Welcome back to Dividend Dollars! Whew what a week!
This week we saw a lot of volatility in the market. The week started rough as expectations of the FOMC meeting mid-week kept investors on their toes. That meeting confirmed the anticipated rate hikes and fight against inflation, with the first increase expected to come in March. Following this, the market showed a little strength followed by further decline on Thursday. Friday ends higher bringing the indexes to slightly positive for the week.
Moving on from the market, every week I write an update on the dividend portfolio as we build it so that we can track its progress. I will give an overview of what the portfolio is invested in, its value, the dividends received, trades made, and any news or business announcements that may be of interest to our positions.
To date, I have invested $5,685 into the account, the total value of all positions plus any cash on hand is $5,963.21. That’s a gain of $278.21 for a total return of 4.89%. The account is up $102.17 for the week which is a 1.74% gain.
We started building this portfolio on 9/27/2021 and have already built into a significant amount of diversity. That diversity has made our portfolio less volatile than the rest of the market, so we did not end the week as high as some of the indexes did.
We added $165 to the account this week. A significant chunk of that money added was put towards adding to positions in Best Buy and Allstate as you will see further down.
Above is a dashboard of the portfolio as tracked through simplysafedividends.com. I use that site for tracking forecasted dividend income, yield, annual income, beta, dividend growth, and more.
Below is a table of everything we are invested in so far. There you can see my number of shares, shares bought through dividend reinvestments, average cost, gains, and more. The tickers in green are positions that I bought shares in this week. Usually, a chunk of my buys throughout the week are buys from my monthly stock picks. You can read about January’s stock picks here. I use a stock screener to find potentially undervalued stocks with safe and growing dividends. All stock picks (for this month and previous months) are highlighted in blue.
This week our activity lowered our annual dividend income by $2. I did some reorganizing and liquidated a position in favor of building others, this lowered out annual income but raised our forecasted income significantly due to better growth. Our dividend yield decreased by 0.12% and our beta went up by 0.01. My portfolio’s dividend yield may be just slightly higher than you will see in other portfolios, however that is strategic per my time horizon. I am in my 20s and am just starting off this investment journey, so a higher dividend yield gives me greater cash flow now to reinvest which help me realize the benefits of compounding sooner. Our beta usually hovers right around the mid 0.6s which I like, especially in times of uneasiness. It means my portfolio won’t dip as much as the rest of the market on red days, however, it does go the other way around and I won’t have as much green on the good days. Therefore, it is good to watch your beta in terms of cyclicity.
This week we received dividends from CMCSA for $0.25 and from EOG for $2.30.
Dividends received for January 2022: $18.66
Year-To-Date Dividends: $41.59
This week many of our positions announced next dividends and a couple of them showed increases.
- SJM announced their next dividend of $0.99 with no change.
- XYLD announced their next variable dividend of $0.4808.
- INTC announced a 5% increase to a dividend of $0.365.
- CVX announced a 6% increase to a dividend of $1.42.
- MMP announced their next dividend of $1.0375 with no change.
- CMCSA announced a 8% increase to a dividend of $0.27.
Here’s the breakdown of the trades I made this week:
- January 25th
- MFA – sold 26 shares at $4.31.
- BBY – added 1 share at $98.11
- ALL – added 0.5 shares at $119.32
- January 26th
- XYLD – added 0.208013 shares at $48.07 (recurring investment)
- SCHD – added 0.127944 shares at $78.16 (recurring investment)
- CMCSA – $0.25 dividend reinvested at $45.55
- January 27th
- CMCSA – Added 1 share at $47.06
- INTC – added 1 share at $48.11
This section of the post will identify some headlines that may be of import to our positions. If they are important enough, we will also call out in the posts if the news calls for actions to readjust our portfolio.
Other than just the general state of the market I have a few updates for us.
Lots of our positions had earnings reports this week. I will give a brief summary of each below:
- CMCSA: Peacock has increased their monthly active users to 24.5 million, Comcast projects this to 35 million by 2024. Comcast outperformed expectations. They reported $0.77 earnings per share on $30.336 billion in revenue beating EPS expectations by 4 cents. This earnings is up 37.5% from Q4 of 2020. NBCU revenue jumped 25.6% and the media segment jumped 8.4% despite a $559 million loss related to Peacock. Peacock lost $1.7 billion in 2021. Other segments of business such as theme parks and Universal performed well. Looking ahead, Comcast states they will remain focused on organic growth opportunities and increasing the capacity of their network and broad-band experience by producing more premium content with multiple ways of accessing it and expanding the reach of their technology platforms. They are confident in increasing the dividend for the 14th consecutive year.
- MO: Altria’s earning release matched up with expectations. EPS came in at $1.09 which increased 10.1% year over year. Net revenues dipped 0.8% to $6.25 billion due to lacking performance in the wine segment as a result of the timing of the wine business sale. Revenues were up 0.6% after deducting excise tax. Smokeable and Oral products experienced net revenue gains. For the year of 2021, MO bought back 35.7 million shares which is about half way through their buy back plan expecting to end by December of 2022. Expectations for 2022 are looking to be stable.
- INTC: Intel posted record 4Q earnings but forecasted 1Q earnings to be short of expectations due to supply chain issues. Shares fell about 3% following the earnings. 1Q EPS is projected to be $0.80 compared to the expected $0.86. Gross margin forecast fell to 52%, still within the previously expected range. Gross margin is under pressure due to the high capital expenditures Intel is pursuing, these expenditures show the company is building operations needed in order to meet better positions themselves to meet strong demand for semiconductors.
- MKC: MCK’s 4Q earnings beat most estimates. EPS rose 6% to $0.84. Sales are up 11% for the year. Sales from Cholula and FONA (both new acquisitions in 2020) contributed 4% to this upside. Both consumer and flavor solution segments experienced an increase in sales. The company is expecting 3-5% sales growth for 2022 with the growth being led by new products.
That is it for the update this week. Let’s kill it next week. Stay patient and stable. Don’t let this market scare you. Be ready to buy income producing assets at a discount!
Let me know what you think of the progress so far, share with me your progress and questions, interact with me on twitter and Instagram using the links below!
Thank you for reading! See you next week!