It turns out that Lanny was not the only one with an itch to buy. I have been watching the market closely over the last few weeks calculating an entry point for one of the stocks on my watch list, WalMart, when another great dividend stock appeared out of nowhere. Just like Lanny, I couldn’t resist purchasing one of the darlings of the dividend growth investing community. This week, I also invested in Kinder Morgan (KMI).
The Purchase & Milestones
As I mentioned in the opening paragraph, I was pretty focused on picking up shares in WalMart up until the end of last week when a few different events happened. Both events played an equal part in my decision to invest in KMI this week. First, Target’s stock price began to stumble at the end of the week’s after their earnings release, similar to WalMart. Why was this important? Because a few months ago I created a list of five stocks that I will always buy and Target made the cut for a variety of reasons. After seeing another retail giant take a step back and become attractively valued, I wanted to slow down and take some extra time to figure out which investment was the best fit for my portfolio. I like both companies, but I still had some extra research to perform and I didn’t want to rush that investment decision. One of my upcoming articles should be an article comparing Target and Walmart and should play a key part in my future investment decision.
Now, to the second event. Well, I’ll be honest, it was more of a series of events that occurred over few day period than any one specific event. On Thursday, I received a text message while I was driving to a client in Pennsylvania from Lanny that just said “KMI.” In typical Lanny fashion, he was vague in any follow-up response and made me wait to figure out what the heck he was talking about. Quick side note, have you noticed over the last few months that many of my stories, investing lessons, or watch lists begin with Lanny sending me a vague text message about a stock. Back to the purchase! Eventually, I was able to access the internet and I quickly learned that KMI announced a larger than expected dividend increase during their last earnings release. KMI was suddenly on my radar again and my interest peeked over the next few days as their price continued to fall. In this time span, Lanny purchased KMI and his article was a huge selling point for me (I won’t go into too much detail in this article since his article was just released) and calmed a lot of the fears I had after reading several negative articles over the weekend. Suddenly, I just couldn’t sit on the sidelines anymore once the stock dipped into the mid-$27 range on Monday. I just had to buy the stock.
On Monday, I purchased 40 shares of KMI, adding $81.60 in forward dividend income to my portfolio. Even though I didn’t knock out any goals with this purchase, this purchase helped me cross some cool portfolio milestones. First, I crossed $2,500 in projected dividend income with this purchase. Boy doesn’t it seem like I just crossed the $2,000 mark yesterday. Time flies! The impact of dividend re-investing plus my crazy third quarter that saw me purchase a lot of stock added up quickly. I’m still short of my goal of my dividend income goal $2,750 by December 31, 2015, but man am I pumped to be over halfway to $3,000. Second, after this purchase and the receipt of KMI’s dividend on 11/13/15, I will own over 100 shares of KMI. This will represent the first individual in my portfolio with a share count in three figures. Now I know it is all relative and the market value and dividend income are more important than total shares. But man is it exciting to see that you own 100 shares of a company. Can’t wait till that day in November so I can cross that mark!
Summary
All in all, this was a very exciting purchase for me. It came out of the blue and I was expecting it, but sometimes you have to make the no brainer investment decision and take the opportunity that is staring you in the face. That’s why I love stock market downturns, they have a knack for creating great opportunities for dividend investors like us. Lanny was instrumental in pushing me to make this purchase and I couldn’t be happier that he convinced me to take this opportunity and run with it. Now, let’s get this KMI dividend engine roaring!
Have you purchased KMI recently? If not, are you looking at other opportunities? Are you concerned about the KMI’s future dividend growth? Would you have invested in WMT or TGT over KMI? Or would you have looked to another one of the four companies on my “Always Buy” list?
Bert