Recently, I wrote a post about my July stock considerations and was focusing on two sectors I felt represented the best value in the high priced market of the day. The first sector I was considering was the financial sector with AFLAC Inc. (AFL), Wells Fargo & Company (WFC) and U.S. Bancorp (USB) being my top three considerations. It’s no surprise that I really like AFLAC Inc. (AFL). A stock that currently yields 2.30% with a low payout ratio of 23.7% and a very long and generous rising dividend history going back over three decades. With an annualized ten year dividend growth rate of 19.97% and a low PE of 9.7 what’s not to like?
The second area I was considering was the energy sector with BP plc (BP) and Total SA (TOT) being the front-runners I was considering. Both BP and TOT present decent values in the current market, even though BP had a pretty nice recent run up, and great yield which is something every dividend investor seeks. BP and TOT both offer a very generous 4.40% and 4.60% yield respectively.
So, where have I decided to invest in July? The answer… AFL. I guess it’s no surprise I went with AFL. I have been investing in this particular stock since May and personally, find it to provide the best value among all the high multiple stocks out there. AFL’s current PE at only 9.7 is much lower than the S&P, lower than industry peers and lower than its five year average PE. Forward PE is only 9.5 too. To me, as our market keeps marching higher and stocks get more expensive, AFL presented a “reasonable” value to invest.
I added 12.6739 shares at $62.81 for a total investment of $800.00.
I have updated my portfolio to reflect the addition of AFL shares to my brokerage account.
What do you think about my July stock purchase? I may buy more before July is over.