You have to love Mr. Market when the trend turns lower. You have to be prepared, the artillery ready and the decisiveness to your actions. I am so lucky that I was ready last week, especially on Monday the 12th, when the market plunged downward and I had been prepared to make a purchase or two. Those two purchases happened to be Target (TGT) and T. Rowe Price (TROW).
Target Corporation (TGT) Stock Purchase
Have to love the #RedCard with Target (TGT)! From my recent September watch list posted last week, it just so happened to chime well right into my stock purchases. There, I talked about the stock price tanking to $69, and, well, I wanted TGT at a 3.50% yield, which calculated out to be $68.57. I had a limit order set and BAM! The limit order triggered and 25 shares was added to my total pile of TGT stock. If you recall, as well, I need 300 shares of TGT to use their dividends to help pay for the food bill, and oddly enough, this gets me closer, haha! All in all, the quick re-cap of TGT at $68.57: Price to Earnings (P/E) was 13.55, payout ratio at 47%, dividend yield 3.50% and they also have repurchased their shares like crazy.
Though this doesn’t fulfill my – extremely large purchase of $3,000 and up, in order for me to reduce trading costs, but this is quite alright. All in all – the 25 shares purchased costs, as you can see above, a total of $1,721.20. The 25 shares added $60 to my forward income or $15 per quarter going forward. I also now own a total of 106+ shares of TGT that produces a total $256 going forward. Very fortunate and excited for the December dividend, that’s for sure. But wait… I didn’t stop there…
T. Rowe Price (TROW) Stock Purchase
Similarly as mentioned in the watch list article, That price point, at the time, was $67.48 and I set a solid flat limit order of $67.00 or slight 0.7% decline. Also – wanted to see if I could have purchased it before their ex-date. Damn I got lucky. Monday morning this one triggered as well and the $67.00 was hit with another 25 shares added to my T. Rowe Price (TROW) share total! Similar to above, a quick re-cap of TROW at $67.00: Price to Earnings (P/E) was 15.88, payout ratio at 51%, dividend yield 3.22% and they also have been buying back shares consistently.
I essentially split a pot of cash into two stocks, two dividend aristocrats I may add, that were trading, coincidentally, at the same price ranges. The 25 shares cost a total of $1,681.95. The 25 shares added $54 to my forward income or $13.50 per quarter. I now own a total of 72+ shares of TROW that produces a total of $157 going forward. Also – the timing of the purchase allows me to collect the dividend on this purchase in September/3rd quarter as well, not just the 4th quarter like TGT, pumped about how lucky I was with the timing of the limit order to trigger the stock purchase!
Stock purchase summary
Overall, I deployed a total capital amount of $3,403.15, purchased 2 sets of 25 shares and have added $114.00 in dividends on an annual basis. This also helps in adding to the fact my dividend stock portfolio has sky-rocketed over the last few months, and it is so weird/fun/humbling to see this occurring! Very lucky to have been able to purchase two massive dividend aristocrats at the right valuations from the screener being used. I will update my dividend portfolio to reflect this purchases at the beginning of October.
I knew that I had some flack that I wouldn’t be able to buy individual stocks if I was placing more towards my tax-advantaged-strategies. Well, hopefully this shows that it is NOT the case, and I’m still buying stock as I see fit. Lucky that I am able to save such a larger dollar amount to make a stock purchase, or in this case, two. This helps me get closer to the $8,000 project dividend goal as well – as of the close of the week/day of September 17th, I am at a projected dividend income of $7,615! Almost there… trying to knock it down.
What does everyone think of the purchases? Like it or hate it? Would have chosen just 1 instead of both? What are you seeing in the market place? I did see quite a bit more purchases occurring in the dividend community this past week, therefore, similar minds were thinking alike. Excited to read the comments below and don’t hesitate to reach out if there are any other questions or comments you may have, if you don’t want to write below. Thanks again everyone, and happy investing!
-Lanny
Bought TROW on a lmt order @ $69 – great buy.
I’m looking at bank stocks. Higher interest rates should be good for their net interest margin.
*$68 correction
BigAl –
NICE!!! Talk about making moves – but yes, bank stocks have been beaten down for a while. Keep your eyes on Wells Fargo (WFC), as they’ve taken their public criticism and it has impacted their stock a few bucks. Great yield and growth rate.
-Lanny
Bought it at 47. I have lmt orders on TD, ORI, SBSI next. And lower lmts on REITs, I think they are going to get hit once the fed raises.
Another $100 in cash flow, nice! Stocks have certainly come down a bit which has be deciding which one to pull the trigger on. I am limited with cash until I begin work at the end of November so need to get the best bang for my buck.
Stefan –
Thank you, $114** to be exact haha, or almost, ALMOST $10 more per month. Understandable, once you begin work – just start going to town once they hit your range, pumped for you to start swinging the bat more!
-Lanny
Nice pick up with TROW. I just initiated a small position in that a few days ago. It’s not often I add new names to my portfolio but TROW and CAH were two names that I liked in recent days as their prices fell and yields became more attractive. Thanks for sharing.
DivHut –
It’s very funny you bought both of them, as Bert said it – those were our purchases haha. The yields finally came in the range where I liked both of these guys and couldn’t pass it up. Very lucky and happy to have more of both in my portfolio.
-Lanny
I have both company’s on my watchlist, especially TGT. I just did’t have the cash last week to make a purchase.
Div Dolphin –
Thank you for coming by! Gear up that cash – hopefully the market comes back down, as the prices have slightly increased over the last few business days. Appreciate the stop by!
-Lanny
Those are some great additions Lanny. I am glad to see you still being able to buy dividend stocks while using your tax advantaged strategy. Keep up the good work and thanks for sharing.
More Dividends –
Thank you very much, it’s definitely a bit harder, but it is still happening! Saving, saving and saving. Also – the new tax strategies does not hurt as much due to reduction of taxes per pay. Loving it!
-Lanny
Great buys Lanny. I’ve got both on my watchlist.
IH –
Nice! Funny, both are still on my watch list : ) But I got realllllly lucky with T. Rowe’s timing, snatching up two dividends off that purchase – September’s and December’s. Pumped. Keep us posted, of course!
-Lanny
Lanny,
Two awesome buys! Adding another C-note to the yearly dividend totals is super cool!! I own them both and they still seem like fantastic values. Three and a half months to add another $385??? Raises and DRIPs should take care of the first $100. Is is flooding in Ohio? It sounds like someone is “sandbagging” a bit!
MDP
MDP –
Oh no, here we go again – challenging me to increase my goal? Haha. I’m actually at about $7,621 right now and looking at the next 9 days, should end up settling at around, hell, $7,700… I’m playing it steady and if I crush the goal, then hell yeah.
Also – adding a c-note on a purchase is killer, but man, can’t keep pace with you! You’re crushing shit.
-Lanny
Awesome job! that is a great number to add towards your annual dividend income! I always love when the market turns downward and I have a lot of fresh capital to throw in! Those are some solid positions! Keep it up guys.
Diligent Dividend –
Thanks for the comment. It’s sweet when the market turns down, I feel like we’ve been all making moves. Very lucky and fortunate and now excited/eager to collect some divvys!!!
-Lanny
Nice buys Lanny! I thought you’d pick up some T-Rowe. And you guys do love your Target shares, haha. Looking forward to seeing all the extra cash hit your account!
Tristan
Tristan –
Hilarious haha. Yep, had to pick them up and it’s funny, 2 weeks or so after T. Rowe pick up, I’ll be receiving a dividend, I love it when it’s timed like that!
Yes – the big red Target is powerful indeed. They also just announced a $5B share repurchase program, which will truly open up the payout ratio, ability to increase the dividend, as well as increase EPS. Should be fun to see that in play!
-Lanny
Awesome job identifying stocks that you want and pulling the trigger. Right now I’m watching three stocks: CHD, CALM and DIS. Crazy fact CHD has beaten Apple since it IPO’d. I’m hoping for a bit more pullback on these three stocks before I jump in and deploy my capital. But I am getting closer.
Mustard Seed –
Love the name by the way. That’s a very cool fact indeed haha. Disney is always great, as their portfolio of brands, companies and industries they are involved in is very expansive. Good luck and keep us posted!!
-Lanny
Excellent buys. I bought some TGT back when shares were under $67. I’m hoping we see a little more pull back in price so I can increase my position at the end of the month. It’s a three paycheck month for me, would love to put it towards more shares in TGT.
Snc –
Yep, $67 was a great price point at the time, think I even grabbed some back then. Nice that its a 3 paycheck month, should have some nice capital to outlay! Stocks have moved overall slightly up, but I’m hoping for a pullback for you.
-Lanny
Nice purchases Lanny. Both are great value buys and are high on our watch list. In fact, we have a limit order set on TROW price. Hoping to become a fellow shareholder soon! 🙂
Thanks for sharing. Best wishes and continued success! AFFJ
AFFJ –
I will welcome the opportunity : ) I believe your price probably triggered, as they’ve been on the slide this week, falling to low $66 range! Thanks for the post!
-Lanny
Both are solid and probably forever companies. Good job!
BSR –
Appreciate the post! Yes – dividend aristocrats, the names are legendary. T. Rowe has been a very quiet, yet calm investment firm and Target has been that clean retain store. Not too bad and looking forward to seeing what they do in the future. Also – looking forward to December’s dividend from both!
-Lanny
Great picks! I have been watching both TGT and TROW and set my target price to acquire both. I am just waiting for a market hiccup. Fed’s will likely raise interest rates soon. The rumor has already created volatilities. Once the rates are increased (hopefully twice this year). If not, I want to see another interest rate hike in January or February next year.
Er2019
Thank you very much for the comment. Setting limit orders should work well – what price points are you pricing them at? Mine triggered, luckily, last week and it was always a funny thing to see. If rates increase, the market should decrease, unless the market thinks it may be a higher increase than what they do actually increase, than the market may react positively. But hey – we can’t predict that. Let’s roll with what we know, eh?
-Lanny
Hi Lanny,
I usually set a ridiculously low limit price because I don’t want to get surprised with a little negative news on those stocks. If the market crashes (even a flash crash), they might hit the target limit price. I also want to wait till the market corrects itself in the near future and would rather be patient for a while. Otherwise, I watch them every day (but not every minute) and change the target limit price if necessary.
TGT @ 60.00 (Target Yield: 4.00%)
TROW @ 60.00 (Target Yield: 3.60%)
Target just announced a $5B share repurchase program.
Just saw that! I Love it ~12-13% of shares. That’ll help the dividend and share price : )
-Lanny
Lanny,
Very nice, especially a fan of TGT. TROW is nice, but I have a slight glut of financial stocks. Still $114 / year; that’s wroth a lot more than people realize, and with our longer time lines that can grow to be huge.
Gremlin
Gremlin,
Thank you very much. Understandable with the feelings toward financial stocks. I have, I know, a different perspective because I audit these types of companies! Appreciate the post, looking forward to the reinvestment : )
-Lanny
Love TROW, owned it for years. Great dividend and ZERO debt! gotta love a company that doesn’t need to borrow. Good luck!
-Brian
Brian –
Thank you, yes – hands down. If you have no debt, you are set up to survive and persevere through very, very difficult times – as no one else but shareholders are clawing for the company! Additionally – have to love what they did during the great recession. They are a great firm and looking forward to the future.
-Lanny