Lanny’s Dividend Stock Purchase Activity – November 2019

On your journey to financial freedom or financial independence, you have to stay hungry out there.  November didn’t provide the best Dividend Stock opportunities, but one can always find diamonds in the rough.  Time to check out my November activity!

Investing consistently in Dividend Income Stocks allows you to create & build another income source, with Dividends.  This is my primary vehicle on my road to Financial Freedom, which you can see through my Dividend Income and my Dividend Portfolio, to which continues to build and build.

How do I make dividend stock purchases and screen for dividend stocks?  I usually put the stocks through our Dividend Diplomat Stock Screener and trade on Ally’s investment platform (one of our Financial Freedom Products).

See – Dividend Diplomat Stock Screener

See – Financial Freedom Products

How do I build the capital to make these stock purchases?  I save anywhere from 60-85% of my take-home pay and strongly believe Financial Freedom does not happen by hitting a home run on an investment.  Nothing matters more than your savings rate on your journey to Financial Freedom, plain and simple.  Therefore, I work my butt off to make sure expenses remain in-check and that my savings rate is meeting our investment and financial independence goals!  Then, you rinse and repeat.

The stock purchases

November was a straight bull-type month for investors.  This made it significantly more difficult to find an undervalued dividend stock to purchase.  Look at the chart below.  The market went from above 3,050 to end over 3,140 to wrap up November.  Obviously, that is why I don’t try to time or predict the market, that’s for sure.

Even with the market screaming upwards, I was still able to find and invest into dividend paying stocks throughout November!

Stock Purchase – CBS Corporation (CBS)

I threw a curve-ball at the Dividend Investing community, I am sure, with a dividend stock purchase into CBS Corporation (CBS).  If you don’t already know CBS is a mainstream broadcast television and radio network.  The air shows such as, but not limited to, 60 Minutes, Survivor, Hawaii 5-0, SWAT, Criminal Minds, Big Bang Theory, etc..  Further, they recently announced an acquisition of Viacom (VIAB), which owns MTV, VH1, BET, Nickelodeon and the beloved Paramount entertainment vehicles.

Therefore, I felt that was compelling for an initial investment into CBS.  This was a small investment and I would not classify CBS to be a significant part of my portfolio, by any means.  I like the industry, keeping tabs on Box Office results and they hold some of my favorite shows and movies.  Further, doesn’t hurt that they were down approximately 20%+ YTD at the time of my dividend stock purchase!  On to the numbers for CBS!

  1. Price to Earnings: Analysts are expecting $5.23 for 2020.  At a purchase price of $38.40 this equates to a price to earnings ratio of 7.23.  Holy smokes.  Low as heck.  Strange, right?
  2. Dividend Growth: Now, CBS does not normally increase their dividend every year, that is a fair warning to everyone reading.  However, when they do, they do it in sizable amounts.  This gives CBS a 9% dividend growth rate average spread from 2014-2019.  They haven’t increased their dividend, though, since the Q1 2017 payment.  I anticipate one, potentially, 2021.
  3. Dividend Yield: CBS produces $0.72 per year in dividends.  Their dividend yield, at time of each purchase, was 1.875%, which is slightly in line with the S&P 500 of 1.82%, currently.  Not a screamer, here, but there should be high dividend growth in the future.
  4. Payout Ratio: Based on expected earnings of $5.23 and a dividend of $0.72 per year, this equates to a payout ratio of 13.8%.  This is another SIGNIFICANT reason for the purchase.  CBS can easily announce another 20-30% dividend increase and it would do nothing to their payout ratio.  A 22% dividend increase would only raise the payout ratio 3%, for example.

Here is proof of the investment purchase below:

I purchased an additional 25 shares during November for a total cost of $960.00. The 25 shares added $18.00 to my forward dividend income projection.  I am looking to acquire an additional 25-50 more shares of CBS in the future if prices come back down, as they are up over 5% since my purchase.

Stock Purchase – Armanino Foods (AMNF)

 

You better believe I made a move on this Italian food production company, the “pestobilities” within their performance is high, no doubt.  In fact, they were featured in my Dividend Stock Watch List article recently.  How about the numbers at the time of purchase?

  1. Price to Earnings: At the price of $3.52 and $3.42, respectively, with a forward earning projection of $0.21 for 2019 (based on annualized figures), this equated out to a p/e ratio of approximately 16.76 and 16.29, which is well below the overall market on average.
  2. Dividend Growth: They are young in their dividend streak, as they are on 5 years+ now, consecutively.  Their recent increase was approximately 11.11% and the double digit was extremely appreciated!  See why the impact of the dividend growth rate is real!
  3. Dividend Yield: With the $3.52 and $3.42 price point, at a dividend of $0.10, their yield was at ~2.84 and ~2.92%, well above the S&P 500 (on average).
  4. Payout Ratio: Based on forward earnings of $0.21 and a dividend of $0.10 per year, this equates to a payout ratio of 47.6%.  Right where I like it, in between the 40% and 60% range.

Here is proof of my investment:

In summary, I purchased an additional 145 shares at $3.52 and $3.42 for a total cost of $502.90. The 145 additional shares added $14.50 to my forward dividend income projection.  In total, now, I own over 663+ shares of AMNF, which produces $66.36 in dividend income per year.

Mini Stock Purchases (Less than $500)

Now, here’s a new segment.  Since the trading wars have heated up and fees now are $0 to trade, I am going to list out and talk at a significantly high level, those dividend investments made that are < $500.00.  That way, I can still show the results from the month, who I am buying, the impact; but also – not to go into too much detail on smaller purchases.

Therefore, I purchased 4 shares into WestRock Company (WRK), to average down my price, as well as 2 shares into Royal Dutch Shell (RDS), which they were also on my watch list.

In total, I deployed a total amount of $270.67 and added $14.96 to our forward dividend income, equating to an average dividend yield of 5.52%.

My Wife’s Dividend Stock Purchases

Another new segment!  My wife has an account that we also make dividend stock purchases into.  For some reason, we are still running two separate, individual, taxable accounts.  All is good, especially because we use the same platform. In November, we made quite a few dividend stock purchases for my wife’s account:

We made dividend stock purchases into Cardinal Health (CAH), Smuckers (SJM) and initiated a new position for her/us with Wendy’s (WEN).  Her portfolio is full of safe and sound dividend investments and since we’ve been together, her portfolio has been blossoming into an extremely significant part of our family’s finances.

In total, $1,324.94 was put into investments, producing $37.46 in Dividend Income going forward.  This is an average dividend yield of 2.83%.

Summary & Conclusion

Another solid, consistent month.  Combined, my wife and I deployed a total capital amount of $3,058.51 for November and added $84.92 to our forward dividend income total (2.78% yield overall)!

I will maintain my main message.  Stick to the strategy that works for you, but review if there is anything that may impact your strategy going forward.  You are in control and the emotion button is hard to turn off.  Persevere and stay consistent, if you can and are able to.  I am locked in and ready for further opportunities.  This was one step closer to financial freedom and I hope to continue making strides.  Lastly, my dividend portfolio has been updated.

Were you busy during November?  Strike when the dips happen?  Any dividend stock purchases you were surprised about, based on what you see above?  Please share your thoughts and comments!  Thanks again everyone, and, as always, good luck and happy investing!

-Lanny

16 thoughts on “Lanny’s Dividend Stock Purchase Activity – November 2019

  1. Lanny,
    Strong month there, and I like the shotgun approaches we are starting to see thanks to the lack of fees. CBS is an outlier, but considering its future merger with VIA its probably a good bet.
    Of all the stocks I know that WED would be my wife’s favorite too…
    – Gremlin

    • Gremlin –

      Yep, I figured I’d have people do a double take when they see CBS. Looking forward to that cash flow engine to boom, for sure.

      Also – Can’t go wrong with Wendy’s, except one by my house has a LONG line.. ALWAYS. Love that as a shareholder, though!

      -Lanny

      • It depends. If I buy stocks on our national exchange is 7,5 EUR ( for trades between 0 and 2.500,00 EUR), if I buy stocks on a foreign exchange it goes for 7,5 EUR op to 75 EUR for the same bracket. The 75 EUR is for the really exotic exchange like singapore, hong kong, etc…

        If I would buy in a higher bracket the prices would be a bit higher.

        But the upside is that we maybe don’t get free trades but both brokers I uses have a good platform and costumerservice. Which of course is an upside.

        Because we still have fee’s I always try to make that the tradingcosts are less than 1% of the transaction.

        Cheers,
        TLTI

  2. Hi Lanny,
    I tend to only look at stocks that offer at least a 3% dividend yield. But then again valuation is key and the payout ratio looks pretty good. Will look into CBS and you have given me a new idea to filter for potential candidates. Thanks.

    • DGJ –

      Thank you – I usually do something the same. I had a few lower yielders in the portfolio with high dividend growth. I am looking forward to seeing earnings grow with the acquisition and that should link to growing the dividend!

      -Lanny

  3. Definitely didn’t expect to see CBS come across, but it looks solid even if dividend growth isn’t consistent. November was steady month for us but there weren’t any major purchases. All in all though I’m happy with November and it looks like your purchases were solid by adding nearly $85 to your forward dividends. Keep it up and finish off 2019 on a strong note!

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