As May draws to a close it’s time, once again, to lay out my potential stock picks for the new month. As everyone is already well aware, finding those great values and good yield plays are becoming more scarce and I can honestly say that if the market remains at current levels I am out of ideas for where I’d like to deploy my fresh capital. Of course, this doesn’t mean I won’t be making a buy in June. To the contrary, I plan to make at least one buy each month no matter where the market or individual stocks are. It’s been my mantra to always put money to work each month as I do not pretend to be a market timer and guess when the absolute “best” time to invest is. As a dividend growth investor, the best time to put money to work is right away as it enables the compounding of returns to accumulate.
Looking ahead towards June, I find every holding in my taxable account in the black, which is nice, but given the choice of where I’d like to invest my fresh capital I usually opt to find holdings that are in the red in order to average down my purchase price. It’s not a rule I have, rather a preference. That leaves me with my ROTH account and a large holding in The Bank of Nova Scotia (BNS) and Caterpillar Inc. (CAT), my recent May stock purchase that I would consider for June. Looking at my IRA account I would also consider adding to my HCP, Inc. (HCP) and average down my purchase price there.
So where does that leave me for the month of June? Either pick up some shares in positions that are already growing quite large relative to my other holdings or look elsewhere and build up some of my smaller positions to help even out my dividend income stream. Some of those smaller holdings I’d consider adding to include, W.W. Grainger, Inc. (GWW), Wells Fargo & Company (WFC), V.F. Corporation (VFC) and Abbott Laboratories (ABT).
That being said, this post is contingent on the market remaining around these levels or higher. Of course, if we start to see a noticeable drop in the major averages and individual stocks I have a feeling my choices of where to deploy my fresh capital will become clearer.
What do you think about my potential stock picks for June? Are any of the above names on your monthly watch list? Please let me know below and I welcome any suggestions too.
Disclosure: Long BNS, CAT, HCP, GWW, WFC, VFC, ABT