There’s A New DivHut In Town

I know I have missed a few days since my last post but it has been for good reason. I am happy to announce that after almost six years of marriage a new baby DivHut entered the world on March 6. Happy to announce that both mother, father and baby boy are all doing well and adjusting to the first days of parenthood. We are very fortunate to have family nearby to assist us in these first few weeks and beyond.

 

As you can imagine both mother and father are very excited after trying all these years to have a child and are now finally blessed. These are the events that truly help put all our ‘first world’ problems into perspective and helps you realize what is truly important in this world and what is simply noise.

 

I debated sharing this news on my blog for several months as having a child is a very close and personal affair. But after much internal debate I obviously opted to share this news. With all the transparency among the dividend bloggers sharing debt, income, expenses and net worth I felt comfortable sharing this joyous news with you. Of course, being a dividend blog I just wanted to share a few dividend names that have interacted with us while staying in the hospital.

 

First up is a name that has circulated among the dividend bloggers quite a bit several months ago, Covidien plc (COV). Though COV was recently bought out by Medtronic (MDT) for $42.9 billion, their namesake products were all over the labor/deliver and recovery room. MDT has a current yield of 1.59% with a low payout ratio of 27.9% based on an EPS of 3.12. This name is a dividend workhorse raising payments for over 37 years and has a ten year annualized dividend growth rate of 17.27%. From a dividend perspective this stock seems to be firing on all cylinders. Though only yielding a current 1.59% this stock has an impressive ten year yield on cost of 6.65%. From a valuation standpoint, MDT has a PE of 22.3 which is high relative to its five year average. Forward PE looks more enticing at 18.1. Not too shabby if you ask me.

 

A non-health sector name that was prevalent in both our rooms was 3M Company (MMM). From bandages to tapes and other wraps, 3M products were readily being used. Currently yielding 2.46% with a moderate payout ratio of 50.1% based on an EPS of 7.47, MMM also has a very long history of raising dividends that extends more than half a century. The ten year annualized dividend growth rate of MMM is a healthy 9.04%. Need more reason to look into this conglomerate stalwart then consider the ten year yield on cost of 4.17%. The current PE of MMM is 22.3 which is well above its five year average suggesting a relatively expensive stock at current prices. As with MDT, forward PE looks a lot more enticing at 18.1 but still high relative to its five year average PE of 16.8.

 

Finally, we were surrounded by many consumer products from Abbott Laboratories (ABT). ABT yields 2.05% with a moderate payout ratio of 44.7% based on an EPS of 1.13. This stock was made very famous several years ago when Grace Groner passed away in 2010 and it was revealed that her estate totaled in excess of seven million dollars largely from her 1935 purchase of three shares of ABT. Decades upon decades of stock splits, dividend raises and reinvestment has turned a one time modest investment into multi-millions. Just another real world example of the power of dividends. ABT has raised its dividend for well over forty years and with a manageable payout ratio and cash flow it appears that dividend raises are likely to continue. From a valuation perspective ABT has a current PE of 41.4 which is well above its five year average PE of 18.0. This stock price looks like it has jumped well ahead of earnings in recent times. Might be prudent to wait before pulling the trigger on this one.

 

This just goes to show that great dividend paying companies surround our everyday lives no matter where we are. From consumer names that we use each day to industrial products and health items. From my perspective there’s no reason to ever invest in any type of stock other than solid dividend payers. The ubiquitous nature of these companies can help ensure their longevity.

 

Again, I’m excited to share the news of baby DivHut with you. I appreciate all the support, words of encouragement and comments received from this community. Are any of the names above in your dividend portfolio? Please let me know below.

 

Disclosure: Long MMM, ABT

130 thoughts on “There’s A New DivHut In Town

    • Hi dividenddreamer,

      Thank you for the well wishes. There’s no question a new dividend investor has entered the world. Without doubt in his first year of life a dividend growth account will be created. Appreciate the comment.

    • Hi Liquid,

      Appreciate the well wishes. I’m a little curious too in seeing how a new addition impacts a household budget. We’ll see in the coming months how things play out in that respect. As for my dividend investing, I still plan to make purchases every month as if nothing changed. That is my indefinite goal. Thanks for the comment.

    • Hi DH,

      A true blessing indeed that’s been almost six years in the making. We just kept trying… till success. Kind of a life lesson. I’ll keep the hustle going on for my sake, my child and family of course. It’s been a great first few days and you can imagine myself and whole family beaming. Thank you for commenting.

    • Hi Allan,

      Thank you for the well wishes and keep on trying. Our baby DivHut is almost six years in the making so just don’t quit. Make sure your wife is high on folic acid. That seems to be the magic supplement. Thanks for stopping by.

    • Hi DG,

      Thank you for your kind words. Mrs. DivHut is super on board the dividend growth model for our little one. Our goal is to have an account set up sometime within his first year. As you can imagine we are pretty busy these days and running on little sleep. It’s all good and I feel energized more than anything. Nature kind of takes over I guess. As you can imagine family and friends are coming and going every day and once things calm down we’ll set up an account and fill it exclusively with solid dividend growth stocks. Appreciate your comment.

    • Hi R2R,

      I appreciate the sincere wishes. The support from our online DGI community is awesome and I’m glad I decided to share this news. I feel even more energized and dedicated to our common goal. You know the way I think. I see dividend companies everywhere I look and sitting in the delivery room for several hours I began to look at all the medical items around us and of course saw many familiar names. Thanks for stopping by and commenting.

    • Hi UTMT,

      You know it. Our goal is to have an account set up within his first year. Mrs. DivHut and I are very excited to see how two decades of compounding will work out in his favor. I appreciate your comment and support.

    • Hi weenie,

      Thank you for your well wishes. Yes, it’s true our little one will have an investment account well before he walks. Our goal is to have something set up within his first year and make monthly contributions and buy only solid dividend paying stocks. Thank you for your continued support.

    • Hi FV,

      Thank you for your best wishes. I am truly overwhelmed by the outpouring of supportive comments from yourself and others in the dividend investing community. As always, I appreciate the comment.

  1. Divhut,

    Congratulation to you and especially to your wife for this benediction! Wishing the new baby all the best and he started well in life with parents looking at FI early.

    So what are the saving plan for baby Divhut, do you plan to save X$ per month, investing some shares in high dividend company?

    Would be nice to know how parents that are targeting FI manage the financial of their creation.

    Cheers, RA50
    Retiredat50 recently posted…Roche (ROG.VX) pay checkMy Profile

    • Hi Ra50,

      I appreciate your well wishes. I feel very fortunate to have Mrs. DivHut 100% on board with a long term dividend investing strategy for our little one. For now we have a goal of just setting up an account for him within his first year. As you can imagine we are quite busy these days with family, friends and a lack of sleep. Once things subside we’ll look into an X$ per month DRIP plan in several companies or perhaps a Sharebuilder account. I emailed Loyal3 to ask if they offer custodial accounts but they replied that they do not. Only 18 and above can invest in Loyal3. Bummer. In any case the plan is to not chase yield rather buy solid long term dividend growers and allow for about two decades of compounding. I’d be very curious to know the income a portfolio like that would be producing by the time our little one is in college. Hopefully by then he’ll know the power of dividend income and continue to add to his portfolio. Thank you for stopping by and commenting.

    • Hi FtFF,

      Thank you for your kind words. As with anything in life challenges abound but from what I read and hear the rewards of parenting outweigh the challenges by far. I’m excited to have this new life experience. It’s just another piece in the puzzle of my life. Thank you for sharing your thoughts.

    • Hi Tawcan,

      Always appreciate your comments and support. Life is ever changing and this is simply another change/experience that I welcome. Thank you for stopping by.

  2. DivHut,

    Big congrats! Wonderful news. Glad everyone is okay and healthy. πŸ™‚

    It’ll be fun and interesting to see how this shapes your household budget/investing activity. Some think a child or two can ruin a budget, but a lot of smart savers/investors out there have shown that it’s just not true.

    It’d be a great time to buy a few shares of some high-quality companies for DivHut Jr. and let those things ride for the next 18 or so years.

    Congrats once again.

    Best regards.
    Dividend Mantra recently posted…Recent BuyMy Profile

    • Hi DM,

      Always happy to share great news. I am glad I made the decision to share this personal family news with our online investing community. The outpouring of well wishes and happy sentiments really warms me. I fully agree with you that a child or two does not equate to financial/budgetary ruin. There are loads of single people out there with little to no net worth and drowning in debt. It’s all about lifestyle and making wise financial choices throughout a lifetime. DivHut Jr. will be invested in some dividend stocks before his first birthday. That’s one of our near term goals. I’m just as curious as you to see how two decades compounding of MMM, JNJ, ITW, GIS, for example, will look like and what kind of income it will be producing. As always, I thank you for your comment.

    • Hi DH,

      Thank you for your well wishes. I thank the heavens that both mom and son are both healthy and recovering after labor. These are truly the important aspects of life and not the material nonsense that so many seek gratification from. I appreciate the comment

    • Hi DH,

      Believe me, Mrs. DivHut and I are truly appreciative of all the hand me downs we have received from friends and family members. DivHut Jr. has drawers full of clothes that are less than a year old and came to us at a cost of $0. We have two bassinets and a baby rocker also for $0. Mrs. DivHut and I know that almost all clothes, toys, etc. are quickly outgrown and we plan to pay it forward once we’re done with our hand me downs. The only thing we bought brand new was a car seat/stroller combo and diapers of course. Changing table, bags and bags of clothes, bassinets, rocker and more all came via hand me downs. After all, DivHut Jr. doesn’t have to impress anyone. Thank you for stopping by and commenting.

    • Hi DGJ,

      This is a life change that we have been seeking and are finally happy to have it arrive. I’ll take things one day at a time and continue to invest for my future along with Mrs. DivHut as well as the future of our new son. Thank you for your well wishes.

    • Hi JC,

      Thank you for your kind words and support. I always say that great dividend paying companies surround us every day. All you need to do is look around and see what popular products and services are being utilized on a daily basis. While waiting in the delivery room I had a few hours to just look at all those COV, MMM, ABT and other names that were prevalent. To me, dividend growth investing is a no brainer and I wonder why more people don’t jump on board. I appreciate your comment.

  3. Keith,
    Congratulations to you and your wife. May your new addition pay a multitude of dividends over the years.
    KeithX

    • Hi KeithX,

      Well said. I appreciate your kind words and well wishes. Having a child definitely enhances your sense of family and what is truly important in life and what is nonsense. Thank you for your comment.

  4. Congrats on your “mini-me”! Glad you and the Mrs were successful in your parental pursuits. I wish you all great health and a bright future.

    As for the companies that surrounded you, I notice the same when I’m out and about. It makes me smile when I see so many companies I’m invested in, everywhere I go.

    – HMB
    HMB recently posted…Take to the SkiesMy Profile

    • Hi HMB,

      Our parental pursuits took almost six years but in the end we have been blessed. Thank you for your kind words. I’m like you when I go out and about and see people drinking a KO product or at a Taco Bell (YUM) or McDonald’s (MCD). Dividend investing does not have to be hard. All you have to do is just look around. I appreciate your comment.

    • Hi TBTI,

      That’s too funny. After all 3M has a nice ring to it doesn’t it. Emerson or Kimberly are nice names too. Of course, Philip and Morris are practical as well. Thank you for your kind words and for commenting.

    • Hi ACI,

      Thank you very much for your kind words and best wishes. Somehow Mrs. DivHut and I are getting by just fine with much less sleep. It’s all good. I think nature takes over and our bodies rise up to this new challenge. We feel blessed that everyone is healthy and doing fine. Truly something to be thankful for. Thank you for commenting.

    • Hi DL,

      Too funny. I guess DivHut Jr. is an IPO of sorts. Thank you for your well wishes and kind words. It’s much appreciated. The Mrs. and I look forward to many years of future joy from our little one.

      • Hi WL,

        I couldn’t agree more. I also got a kick out of that. Thank you for the well wishes and I can attest to the lack of sleep. Every two or three hours it’s feeding time. But as you said they’re worth it. So far so good. Thanks again for stopping by and commenting.

  5. Congrats! Baby divhut probably growing very fianancial savvy as divhut daddy still cranking out dividend paying stock in the recovery room. It cracks me up, but you are absolutely right about dividend paying stock with great potential dividend growth.
    Vivianne recently posted…Recent BuysMy Profile

    • Hi Vivianne,

      We appreciate your kind words and support. Thank you. DivHut Jr. will definitely have an early lesson in compounding and the magic of dividend investing. I’ll try to explain to him that money is coming in to him no matter what he does and hope that by the time he is an adult he’ll be the owner of a nice passive income producing dividend portfolio. I always say that dividend investing doesn’t need to be difficult. Even if you have no knowledge all you have to do is open your refrigerator or cabinets and see what products are inside and consider buying those companies first. Thank you for commenting.

    • Hi Ryan,

      Thank you for the best wishes. Mrs. DivHut and I appreciate all the good vibes being put out there. Appreciate the support!

  6. Congratulations on baby DivHut! Glad that everyone is happy and healthy. πŸ™‚

    I do exactly the same thing whenever I’m in just about any sort of situation – I’ll look around and see what names I recognize and what companies are present in whatever that situation is in. Does this mean you’re going to have a post on the products and companies that baby DivHut will be using? πŸ™‚
    Seraph recently posted…Dividend Income and Goals Update, February 2015My Profile

    • Hi Seraph,

      Thank you for your kind words. We feel very fortunate that mom and baby are doing well and have been recovering nicely after the birth. Like you, I too look around and see what products or services are surrounding me, whether in an office, hospital or just sitting at home. I’m sure a post about baby DivHut dividend stocks is coming in the future after several months go by and I’ll be tallying up the number of JNJ, ABT and other dividend stocks that baby DivHut is consuming. Thank you for stopping by and commenting.

  7. CONGRATULATIONS! Your life will be changed forever. Enjoy every moment because the saying is true, they grow up very fast. Your child is lucky that you’re setting up your family for a secure financial life. Also, I’m not sure what baby food you’ll use when the time comes but a big brand is Gerber which is owned by food giant Nestle (NSRGY).

    • Hi DD,

      I appreciate your kind words and sentiment. I know my life is forever changed but that’s just a natural part of life. This is just another life experience I can add to the many I have already had in the past. As far as baby food we are on breast milk and formula from Similac (ABT). Maybe a Gerber product is in our future too. One day at a time. As always, I appreciate your comment.

  8. Wow! Congrats on you two and welcome baby boy! πŸ˜‰ These are the times in which we realize why we’re doing it all! Found it funny to see I’m not the only one taking advantage of my children events or stuff to discover new stocks! hehe! You’ll see you’ll soon get addicted to it! πŸ˜‰ Enjoy these precious times and take care!

    Cheers!

    Mike
    DivGuy recently posted…Day#3 What is the Best Dividend Growth Stock?My Profile

    • Hi DG,

      Thank you for your wishes and support. As you can imagine we are very excited to have started our own little family and all that it entails. As you stated, “These are the times in which we realize why we’re doing it all!” So true. We plan to start a dividend portfolio for our little one before his first birthday. I know in time things will calm down and be less hectic around our home between the visitors and phone calls and Mrs. DivHut and I plan to sit down and start on a long term investing plan for our first born. Thank you for stopping by and commenting. Much appreciated.

    • Hi Dipu,

      Thank you for the kind words and well wishes. I appreciate all the support received from our little online dividend investing community.

    • Hi ANHA,

      Thank you. We’ll see what baby DivHut buys first in the coming months. Our goal is to have an account set up for him before his first birthday. Right now things are pretty hectic with family and friends dropping by and for us getting used to being new parents. When things settle around our home we’ll be looking into starting a nice dividend growth portfolio with many of the familiar names we all invest in ourselves. Thank you for commenting.

    • Hi SWAN,

      Thank you for your kind words and best wishes. We really appreciate all the outpouring received from our little dividend blogging community. Thank you for stopping by.

    • Hi Adam,

      Big, happy news. We feel so blessed to have finally been able to start our family after so many years. Thank you for your comment.

    • Hi Pullingmyselfup,

      I’m continually amazed at the transparency of the personal finance/investment bloggers out there. I think it’s great that everyone shares some pretty personal information about themselves which is why I ultimately felt comfortable sharing this news with my readers. Thank you for your well wishes. I appreciate the comment.

    • Hi MDP,

      Thank you for your kind words and best wishes. So far so good. Being a parent seems to be suiting myself and Mrs. DivHut just fine. As you can imagine we are both very happy. Those PG (Pampers) and KMB (Huggies) are coming in handy and being used quite often. Thanks for commenting.

    • Hi OBFW,

      Thank you very much for the kind words and well wishes. Mrs. DivHut and I appreciate all the support and good vibes being sent via the blogosphere.

    • Hi NMW,

      You know it. The plan is to get him invested in dividend paying stocks before his first birthday and teach him all the basics of dividends, investing and income at a very early age. Thank you for your well wishes and kind words.

    • Hi DD,

      Thank you for the best wishes. Mrs. DivHut and I are looking forward to this new life experience that lay ahead of us. So far so good. The transition has been minimal. We are just so happy that after all these years we have our little blessing.

  9. Congrats to mom, dad, and baby! What a truly beautiful blessing. Glad to hear everyone is doing well.

    Enjoy every minute of it…it is so true what they say – “it goes by FAST!” Cherish and record every moment and every experience. They are only 1 month old once, 1 year old once, 10 year old once. πŸ™‚

    Best wishes. AFFJ
    A Frugal Family’s Journey recently posted…RECENT BUYS (NYSE: RDS, NOV and ESV)My Profile

    • Hi AFFJ,

      Advice well heeded. I have heard this from many other parents that every moment comes and goes in the blink of an eye. We have those thoughts in the back of our head every time we are awaken with a cry knowing that this time will pass and one day be a distant and fond memory. I appreciate your best wishes and support. Thank you for stopping by.

  10. Divhut, congratulations. I can tell you that having kids makes it all worthwhile. The first few years will be very interesting indeed. πŸ™‚
    On your list, I have my eye in MMM, but I think it is still a little expensive for me.

    Div4son
    Div4son recently posted…Purchases since August 2014My Profile

    • Hi D4s,

      I appreciate your well wishes and good sentiment. So far, parenting feels very rewarding and we are very happy to have finally become a family.

      MMM is a great company that I’d like to add to as well but not at current valuations. Sometimes the great names always have a premium attached it seems. Thank you for stopping by.

    • Hi TMS,

      I appreciate your well wishes. There’s no question that a new dividend investor is among us. I plan to teach him early on the benefits of compounding as well as passive income generation. Thank you for stopping by.

  11. Congratulations on your new baby. From reading your blog it sounds like you have a great head on your shoulders and that you’ll give your little one a good life, including sound financial advice. πŸ™‚

    • Hi Lila,

      Thank you for the well wishes. Without question Mrs. DivHut and I plan to pass on some sane financial advice to our little one from an early age and start a dividend growth portfolio for him before his first birthday. As you can imagine things are pretty crazy around our home with family and friends stopping by and us getting settled into parenthood. In time, things will quiet down a bit and our financial knowledge will begin to be passed on. I appreciate you stopping by and commenting.

    • Hi BSR,

      Mrs. DivHut and I are enjoying the crying, burping, 4am feedings as well as the sweet sleep, growth and general ‘cuddleyness’ of our little one. So far so good I feel blessed that the transition into first time parenthood has been smooth. Thank you for your kind words and well wishes. Baby DivHut has a long future of dividend growth ahead of him. I appreciate you stopping by.

    • Hi DD,

      Thank you for your well wishes. Happy that mom is continuing her recovery from labor and that baby DivHut is growing nicely the last week and a half. As always I appreciate your comment.

    • Hi DD,

      It’s been a great time so far. Becoming a parent is one of those life experiences that cannot be replicated unless you actually go through with it. Mrs. DivHut and I feel very fortunate that after all these years we were able to create our own family unit. Thank you for the well wishes. I’ll be back writing articles sooner than later. I appreciate the comment.

  12. Congrats on the birth of your son. Having a little one helps put everything in perspective. All the best to you, your wife and your new addition.

    • Hi James,

      Thank you for your kind words. I fully agree that creating a family definitely highlights what’s important in life and what is simply noise. Thank you again for your best wishes.

    • Hi DFG,

      With a name like ‘Dividend Family Guy’ I can assume you love having kids and your own family. To be honest, I feel very much the same helping create my own family unit with Mrs. DivHut. Thank you for the well wishes and I appreciate you stopping by.

    • Hi PIM,

      Thank you. Baby DivHut will be starting his passive income career very early in life. Mom and baby are both doing well and being a parent for two weeks has been nothing short of spectacular. Thank you for commenting.

    • Hi HHaWG,

      Thank you very much for sharing those sweet thoughts. Both mom and baby are continuing to do well and life as a new parent has been nothing short of awesome. I appreciate your comment.

  13. DH and growing family,

    Congrats on the new son! We are fortunate to have two boys ourselves. We definitely made similar observations of potential investments when we had our boys as well but we weren’t in a place to invest. I also remember Mead Johnson, Stericycle, Johnson & Johnson and Kimberly Clark as well. Anyways, all the best and be sure you enjoy every minute because they grow up fast.

    FD

    • Hi FD,

      Thank you for taking the time to stop by and comment. I appreciate your kind words and advice about enjoying every minute of parenthood. It seems that every parent, without exception, mentions how fast their own kids grow up. Two weeks into being a new parent I can hardly believe where the time went either. Mrs. DivHut and I are already looking into establishing an account for baby DivHut soon and filling it up with some solid dividend payers. JNJ seems like a good place to start. I’ll make mention of when we actually start his investment account. Thanks again for commenting.

    • Hi MD,

      Always nice to get a message from a reader outside the U.S. Thank you for your kind words and for stopping by.

    • Hi GRB,

      Thank you very much for your kind words. I fully agree with you that there is no feeling like it. Becoming a first time parent is a unique life experience that can only be had if you actually become a parent. Holding my little one and just looking at him I feel a closeness and bond that I did not think I’d feel so soon. I’ll be back to blogging more regularly in April. The last three weeks has certainly been an adjustment. Thank you for commenting.

  14. First off congrats on the new addition to the family. Second I did the same thing when I had my twins a few years back, some of the companies in my local hospital where Stryker, GE, Panasonic, and the famous Johnson & Johnson. I should have invested in JNJ back then, but I didn’t. On the next dip in stocks, I will consider buying them. Good luck.
    EL @ Moneywatch101 recently posted…The Real way to get out of DebtMy Profile

    • Hi EL,

      Thank you very much for your kind words and well wishes. We’re very happy to have our new addition and the adjustment to parenthood has been quite smooth thus far.

      It seems that every income investor sees the world through “dividend eyes.” Just like you noticed many great names in the hospital while you had your twins I too noticed what was all around us in the hospital. We plan to open a baby DivHut income account in the coming month or so and plan to fill it with many great dividend income companies such as JNJ, ABT, GE, ITW, GIS and the like. Thank you for stopping by and commenting.

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