya. That yield… so tough to keep up with all of the appreciation going on. REITs are nicely on sale, as well as utilities – keep the lookout on for sure! Appreciate the stop by, as always. And yes – life is something hard to control, that’s for damn sure!

      -Lanny

  4. 45k in contributions is pretty awesome. I was just north of 30k and will be doing my portfolio review soon. I had good results in my individual portfolio so that drove a lot of solid results for me.

    I agree that it’s getting harder and harder to find stuff that seems like it offers a really good return profile going forward.

    • Time –

      What’s funny is with the 401k, HSA – the $45K+ didn’t even feel like I did it. I think it also has to do with dividends received and invested that added a HUGE chunk to the amount, as well. That is something I always have to keep in mind.

      We are investors and not making a purchase, is also making a decision to do what is best for capital you have. We will find the right move when it catches our eye, just need to keep looking!

      -Lanny

    • Jordan –

      Thank you very much! The expense ratio is 0.035% aka very low and the lowest offered within the 401k. Smart move to do that and rid yourself of high fees.

      Appreciate it and you the same!!

      -Lanny

  5. Looks like a solid year Lanny. $45k of contributions is fantastic and is really all that’s in your control because the markets will do what they want to do.

    • JC –

      Agreed, it’s hard, but luckily – the dividend engine does quite a bit of it’s thing. 2018 should benefit well from the way 2017 ended – with almost $9.7K at least going into the market alone from dividends. Very excited for the next 11.5 months!

      -Lanny

  6. Nice post, Lanny. Congratulations on your progress.

    As you highlighted, valuations in 2017 were quite high, resulting in lower yields. We also actually dialed back contributions to build up some cash (I know, I know – a FIREable act).

    Thanks for sharing. – Mike

  7. Wow! What a wild year you had for yourself. Congrats on getting engaged!

    I am finding some of the same problem of finding the right investments in this very excited market. It is interesting how dividend investors may try to time their sector rotation a little differently than the average investor.

    Keep it up!
    Kevin

    • Kevin –

      Thank you, thank you!! It’s been fun trying to plan this out during busy season as a public accountant.

      Keep an eye out for the REITs and Utilities – getting hammered out there. ConEd is looking nice!

      -Lanny

  8. Wow! Closing in on 400k alright. And you infused a massive amount of capital this year Lanny – it’s really picking up momentum!

    My portfolio hits one year in April, so I’ll do a review then. In the mean time, there is income to be earned!

    • WF30 –

      I am getting close to it! At $340K today, actually, so WEIRD, to be honest. The market has helped SO much, and I know I should not pay that much attention to it.

      Congrats on almost the 1 year market, HUGE. Excited to read the post. Keep on adding, keep on doing what you’re doing and stick to your strategy if its working!!

      -Lanny

  9. Hey Lanny,

    Congrats on your fantastic achievements in 2017 – i can imagine that this has cost you a lot of energy, but you’ll get rewarded with a monster income stream in a few years if you can keep your contributions that high.
    I try to pump about 20k of fresh money into my portfolio per year, maybe 25k in 2019… in the end it comes down to the savings rate!
    In the second half of 2017 i was tired and running out of energy and this cost me some extra money (my job is demanding and besides i had a huge renovation at the house), but in February i’ll take on a new money challenge.
    When it comes to new investments i’ll take a conservative approach in 2018. Invest on a regular basis, but increase the cash reserve along the way…- Mr. Market is a little on the crazy side i think.

    Best Regards,
    DividendSolutions

    • DS –

      Thank you, thank you and thank you. $20K of fresh dough into the portfolio is very stellar. You can do it, and savings rate is exactly what matters, as you can’t do it unless you have a strong savings rate. I cannot strongly recommend keeping that as high as possible should be a priority.

      I can understand the burden of work and house reno’s – Bert can attest as well.

      I do like the basic strategy of consistent investing, at the right amounts and taking the emotion out of decisions. You can do it, and we are excited to read about it!

      -Lanny

  10. Good year Lanny,
    Looks like your reaching the point where your ball is rolling faster and faster down the hill. As for 2017 yield I am starting to get concerned and div increases slow yet companies still increase profits. I wonder if a trend has started with less companies offering a dividend or slowing in favor of capital growth. I guess we will see and adjust as necessary.
    Later,
    DFG

    • DFG –

      The snowball is picking up speed, which is great during the cold winter months and I’ll take it, every single day.

      I can understand your concern. We will have to see, especially this being the first month. I am leaning towards seeing at least similar growth rates as last year and am slightly optimistic they will excieed those expectations. Time will tell!

      -Lanny

  11. Congratulations on a great year! There’s nothing wrong with trailing the S&P 500 during an extremely bullish market, that’s the tradeoff since dividend stocks do better than the index in weaker markets.

    For 2018, I agree there aren’t a lot of values out there. 45 minutes into the new year, I maxed out my Roth IRA by adding to PRGTX and VWINX. Talk about a party animal. I’m also planning to add to BAM, CME, and maybe WTR (which has come down in price quite a bit this week).

    • Brian –

      Thank you, I appreciate it and you are spot on right. I am def. okay with it.

      WOW. Just getting AFTER IT. Nice work. LOVE WTR right now!!! It’s almost below $35 at this point, keep an eye out hard on that!

      -Lanny

  12. Great work breaking down your portfolio performance. You numbers are very impressive!

    As the stock market gets higher and portfolio totals start breaking new marks the “realist” comes out in me and reminds me this number won’t last forever, BUT those increasing dividends coming in every month SHOULD continue to grow and as long as that is happening, I’m a happy camper!

    -MH

  13. Lanny,

    It is great work all through 2017. Very consistent investing almost 4k a month is impressive.
    4.63% yield on cost and forward expected dividend income of 9.7k both are excellent figures.

    Good luck this year for another set of great numbers. Keep that snow-ball rolling.
    TDK.

    • Karma –

      Thanks for the comment. It feels crazy thinking I was almost at a $4k clip each month, just doesn’t seem real! Most of that is automated (401k, HSA + dividends), and you always feel like you can do more.

      Looking forward to more reinvestment and investing. 2018… ah… 11.5 months left!

      -Lanny

  14. It’s crazy looking at these end of 2017 snapshots and seeing what the market has done! I’ve certainly found it harder to find great value stocks in the Australian market, but there’s still a few potential gems there I’m planning to add to my new Fund. Let’s hope the party continues in 2018!

  15. Hey Lanny, Outstanding 2017 for your portfolio! Those yield drops were significant, but to be expected with the large price gains – an acceptable trade-off, right? Looks like you made out pretty well with your 6 new stock additions in 2017, too, as most if not all had a nice run up to close the year. You’ll hit $10K in dividends this year, which will be awesome. Best of luck in 2018. Oh yes, almost forgot… congrats on the engagement… exciting times ahead!

  16. Hi Lanny
    What a great set of financial achievements in 2017, congrats and all the best for the New Year!
    You really put a significant amount of money to work, I particularily like Hormel Foods, consumer staples are my favourite investments 🙂
    My portfolio showed a quite similar boost, almost 25 % higher. European stocks have not performed as strongly as their US peers but the Euro strengthened quite significantly (more than 10 %) against the Swiss franc (Denomination of my portfolio). It really is an amazing bull market, as of 1.1.2018, my portfolio had a market value of CHF 170’000 and two weeks later it sits at CHF 175’500. My portfolio currently adds more to our wealth than savings from our jobs. Anyway, these are just numbers and my wife and I will certainly not get too excited about that. What’s important for us is keeping our savings rate comfortably above 50 % and to continue investing. I find it more and more tough to see value in the current market environment.
    For 2018, we target a passive income of at least USD 6’000 (up at least 20 %).
    Cheers

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