Recent Stock Purchase II March 2017

Well that didn’t take too long. After a full month of not buying any stock since the middle of February I have already completed my second tranche of buys in the month of March. As you already know I have been nibbling in the health REIT sector with my recent pick up of Care Capital Properties, Inc. (CCP) and a new position in LTC Properties, Inc. (LTC) as well. I’ll continue to look at this sector as it remains beaten down and is offering up better prices, values and yields when compared to their summertime highs reached in 2016. Of course, I do like other names not in the health sector and felt compelled to branch out a bit this month with two additional buys. Sticking to my March 2017 Stock Considerations:

 

I have added to my taxable account 26.9225 shares at $40.86 for a total investment of $1100.05 in Johnson Controls International plc (JCI). With this recent purchase my taxable account holdings in JCI now totals 93.8926 shares with a market value of $3,921.89. On a side note, recent JCI spin off, Adient plc (ADNT) just announced that it will pay its first dividend to shareholders with an expected yield of 1.48%. You just have to love it when a spin off in your portfolio also becomes a dividend payer.

 

I also initiated a new position in my taxable account adding 14.3651 shares at $34.81 for a total investment of $500.05 in Hormel Foods Corporation (HRL). HRL has been a stock on my watch list for a long time and I finally decided to nibble a bit on this dividend stalwart. Of course, HRL is in one of my all time favorite sectors to invest in, the consumer staples, and like many other “old guard” food companies is adapting to the changing consumer tastes and preferences via strategic acquisitions. While not the highest yielding company in the field it does sport a safe and growing dividend that should continue for many years to come.

 

What do you think about my recent buys? Are you also looking at the consumer staples or other consumer related stocks? Does JCI or another industrial company look enticing? Please let me know below.

 

Disclosure: Long CCP, LTC, JCI, ADNT, HRL

36 thoughts on “Recent Stock Purchase II March 2017

  1. Speaking of spinoff companies and dividends I keep waiting from YUMC and VSM to announce their first dividends, but that’s still yet to come. I’m not a big fan of HRL but maybe I need to take a closer look. I know they have a lot of processed foods that I think the trend for those is negative over the years. However, if I remember correctly they have plenty of cash flow to allow them to make strategic acquisitions. Your consistency with purchases is truly amazing every couple weeks another $1000 here, $1000 there. It might not seem like it’s doing much in the short term but when you look back at it after a 6 months or a year those consistent monthly purchases really add up. Hope you have a great weekend.
    JC recently posted…Dividend Growth Investing at Work – Realty Income to the RescueMy Profile

    • Hi JC,

      I totally hear you about YUMC and VSM. I also hold the KMB spin off HYH and HCP spin off QCP that pay zero in dividends. At this point I’d settle for a 0.5% yield coming from them. Anything really. You could understand my excitement when I read that ADNT will start paying now. It kind of sucks seeing money sitting in your account that literally brings in zero income. I’ll continue to hold for now but may lose patience if they don’t start contributing to my passive income stream. I’m guessing you’ll continue to hold too. HRL is what I call an “old guard” food company that does sell a lot of products that are not “with the times.” However, as MCD is continuing to adapt, GIS as well, HRL is doing the same by recently acquiring Applegate: Natural and Organic Meat, Justin’s: Natural and Organic Nut Butters, Muscle Milk: Protein Shakes and JENNIE-O® Turkey among others. While HRL is synonymous with SPAM and other processed foods it is shifting to more natural and organic offerings. The dividend still appears to be very safe with lots of room for growth as well. I doubt I’ll ever make HRL a huge part of my portfolio but I think it does deserve some space among my holdings. Thank you for your continued support. As dividend growth investors we must always be buying every month. It doesn’t matter if it’s large or small quantities, the key is to be consistent!

    • Hi DD,

      Glad these updates can get you excited. I feel the same way whenever I read about others making buys, especially these days when value and good yield is harder to come by and the markets are treading nosebleed territories. You should already know by now that I’ll always be making at least one buy every month. Large or small, I will be buying no matter where the market is or the overall economy. As always, I appreciate your comment.

    • Hi DC,

      I totally agree. Staying consistent with your buys is one of the key elements to being a successful long term dividend growth investor. Believe me, I’m also happy to read when others post their buys online. HRL is a great long term dividend payer and raiser and is slowly shifting from the processed “uncool” meats and foods to more organic and natural offerings via acquisitions. Companies like Applegate: Natural and Organic Meat, Justin’s: Natural and Organic Nut Butters, Muscle Milk: Protein Shakes and JENNIE-O® Turkey among others now complement HRL’s SPAM offerings. Thank you for commenting.

    • Hi DD,

      Last week I bought a couple health REITs but, like you, I’d like to see even more headwinds in the health space to bring JNJ, BDX, CAH, ABT, ABBV and others back down to Earth a bit. I’ll be watching and if a good opportunity pops up I won’t hesitate to add to my positions in the health sector. Thank you for stopping by and commenting.

    • Hi DI,

      I agree that it’s pretty difficult to find decently valued stocks with attractive yields these days but there are some good relative values out there still. Not every sector/stock has participated in the recent market rally. I still think one can nibble on some positions here and there even during these high market times. Thank you for sharing your thoughts.

  2. I’m liking that we have someone talking about REIT’s also. It’s nice to see some diversification in other form of securities aside from the usual blue chips dividend paying stocks. Healthcare REITS is something I’m looking into also. Heck, and REITS generally. One area I’m seeing in REITS as being really unfavorable is REITS in the retail space.

    Looks like it’s a reflection of what’s going on in the brick n mortar retail space as Online Shopping continues to hurt the retail sector.
    Micro Dividends recently posted…17 March 2017 – M, MMT, AMGN, GOOD, JCI, VGR, DAL, FLO, NAVIMy Profile

    • Hi MD,

      The REITs, in general, have all been taking a licking for many months now and are sporting much better prices, values and yields these days. I still see a lot of headwinds for the sector in the near to mid term which should only continue to present us with better buying opportunities for a while. Of course, I’ll be happy in the meantime collecting those distributions. There’s no guarantee with any investment we make. Just stay diversified, stick to solid names and ride out any near term weakness. As you mentioned, the REITs might also be reflecting what’s going on in the retail sector as well. The market may be at all time highs but certain stocks and sectors still look quite weak. Thank you for commenting.

  3. Hi Keith,

    It sure is hard these days to find those those bargains out there.. All your purchases are on my watch list as I head for my 100 stock portfolio I started from scratch in early 2016. As I and Mrs MDP paid off the house last year, we have been full steam ahead in putting money in the market. As a 60 + year old converted DGI investor, and having to learn from the wonderful DGI bloggers who post their portfolio’s and their thoughts behind their purchases,their recommendations, and
    links to great articles, I finally feel comfortable in posting here.

    I have 5 years left to create a $500K DGI portfolio and could not do it without the DGI blogosphere helping steer me in the right direction.

    One thing I have learned, is that one must commit capital after they do their Do Diligence no matter what the level of the market is. Case in point. I bought Texas Instruments the other day even tho it was near its 52 week high. Dividend growth rate is astounding. Also bought TD with the 5 % drop and started a nice position. I then bought First American Financial ( FAF ) with the reports of housing supply in demand. They primarily underwrite title insurance and I expect them to soar on earnings this year. And they have a great CAGR on the div.

    Just some ideas I wanted to share today.

    I am not much of a writer on my blog, just post updates on portfolio, buys, and div income.

    Keep up the great work!!

    Jim – MDP

    • Hi Jim,

      Glad to hear that our collective dividend investing blogs continue to give you inspiration for your own income generating portfolio. While I agree with you that it is not easy finding bargains these days, they do exist, at least on a relative basis. Your comment also highlights one of my investing mantras which is to always be consistent with my buying no matter where the market is nor the general economy. By always making buys you enable dollar cost averaging to smooth out any extreme highs or lows in prices that you might have paid. I think too many people try to time the market and sit on the sidelines with piles of cash for an indefinite amount of time. The goal of being a dividend growth investor is to create an ever increasing passive income stream foremost leaving capital appreciation or loss as a secondary concern. Thank you for your kind words and also for sharing your ideas.

    • Hi BHL,

      As long as you are able to put some money to work every month I wouldn’t worry too much if you don’t make another buy till April. My goal is to make at least one buy each month and I’m happy. Glad you liked my recent purchases. Unless there is a major drop in the market or a specific stock I have my eye on I’m most likely done for this month in terms of new buys. As always, I appreciate your comment.

  4. Nothing wrong with increasing your number of shares and diversifying into a new industry such as the health sector REITs. Although I would have personally chosen different stocks, what’s important is that you’re making thoughtful and well researched decisions regarding the choosing of your stocks. I need to learn a thing or two from you.
    Data Lore recently posted…The Perfect BrokerMy Profile

    • Hi DL,

      I appreciate your words with respect to my recent buys. For now, with real good bargains much harder to come by, I’ll be focusing on the health REITs as they remain beaten down and will look to add to my existing positions elsewhere as better values and yields present themselves. Unless we see a major pullback in the next couple of weeks I doubt I’ll be buying any more this month. Thank you for stopping by and commenting.

    • Hi IH,

      It would be nice to have you as a fellow HRL shareholder. It’s such a solid company and stock making many good moves in recent times to adapt to the changing consumer tastes and demands by acquiring Applegate: Natural and Organic Meat, Justin’s: Natural and Organic Nut Butters, Muscle Milk: Protein Shakes and JENNIE-O® Turkey among others. While HRL is synonymous with SPAM and other processed foods it is shifting to more natural and organic offerings. Plus, that dividend growth rate and payout ratio look pretty amazing. Thank you for commenting.

  5. Nice buys. I don’t know yo much on the u.s side of things but am currently looking to diversify a little more. I’ve seen a couple sites talking about hormel lately. I didn’t know what brands it really sold until reading comments. Lol spam. A classic!
    Cheers
    Passivecanadianincome recently posted…Back In TimeMy Profile

    • Hi Passivecanadianincome,

      I think you are seeing a lot of chatter about HRL in recent weeks because it’s yield has jumped to the higher side of the spectrum when the stock price dropped after a bad earnings report mainly due to low turkey prices. HRL is a classic dividend growth stock that has a very long history of raising dividends as well as capital appreciation. While it’s known mostly for SPAM and other processed meats, (a food category that’s not really popular these days) it does also own many health conscious brands via acquisitions made in recent years. Some of those include, Applegate: Natural and Organic Meat, Justin’s: Natural and Organic Nut Butters, Muscle Milk: Protein Shakes and JENNIE-O® Turkey among others. Thank you for sharing your thoughts.

    • Hi MSM,

      I’ve had HRL on my watch list forever. I’m glad I finally decided to pull the trigger on this solid company/stock. Quite honestly, the low current yield kept me away for a while even though the company was growing its (safe) dividend at a nice clip and the stock was climbing higher and higher. Finally, as the yield approached 2% I took the plunge. JCI is one of my older holdings. It’s been in my portfolio since 2007 and now with its spin off paying a dividend as well I will continue to hold both for the foreseeable future. Thank you for commenting.

  6. DivHut,

    I like JCI – almost a mini-me 3M. I know from second hand reviews, their stuff performs fairly well too. HRL is a nice start. I know it was mentioned above they have a lot of processed foods, but they also have the ability to change the ingredients and get new acquisitions. They are in a position of strength and should be fairly adaptable.

    Enjoy the income snack.

    – Gremlin
    Dividend Gremlin recently posted…February Review / March Preview, 2017My Profile

    • Hi DG,

      JCI has been a solid performer for me for many years. Still not sure why it’s not found in more DGI portfolios. I’m happy their recent spin off will be paying a dividend soon. Spin offs are great but kind of a let down when those new shares don’t pay a dividend. I’m also not sure why more people don’t like HRL long term. Sure, it’s an “old guard” food company that’s known for SPAM and other processed meat but it has been making many right moves in recent years adapting to changing consumer tastes with companies like Applegate: Natural and Organic Meat, Justin’s: Natural and Organic Nut Butters, Muscle Milk: Protein Shakes and JENNIE-O® Turkey among others. People thought MCD was dead a few years ago too when it was considered out of touch with consumer tastes. It was all about CMG and PNRA killing MCD. How times have changed. Same with GIS buying Annie’s, Lärabar, Cascadian Farm and other natural and organic food makers. You don’t exist for over 100 years without adapting and I’m sure HRL sees the future. Thank you for commenting.

  7. Always good news when a spin starts to pay a dividend. With 3M in my portfolio, I was happy to see them acquire Scott Safety from JCI. The only concern I would have with CCP is the exposure levels of their operators to Medicare and Medicaid.

    • Hi Charlie,

      CCP is kind of my wild card these days. It entered my portfolio via the VTR spin off and I felt comfortable nibbling a bit more as the dividend still appears to be quite safe even with that high yield. It won’t ever be a large position in my portfolio but still deserves a spot. Rising interest rates and government uncertainty is giving us better buying opportunities in the health REIT space. Buy when no one else wants the stock. Right? As always, I appreciate your comment.

    • Hi MR,

      HRL is a name that has become quite popular after their recent earnings miss because of low turkey prices. It’s a stock with a solid dividend track record and has plenty of room to continue growing that dividend for years to come. I’ll be watching that name too and if I see a yield of 2% or more I’ll be a buyer. Thank you for commenting.

    • Hi MGUK,

      Thanks for that vote of confidence with my recent buys. JCI has been in my portfolio for many, many years and I plan to keep holding it along with ADNT now that it too will be paying a dividend. HRL is my newest addition to my portfolio and while I don’t plan to make it a large position overall I do plan to hold it for a long time. As always, I appreciate your comment.

  8. Looks like I’m going to make you rich. I love Hormel’s ‘Corned Beef,’ ‘Pepperoni,’ and ‘Corned Beef Hash.’ I hope you don’t mind, but I think I’m going to use your (HRL) idea for my next YouTube vid. I don’t know if you’ve noticed, but I also recently posted an (LTC) YouTube vid to my Twitter feed. You might want to check it out. Many happy returns!

    • Hi Lee,

      Think of DivHut the next time you prepare that HRL corned beef 🙂 I thank you for your support. In our home it’s all about Skippy in a big way. Come to think of it, I never liked the idea of buying jar after jar of Skippy and not getting anything back. Now, at least a few dollars can flow in for all that peanut butter we buy. Besides for their processed meats and peanut butter, HRL is moving in another direction with more healthy and organic offerings which is partly why I initiated a position this time around. Thank you for sharing your thoughts.

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