Recent Stock Purchase June 2017

It’s been almost a full month since my last recent stock purchase was made which just highlights my frustration in June for finding places to deploy my fresh capital. While the stock market continues to melt up seemingly every week taking many of my holdings up with it, finding good to decent value is becoming increasingly difficult.

 

The last several months have seen me add to my existing positions in companies that have been faltering as of late, you all know the names, General Mills, Inc. (GIS), Hormel Foods Corporation (HRL), W.W. Grainger, Inc. (GWW), Bemis Company, Inc. (BMS), even health REITs Care Capital Properties, Inc. (CCP) and LTC Properties, Inc. (LTC) among others. This month, instead of adding to my existing positions I decided to initiate new positions, all in the health sector, to a) boost my overall exposure to the sector and b) further diversify my overall portfolio. With that being said:

 

I have added to my taxable account 16.0 shares at $32.58 for a total investment of $521.28 in Teva Pharmaceutical Industries Limited (TEVA). This stock has really been under the gun as of late as a recent buying spree for the company has greatly increased its debt load. That being said, its recent acquisition of generic drug maker Actavis now makes TEVA the largest generic pharma company in the world which should play out well in the coming years. Even with an Israeli withholding tax that can be as high as 25% (there are varying withholding rates), TEVA still offers a pretty juicy and safe current yield. This is a new position and was a commission free trade.

 

I have added to my taxable account 2.0 shares at $171.61 for a total investment of $343.22 in Amgen Inc. (AMGN). This is a new position and was a commission free trade.

 

I have added to my taxable account 5.0 shares at $69.98 for a total investment of $349.90 in Gilead Sciences, Inc. (GILD). This is a new position and was a commission free trade.

 

I have added to my taxable account 11.0 shares at $34.10 for a total investment of $375.10 in Pfizer Inc. (PFE). This is a new position and was a commission free trade.

 

In all, I have added $1,589.50 in fresh capital this month. These four new positions will slowly afford me further diversification among my health sector holdings. Of course, it doesn’t hurt that Morningstar rates each of these stocks four stars. On the whole, I don’t expect any of these four positions to ever become “overweight” in my portfolio as I plan to keep Johnson & Johnson (JNJ), Abbott Laboratories (ABT), AbbVie Inc. (ABBV), Cardinal Health, Inc. (CAH) and Becton, Dickinson and Company (BDX) doing most of the “heavy dividend lifting.” As my portfolio and dividend income continues to grow I begin to think about my overall “dividend reliability” where I want to adequately protect my passive income stream from potential dividend cuts or eliminations. The only way I can see that to fruition is to further diversify my holdings away from my larger positions. Don’t get me wrong, if I see a day when JNJ, ABBV, MCD, CL, UL, KMB, PEP or any other high flying name falter I’ll gladly add to those holdings but in the meantime I’ll initiate several new small positions in my portfolio.

 

So far, June has been a total departure from my monthly stock considerations watch list. As many of you know, I have a long term horizon and continue to make purchases every month no matter where we are in a market or economic cycle. I don’t pretend to know where the market or any stock will be in the short term so all I can do in the meantime is remain consistent with my investments, diversify and buy on weakness as those opportunities present themselves. What do you think about my recent buys? Are any of the names mentioned on your watch list? Please let me know below.

 

Disclosure: Long GIS, HRL, GWW, BMS, CCP, LTC, TEVA, AMGN, GILD, PFE, JNJ, ABT, ABBV, CAH, BDX, MCD, CL, UL, KMB, PEP

49 thoughts on “Recent Stock Purchase June 2017

  1. Lots of activity for you. Will add a lot of passive income. Was looking at GILD and PFE. Loving my CAH buy when they dipped last. I really want to buy ABBV but the price just keeps going higher. Makes it hard to initiate a new position with them. But what goes up must come down eventually, even if temporarily. Keep making these quality buys!
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    • Hi DD,

      It was a busy buy day. I never bought four different stocks in one day before but as you can see each was a relatively small amount. Like you, I also added to my CAH after their dip. I love buying quality names when they go on sale. Keep watching ABBV and others in the health space. These stocks are all highly sensitive to headlines and Washington politics which can cause them to fly or dive on a dime. As always, I appreciate your comment.

  2. Div Hut, I used to own PFE in my portfolio a long time ago, before I liquidated all my assets. I wasn’t happy that PFE cut it’s dividend in 2009, but I nonetheless feel the company has strong fundamentals. I’m considering adding it to my portfolio as well.

    I’m not familiar with the other stocks that form the basis of your recent additions, but it’s usually not a bad idea to diversify and protect your assets.
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    • Hi DP,

      I can understand you dumping your PFE shares after their cut in 2009. Many in the DGI space have a rule about selling dividend cutters. At current levels PFE can be viewed as slightly undervalued based on future cash flow projections which is why I decided to nibble here and further diversify my health sector holdings. Thank you for sharing your thoughts.

    • Hi DD,

      Curve balls indeed. See, I’m open to new stocks and ideas. I know I hold zero tech and zero energy but I’m still open to buying some for my portfolio. No doubt these recent buys are a bit outside my wheelhouse but all four presented pretty good buying opportunities at these levels and further diversified my passive income stream. I’m still watching my old time favorites like GIS, VFC, GWW and others but will wait for much lower prices before I add to those names again. It was time to ‘spread my wings’ a bit. As always, I appreciate your comment.

    • Hi desidividend,

      Happy to finally be on board the GILD train. I had GILD and AMGN on my watch list for at least a couple years, if not longer. Looks like you picked up some hot names too. I have added to my GWW on more than one occasion the past several months. It was time for a change which is why I went pharma/biotech this month. Thank you for stopping by and commenting.

  3. nice adds. diversification is key. Jealous of your abbvie, id love to start a position there but the price keeps shooting up. Probably because its the only dope stock with a dividend (altho its a synthetic dope……)
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    • Hi passivecanadianincome,

      Thanks for that vote of confidence with my buys. These stocks are all highly sensitive to headlines and Washington politics. I’m sure there will be opportunities to buy ABBV or other health stocks down the road at much better prices. Thank you for commenting.

  4. Good add DH. So far this week I’ve beaten the S&P 500 by a ratio of 8 to 1 because of all my pharma and hospital stocks. TEVA is a big risk because of it’s debt but it has a crazy amount of generics in the pipeline and with the new EO coming out to push for biosimilars TEVA is about to go insane. keep up the good work

    • Hi tbdi,

      That’s awesome that you have been on such a hot streak with your portfolio. No doubt the pharma/biotech space has been super hot last week with JNJ, ABT, ABBV and others hitting all time highs. I understand the TEVA risks but think down the road they’ll be fine after all their acquisitions start contributing to their bottom line. As of today, TEVA is the largest generic drug maker in the world with a broad pipeline of generics in market or coming to market. Thank you for sharing your thoughts.

  5. Hi, DivHut

    Some good buys there and it is good to add new positions to diversify more. Of your new positions, I own GILD and PFE. (I recently added to my GILD position). Of your existing health care stocks, I own JNJ and ABBV.

    All the best with these investments and thanks for sharing!

    • Hi FerdiS,

      Happy to see that we hold quite a few names in common in the health space. Believe me, I really wanted to add to my existing holdings in June but found it difficult to make another GIS or VFC buy as those positions are already becoming large. Of course, if they fall much further I’d gladly add to those names but not at current levels which brought me to the pharma/biotech space instead. Thank you for stopping by and commenting.

    • Hi At,

      A very good question and difficult to answer with any long term accuracy. I can tell you that for now I am happy with about 60 individual holdings and don’t plan to add any more new stocks to my portfolio. Of course, should we see that correction we’re all waiting for, it might trigger some new additions. Going forward I plan to slowly build up my smaller ‘support’ stock holdings to closely match my individual ‘core’ holdings income generation. As always, I appreciate your comment.

    • Hi Jay,

      GILD has been on a steady decline for a while now and last week saw a huge jump in share price. I should have pulled the trigger earlier in the week as I just watched it go up and up and up. I’m not sure what will happen in the near term but if a considerable price swoon does occur I’d gladly add more to my position. Thank you for stopping by and commenting.

    • Hi AFFJ,

      GILD had an incredible run up last week and I wish I had bought a little earlier but even at current levels the stock looks compelling. The dividend certainly looks very safe and I felt comfortable starting a small position at these levels. Of course, these are the names I’ll be watching closely in the beginning to see if any price swoons occur which would allow me to average down in price. Thank you for commenting.

    • Hi Roadrunner,

      With these recent buys it was all about pharma. I guess it was the one aspect of my health sector holdings that I lacked. No doubt there are risks with each of these names especially the biotechs that I added. PFE still looks good at these levels and can be considered undervalued based on future cash flow projections with a juicy yield that appears to be safe going forward. I think there’s a reason the dividend is yielding 3.75% to mitigate any potential risk in owning these shares. I use Morningstar, Finbox.io and Simply Wall St. to aid in my decision process. As always, I appreciate your comment.

  6. Nice buys I also added TEVA to my portfolio. I finally broke the 500.00 in dividend income for the first time ever this month. I also did not add to existing positions but I find that I now have almost 100 different stocks do you consider that being overly diversified.

    • Hi Wayne,

      TEVA has been a generic leader for many, many years and has really come under fire the last year or so. I realize there are risks with its high debt load after many recent acquisitions but think they’ll do fine down the road. Of course, that being said I don’t plan to make TEVA a ‘core’ holding rather a smaller support position in my health sector. Congrats on cracking the $500 mark for passive income. It’s always a good feeling reaching certain milestones. Regarding diversification it really comes down to your personal preference. Personally, I don’t think I’ll ever reach 100 individual holdings in my portfolio but I have seen it grow simply from stock spin offs that I haven’t sold like ABBV, ADNT, ALLE, HYH, VSM, YUMC, CCP and QCP. Even if you never buy another new stock your portfolio can still grow and diversify. With these new additions to my portfolio I now have about 60 holdings. That should suffice for now though I still have names on my watch list that I might add one day. As I mentioned in the post I really want to further diversify my dividend income so as to not become too dependent on just a handful of stocks for the majority of my income. Sure, some stocks will always produce more than others as I’ll have ‘core’ holdings and ‘support’ but it’s having multiple support stocks that can ease a blow of a potential dividend cut or elimination from my core. Thank you for sharing your thoughts.

        • Hi Wayne,

          Getting to $1k a month average is also my next long term goal. I still have a while to go but I do see it in sight. One can’t discount the AMZN threat but in the near term I don’t see much impact from the behemoth. There is a lot more hype and ‘sexy’ headline noise about AMZN disrupting traditional businesses than is actually happening. Even with the recent WFM announcement, should the deal actually go through, the combined AMZN/WFM grocery footprint will be a tiny, tiny fraction of the industry. As a whole, it’s still dominated by WMT, KR and the like. Same goes for VFC and other fashion related companies. I do see AMZN impacting O and real retail real estate much more though, and, longer term its power should only grow as we continue to shift to an online world so I’m not discounting the potential of AMZN. I just question the near term headline noise which is what seems to drive stock prices up or down. If you simply look at WMT revenue and profits you’ll see it blows AMZN out of the water by a mile. Of course, the headlines and stock price might have you believe otherwise. Sometimes, there is a disconnect between real world revenue figures and stock price.

          • I agree. I also think the clientele of a Walmart versus a whole foods is totally different when I go into a Walmart around me they are buying cheesedoodles and candy bars and household consumer staples.

            Good investing
            Wayne

  7. Like both TEVA and GILD at these levels. Have a sizable position in TEVA and it has been hammered past year. I have been continuing to add to both. Also long with huge gains on JNJ, BDX, ABT, and ABBV. Good stuff DIv Hut!

    • Hi AA,

      Wow, I see we are both fans of the sector. Happy to be a fellow shareholder with you in so many great names. I’ve had AMGN, GILD and PFE on my watch list seemingly forever and felt it was time to start small in each and nibble a bit at current levels. As always, I appreciate your comment.

  8. Divhunt my man, way to go! 🙂 Impresive purchase amounts. Im also interested in GIG, ABBV PFE and ABT. For now I own only JNJ. To less capital alocation 🙁 But house few hundered $ each month is better then nothing 🙂

    • Hi P2035,

      Invest whatever you can when you can. It’s all about building up that dividend income stream share by share. As you can see these buys were all on the small side as I used up free trades credited to my account. I figured this was a good way to nibble on positions and slowly build up my pharma holdings. Thank you for commenting.

      • Ou by the way personaly I would avoid MCD. They have negative equity. Also their sales is declining as MCD became a etalon for unhealthy food which deline is exeleratin in the west. Lookibg at future I dont see such companies as KO, PEP, MCD, XOM, CVX in form they are today. Yes they can change and adapt, but that a bet and I dont like betting especialy on comapnies with low equity and bussiness based on borrowed money. Thiz flys now but when problems come and credit market closes… Im not sure if such companies as MCD woudl survive 2007 scenario today.

        • Hi P2035,

          You bring up an interesting point about all the companies you mention and many have cited the same claims that the past performance of these “old” companies will never be the same in the future. I guess time will tell. Thanks for the reply.

  9. Some nice purchases here DH. The only one that I would say is on my watch list would be Pfizer. I started a position earlier this year so I would need to see them drop below my cost basis of around $32 before I would consider adding more.

    One that you added recently that I am still watching is General Mills. I also started a position here earlier this year but it continued to drop some more so I am considering adding more to that position.

    Overall, I think you made some good purchases and look forward to seeing what you buy next. Thanks for sharing.
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    • Hi MD,

      I have been watching my portfolio during the first three weeks of June and wondering where to put my fresh capital. After loading up on GIS, GWW, VFC and others for the last several months I decided to expand my portfolio and add these four new names. I’m still watching GIS though. If it continues to slide I may nibble on that stock once again. Thank you for stopping by and commenting.

    • Hi IH,

      The sector has been super hot in recent days. Seems like JNJ, ABT, ABBV and others are making new highs with some biotechs jumping from their recent lows too. At these levels I’m happy to start nibbling and see where things go from here. Thank you for commenting.

  10. Not questioning any of those picks, but the timing is a little curious. You could have gotten each of those (aside from TEVA, don’t know much about that one) at considerably better prices not too long ago. For example, you’ve had AMGN on your buy list for two years but just now pulled the trigger at the higher end? I’m wondering, did the political news regarding the proposed health bill in the Senate impact your decision in any way?
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    • Hi anonymous,

      No doubt I was watching those stocks for a few days too long. That week I was considering each of those names and simply saw them all climb and climb and climb till I finally pulled the trigger. Sure, I did not get in at the absolute bottom but who really does and I plan to make each of these holdings “forever” in my portfolio. As you can see from my buys they are all on the small side which will leave me room to average down should prices falter. Sometimes, it’s best not to over think a stock buy. Yes, I have had AMGN and GILD on my watch list for a long, long time and with other buying opportunities light I decided it was time to nibble on this sector a bit more. The plan going forward to to slowly increase my overall health sector holdings. To answer your question outright, the news, headlines and politics did nothing to sway these buys for me. Thank you for your question.

    • Hi DG,

      It was time for me to nibble on some solid dividend payers in the pharma/biotech space that also have plenty of room for future growth. As always, the plan is to keep my consumer staples the largest overall sector but I do want to boost my exposure to the health sector as well. Thank you for stopping by and commenting.

    • Hi Gd,

      Thanks for that vote of confidence with my recent tranche of buys. Nibbling a bit here and there in the pharma/biotech space is something I wanted to do for a long time. I have been adding to my consumer staples (GIS, HRL and others) a lot in recent months and wanted a switch. Thank you for sharing your thoughts.

    • Hi DD,

      These recent buys highlight my frustration with finding good places to invest in my current portfolio. Instead of adding to my HRL, GIS or VFC again, as I have been doing for several months, I decided to “spread my bets” with several small purchases in the pharma/biotech space. This will allow me to average down nicely should any of these new positions experience a price swoon going forward. Bottom line… keep buying! As always, I appreciate your comment.

    • Hi DDU,

      I felt compelled to start nibbling on more health sector stocks with specific biotech/pharma plays as they were lacking in my portfolio. I’ll be watching those stocks going forward and will gladly average down should an opportunity arise. As always, I appreciate your comment.

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