Without trying to sound too cliché about how fast time goes by, I cannot believe that a whole month of 2017 is already in the books. Of course, with a new month upon us it is time, once again, for me to lay out some of my stock considerations for the next several weeks. The point of these posts is to help take some of the guesswork out of where I plan to allocate my fresh capital going forward. By making my selections ahead of time I find it easier to commit to buys as all the homework and investment theses have already been completed on my end. All that’s left to do is pull the ‘buy’ trigger. Of course, I always qualify these posts with the notion that Mr. Market may present new buying opportunities not mentioned here, and with all the volatility we have been witnessing recently it’s a definite possibility that some new stock buying opportunity will pop up. With that being said, let’s take a look at my February stock considerations.
After highlighting two specific sectors in my January considerations post I feel that not much has changed going into February. I basically considered consumer oriented stocks and the health REITs last month and feel ready to continue making buys in one or both of those sectors. Names that I am considering in the consumer space include Unilever PLC (UL), The Coca-Cola Company (KO), Kimberly-Clark Corporation (KMB), The Procter & Gamble Company (PG), General Mills, Inc. (GIS), Diageo plc (DEO) and V.F. Corporation (VFC). Each of these dividend stalwarts currently have safe dividend yields well north of 3% and would continue to make great long term holdings.
Looking at the health REITs I continue to consider HCP, Inc. (HCP), Welltower Inc. (HCN), Care Capital Properties, Inc. (CCP) and a potential new pick from my watch list, LTC Properties, Inc. (LTC). These stocks come with slightly higher risk than the “standard” dividend growth stocks mentioned earlier but do offer much higher yield all around for that added risk. We all know that a rising interest rate environment can create challenges for REITs but I would imagine the additional financing costs would be passed along to the end consumer and while the sector (health REIT) may face near and mid term headwinds over the long haul they are operating with a huge aging population tailwind.
Besides the many names I listed above I want to mention some new names that I have not considered last month and are also increasingly looking more attractive. First, in the financial sector T. Rowe Price Group, Inc. (TROW) is offering us a much better price value and yield compared to just a couple weeks ago. While a very small position in my portfolio, I wouldn’t mind adding a bit more to this stock.
Finally, I am considering the utilities in the month of February. In order of preference, I am looking to add to my holdings in Dominion Resources, Inc. (D), The Southern Company (SO) and Consolidated Edison, Inc. (ED).
So there you have it. My February 2017 stock considerations. What stocks are you considering this month? Are any of the above names I’m considering making your top picks? Please let me know below.
Disclosure: Long UL, KO, KMB, PG, GIS, DEO, VFC, HCP, HCN, CCP, TROW, D, SO, ED