Recent Stock Purchase – August 2015

I can’t believe it’s been almost one full month since my last stock purchase but I guess that’s how it goes sometimes. After a very busy buy month in June with eight separate buys, July was more muted with only two new buys and so far the August tally is one buy. Of course, I am happy with my overall pace. My goal has always been to make at least one buy every month and August is far from over.

 

Looking at my August stock considerations list it was refreshing to highlight a new sector for change in terms of potential buys. As many of us already know, for the last year or so our go to sectors have been energy and finance. These days, though, it seems that value is popping up in the industrial sector as well. Many long time dividend payers and growers are suddenly sporting some pretty decent prices/values as well as attractive yields not seen in a few years. While I still have my eye on Caterpillar Inc. (CAT), Emerson Electric Co. (EMR) and Dover Corporation (DOV) I went with a long time favorite sector of mine, the Canadian banks. With that being said, let’s review my recent stock purchase.

 

I have added to my ROTH account 13.9034 shares at $57.54 for a total investment of $800.00 in Royal Bank of Canada (RY). With this recent purchase my ROTH account holdings in RY now totals 52.8179 shares for a value of $3,044.42.

 

RY, is my smallest of three Canadian bank holdings I have and I simply wanted to take advantage of better pricing, valuation and current yield while averaging down my overall buy price at this time. It’s no secret that I am a fan of the Canadian banks and have been slowly building up my positions in The Toronto-Dominion Bank (TD), The Bank of Nova Scotia (BNS) and Royal Bank of Canada (RY) over the past year.

 

What do you think about my recent buy? The Canadian banks are pretty beat up as of late and offering some pretty attractive, safe, current yields with much better values than in the past. Is this a sector you are buying in August? Please let me know below.

 

Dosclosure: Long TD, BNS, RY, CAT, EMR, DOV

35 thoughts on “Recent Stock Purchase – August 2015

  1. Great purchase, DivHut. You are building up quite a formidable position in the Canadian banks. I have been accumulating as well, but at a slower pace than you. I just own TD and BNS for now and would love to add RY to the mix as well. Their asset management and focus on high net worth individuals makes it a really nice pick that complements the others.

    Congrats on adding more to your div income stream. Keep up the great work!
    R2R
    Roadmap2Retire recently posted…Sector Overview – RailroadsMy Profile

    • Hi R2R,

      As long as the value, yield and decent price remain, the Canadian banks will continue to make my radar screen. As I mentioned in other posts, I’m focusing on my current holdings for the foreseeable future which means I’ll only be adding to my current positions instead of looking for new potential buys. Happy to be a fellow shareholder with you in TD and BNS. I almost bought more TD as well. I like their U.S. exposure. Thank you for stopping by and commenting.

  2. Nice purchase Divhut. I recently bought Royal as well. With the yield nearing 4 percent, its nice to hold and collect divies while e company pushes forward. Glad to be a fellow shareholder. Thank you for sharing.

    • Hi DH,

      I couldn’t agree more. The yield on all five major Canadian banks are at pretty compelling levels which is why TD, BNS and RY will continue to make my radar screen for the foreseeable future. Let’s collect those nice dividends in the meantime. As always, I appreciate your comment.

  3. DivHut,

    I really like the Canadian Banks as well, and I would love to have a piece of each. Scanning the big 5, RY is probably my favorite and the one that I would start a position in tomorrow if I had the means. As for the industrial sector, I do love their valuation. Their value can get bid up pretty rapidly, so I went that way because who knows for how long they will remain depressed in price. Its hard to go wrong heading into the industrial, financial, and select energy companies right now (I just went in on XOM for example).

    – Gremlin

    • Hi DG,

      Industrial, financial and energy names continue to offer us some pretty good reasons to buy. Better prices, lower valuations and significantly higher yield than in recent years. I totally understand your XOM buy at this time. I have yet to jump on board the energy train but I’m sure it will pay off nicely to those that are holding at current levels. For now, I’m looking to add to my current holdings but eventually I’ll be fishing for some new names to add to my portfolio. Thank you for commenting.

  4. Hey DivHut congrats on the purchase!
    Admittedly I don’t have a greatr depth of knowledge on the Canadian banks but if they perform anywhere near as good as the Australian banks have I’m sure you will very happy ! 😀

    • Hi CG,

      I started investing in the Canadian banks about one year ago and their history is pretty compelling. The major Canadian banks all operate as a quasi-monopoly with a lot of government control and back stops in place to prevent meltdowns like we had in the U.S. They also are more conservative in their business practices and have paid dividends uninterrupted for well over 100 years. I realize that history doesn’t guarantee future results but ask any Canadian or even some American bloggers what they think about the Canadian banks and you’ll hear a lot of positive feedback. Thank you for stopping by and commenting.

  5. Good buy DH.

    I’ve been looking into canadian banks for a while but many of them look like falling knives at the moment. BNS just reached its 52 weeks low and still falling. I might jump in after Canada’s next economic report. As for buys I am hoarding up cash for the interest rate fear in September. I can’t wait to buy some cheap consumer staples.

    • All my buys for the last year or two have been “filler buys” while I wait for those consumer staples to drop. Talk about resilience. With all the crap going on in the world, from Ukraine, to Iran, to China to interest rate hike fears to commodity price collapses across the board, the consumer staples, in general, have remained very solid. Of course, the Canadian banks still remain very sound financially and still operate good businesses and with their falling prices, attractive valuations and relatively high current yield they continue to look attractive to me. Plus, I am able to average down my buy price a bit which doesn’t hurt either. As always, I appreciate your input.

  6. Ciao DH,
    I was looking at RY myself, but I have a little concern (being euopean), is the dividend on the NYSE taxed in Canada and in the US? I cannot find this info anywhere, and of course it makes a lot of difference to me as I would get it taxed in Europe as well, that means 3 taxations… a little too much.. Apart from that the stock looks really good!

    Ciao ciao

    Stal

    • Hi Stalflare,

      Canadian stocks have no withholding taxes if held in a retirement account like a ROTH or IRA. This is why I keep all three of my Canadian banks in my ROTH account so I receive the entire dividend and pay no Canadian tax nor U.S. tax. This is because of a treaty between the U.S. and Canada. If you hold the stocks in a regular taxable account then a 15% Canadian withholding tax is taken and you also have to pay a U.S. tax I believe on the dividends. Not sure about any treaties between Canada and European countries. Something similar may exist where you will not be taxed if the stock is held in a European retirement account. Hope this answers your question.

      • Yep it answer the question… No chance for me to go in there… Unfortunately my broker doesn’t have the Canadian market listed, so if I have to go through NYSE i will get triple traxation, and I do not want to set the record for “the most taxed investor” out there 🙂
        I am planning to switch the broker but before, so maybe in the future… Thanks for the reply anyhow!
        Ciao ciao

        Stal

    • Hi R2R,

      Seems like we are being offered lots of better buying opportunities this summer. The Canadian banks continue to get hammered. The energy stocks can’t seem to find a bottom and many industrial plays are falling as China growth fears mount. As long as the dividends are safe and being paid out I’ll be happy to “get paid to wait.” Thank you for commenting.

  7. DivHut,

    Why am I not surprised? Hahaha! Glad you are liking the banks and getting in at an even better price. Even if you only have this one purchase this month, I think it’s great you’re staying focused and forging ahead. Great job!

    – HMB
    HMB recently posted…Stuffing MoneyBags July ’15My Profile

    • Hi HMB,

      I can’t argue with the better value and yield of the Canadian banks these days. While they all seem like falling knives I feel comfortable nibbling on these positions as prices decline. Thank you for stopping by and commenting.

    • Hi LB,

      Thank you for your kind words and support. I have been a dividend growth investor for about eight years and am fully committed to the investment style. I only purchase stocks that pay me to wait and offer safe, reliable and growing dividends. Thank you for commenting.

    • Hi GRB,

      With all the turmoil in the market the last several days we are being offered different buying opportunities than simply energy or financial sector names. Now we have a choice of industrial plays as well as some consumer staples which are also becoming more attractively priced. Of course, with all the headwinds the Canadian economy is facing, their banks continue to look very attractive as well. TD, BNS and RY continue to be on my radar. Thank you for commenting.

    • Hi MB,

      There’s no question that better prices, values and yield are being offered compared to just a month ago. I’m not looking to initiate any new positions to my portfolio at this time rather just add to what I already own. That being said, I still like the Canadian banks going forward as well as a few industrial names like CAT, EMR and DOV. If this market swoon continues I’ll be looking at some consumer staples as well. Thank you for stopping by and commenting.

  8. Lots more value now after the last week and I’m looking forward to making some purchases. Although cash is tight right now with lots of expenses over the last month so I need to do some number crunching before I move forward on any purchases. I’d like to add to my positions in BNS and TD but there’s so many opportunities right now that it’s going to bring up a lot of decision points. First world problems.
    JC @ Passive-Income-Pursuit recently posted…Heavy HeartsMy Profile

    • Hi JC,

      You said it, first world problems. I think we sometimes forget how fortunate we are living in the U.S. After this market swoon It will be interesting to see where our fellow dividend bloggers will be deploying fresh capital. These days we seem to have a lot more opportunities to invest as better prices, value and yield are coming from various sectors. For my money, the Canadian banks still look attractive to me but so does EMR, CAT, DOV and ADM to name a few. As always, I appreciate your comment.

  9. DH, you may have a good opportunity to make your purchases this month! If you have available funds at the moment, there are some good opportunities to lock in good yields at these depressed prices. You’re about the third or fifth one I’ve seen in the last couple weeks who has EMR. I just barely scratched the surface on researching them, but they seem to be a hot pick as of late. I might have to dig into them a little more.

    Anyway, good luck and keep up the good writing!

    -DP
    DP @ Someday Extraordinary recently posted…Like Diamonds, Cycles are Forever – Premature Thoughts on a Stock Market CrashMy Profile

    • Hi DP,

      With the wild ride the stock market has taken these last few days more opportunities to invest are popping up. Names that previously have been too expensive to buy are now sporting much better prices, value and yield and EMR is no exception. This diversified industrial name has been in my portfolio for a long time and I think you are seeing it in many portfolios because it also has a stellar dividend raise history. Glad you enjoy the site. Thank you for commenting.

    • Hi EL,

      Keeping the Canadian banks in a retirement account enables me to receive the whole dividend without any withholding taxes taken. I know that some like to invest solely in taxable accounts but you cannot discount the huge benefit of tax free growth (ROTH) or tax deferred growth (IRA) to make your dividends compound that much faster. EMR, BNS, RY among others are looking mighty tempting to me at this stage and going into September. Thank you for stopping by and commenting.

    • Hi Geblin,

      All solid names on your end. Looks like the market has given us some great buying opportunities in recent weeks. We are seeing many yields well over 3% and 4% for quality dividend paying companies. Thank you for sharing your recent buys.

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