Tuesday, August 25, 2015

Recent Buy: ADM




My war on defensive stock continues. On Tuesday August 25, 2015, I bought 23 shares of ADM at $44.20 per share for a total of $1023.60. 

Fair Market Values
Simply Wall St: $46.3
S&P: $45.9
M*: $44.00

Yield: 2.5%
10 years growth: 12.1%
Payout: 35%

And ADM immediately dropped down to $43.00 at the end of the day. But at least I averaged down on my original purchase. I still have another $1000.00 but I am going to hold off on buying anything else for a while. The market is too uncertain at the moment so I'll take a breather unless we go on another 1000 point crash. 

Who knows, maybe we might have the 1986 crash and lose 25% of our portfolio in a day. I'm already down -$5000 mainly because of oil/commodities. Or if JNJ breaks $80 again I'm jumping in.

My dividends increased by $25.76. My 12 month forward is now $1,875.94 +FCISX payments 

What do you guys think about my buys?

BTW I'm not into politics at all (I don't even vote) but I would vote for Trump just for his hair alone. If he grew a mullet, I'm campaigning. 



Saturday, August 22, 2015

Shopping List

Short correction? Bear Market? Stock market crashing? Who knows. Below is my shopping list. I currently have $2000 saved to spend over the next month. My library no longer carries M*. If you do putting the M* prices in the comment is appreciated.   

Tickers
Simply Wall St Fair Price
S&P fair price
Payout ratio
My Price
KO
$34.42
$32
65.7%
$30
PEP
$79.18
$80.1
61.6%
$75
ADM
$46.30
$45.9
35.2%
$42
JNJ
$101
$95
48.7%
$85
PG
$63.18
$66
67.9%
$60
UL
$33.75
N/A
64%
$30
HSY
$78.71
$84.7
56.2%
$75
PM
$72.65
$78.3
90.3%
$70
MMM
$136
$125.6
52.2%
$120
CAT
$42.94
$79.7
62.2%
$65
EMR
$46.68
$48.2
58%
$40

*I am not an attorney, market researcher, professional accountant, CPA, etc. I'm just some guy on the internet and these are my opinions.

Tuesday, August 11, 2015

SELL: BAX and BXLT; Buy: JNJ and ADM


On August 11, 2015, 

I sold

  1. 52 shares of BAX at 41.9
  2. 52 shares of BXLT at 38.66

I bought 
  1. 21 shares of JNJ at $99.00/share
  2. 45 shares of ADM at $45.90/share

Rationale
  1. I thought I could handle it but I am not a capital gains investor. I don't know when a stock reaches its high and when it becomes a falling knife. 
  2. There is nothing wrong with BAX and BXLT. In fact I would have kept them if my portfolio was more advanced (100k-200k). For me BAX and BXLT are capital gains stock and my stomach and mind can't handle it. I think I finally understand the term sleep well at night. 
I also made a bunch of minibuys in loyal3. I just updated my portfolio. My forward 12 months is currently at $1,830.90. 

Tuesday, August 4, 2015

Recent: A bunch of consumer staples



I have some unexpected cost this month. I have to stretch $1,000 across August.  

August 3, 2015 Loyal3 automatic buys

Starbucks    $10.00   
Kraft Heinz  $17.00
Disney         $10.00
Pepsi           $10.00
Coca-Cola  $10.00
Kellogg's     $10.00
Dr Pepper Snapple    $20.00
Hershey      $20.00
Unilever      $10.00
Wal-Mart   $10.00

August 4th, 2015 Loyal3 buys

Kraft Heinz    $50.00
Pepsi             $50.00
Wal-Mart      $50.00
Hershey         $50.00
Coca-Cola    $50.00
Disney           $50.00

*August 5th, 2015 Loyal3 buy

Disney $100 at $110.63.

Scottrade Flip 

2 shares of MSEX.

Forward 12 month dividends $1,751.26.

*Portfolio Updated. 

Btw I'm holding on to BAX and BXLT. Shire wants BXLT and activists are invading BAX. I'm going into semi-retirement in 14 years (when I'm 40) so I don't mind holding on for a while.   

Saturday, August 1, 2015

July Review: One Step Forward and Two Steps Back. Nobody gets too far like that.



Oi. It has been a rough month. Stock market going crazy and dividends being cut. So many opportunities so little capital.

July’s Dividend

BAX
$27.04
PNY
$4.62
NRZ
$1.35
KO
$13.90
GE
$11.73
LTC
$3.57
HASI
$13.52
WPC
$14.31
DIS
$1.53
KHC
$180.21
PEP
$3.30
FCISX
$23.64

Total: 298.72

KHC special dividend pushed me over the top.

Cash flow


Salary
3219.97
Dividend
292.84
Interest
8.13
Total
3522.94

Deductions


Gas Bill
38.12
Electric bill
162.34
Water Bill
227.29
QT
69.28
Discretionary
14.91
Car payment
435.45
Total
947.39

June+July water bill.

Calculation

% saved
73%


Safety Net Total

Bank
1478.55
Capital One 360
2811.51
Scottrade Tax
36912.25
Scottrade ROTH
1909.31
Loyal3
5819.55
401k
15664.48
Edward Jones Roth
6434.08
Total
71029.73


Dividend Increase/Decrease

  1. OHI increased dividends by 1 cent.
  2. KMI increased dividends by 1 cent.
  3. BXLT increased dividends by 7 cents.
  4. COP increased dividends by 1 cent.
  5. BAX decreased dividends by 40.5 cents.

Summary

  1. BAX dividend cut was painful. I was in the 1800s forward dividends and now back to the 1700s.
    1. New dividend payout ratio is 35% of EPS with estimated EPS growing at 3% per year. It will take a while to get back to the old dividend.
    2. But the company will reinvest more of its profit which will boost stock price.
    3. For the time being BAX will be a capital gains company over a dividend company. I’ll hold for now.

2. Going forward I am focusing on safer stocks. 40% of my portfolio is in cyclical stocks, 34% are in defensive, and the rest in industries. I need to cut my reit consumption and focus on defensive stocks.

3. Puerto Rico just missed their bond payment. Bring your cash. There will be blood.


Question to my readers.  

Would you rather have a stable high paying job with no chance of promotion or take a risk in this economy and take a lower paying job with better chances at promotion?

I was informed last week that there will no longer be any promotion at the DMV. Before it was front desk, senior front desk, and managers. The senior front desk position is being eliminated.

Government work is pretty sweet. It pays a decent wage, lots of overtime, and good benefits. Every 2 years or so we get a 1% pay raise which is more than most Americans. Downside: this job is probably the height of my career if I stay. For those who have worked or is working for government, you know managers are managers for the good part of their lives. 20-30 years. Promotion only occurs at retirement.

On the flip side I could go corporate. I am currently working part time at a telephone company (I’m the guy who schedules your appointments). I was offered a full time position as a phone operator. Benefits are the same and overtime is offered. It pays $5,000 less than my current job but the chance to move up the corporate ladder is phenomenal. Phone operators can become forecasters, in house paralegal, or even members of the board. But again this is corporate. One downturn and I’m fired.

Which would you rather have? The higher paying stable job with no future or the lower paying unstable job with brighter potential?

I am leaning towards the government job.

 
August Watch List
  1. EMR- high $40s-50.
  2. CAT-$75
  3. KO- below $40.5
  4. ADM-$45.5
  5. HSY-below $90
  6. KMI-$34
  7. XOM-$80
  8. O-$45
  9. UNP-$90
  10. NSC-$80

$2000 across 10 stocks. Let’s do this.