With a new year and a new month upon us, it is time, once again, for me to outline my potential stock picks for my dividend growth portfolio. I’ll continue to preface this post with my usual rant about how important it is to ignore all the financial panic that’s being spewed by the mainstream media. As we all know by now there is never a perfect time to invest. There will always be some political, financial, economic or social worry that indicates an imminent correction or collapse. It can be North Korea, oil prices (too low or too high, take your pick : ) ), inflation, deflation, Ukraine, Russia, market valuations, remember Ebola, global warming, freezing winter weather, South China sea, how about Somali pirates (been kind of quiet lately), Iran, Syria, ISIS, Brexit, Greece, U.S. debt, government shutdown and anything else you would like to add to this never ending and ever evolving list. Bottom line, don’t be afraid to invest in a consistent and systematic manner. Over the long haul, being invested and staying invested in the stock market gives you the best long term odds of success.
With a highly volatile ending to 2018 we have no shortage of quality dividend stocks to choose from. With that being said, let’s take a look at my January 2019 potential stock pick(s).
First up, I’m thinking about buying more AT&T Inc. (T), especially if stock prices remain at $30 or below. T was my sole purchase in November as prices remain depressed and yields get pushed ever higher. Sure, there are a lot of near term headwinds this company is currently facing, not least of which is its debt load, but, the dividend still appears to be quite safe and can reward patient shareholders over the long haul. T still remains less than 1% of my taxable account and much less when compared to all three of my portfolios. In other words, I’m still comfortable adding to my position.
Next, is a polarizing name that you either love or hate but looking strictly at the numbers has become too hard to ignore. I’m talking about Altria Group, Inc. (MO). MO has had a tough 2018, but in recent weeks the stock has really been beaten down hard pushing yields to over the 6% mark. With a moderate payout ratio around 51%, MO has the cash to keep paying this juicy yield. As with T, MO is also less than 1% of my overall portfolio which allows me to add to my position. Another tobacco stock I am also considering is Philip Morris International Inc. (PM). Like MO, 2018 has not been kind to this stock but with impressive yields going into 2019 it’s another name that’s getting hard to ignore.
Next, I am considering a health sector stock that has also been hammered in 2018, Cardinal Health, Inc. (CAH). This dividend stalwart continues to pay out a safe dividend with a yield that is also relatively high for this stock. At current prices the stock still seems fairly valued even after climbing from its 52 week low.
Finally, I’m looking at Gilead Sciences, Inc. (GILD) still. It was one of my potential picks for December and prices continued to get hammered throughout the month driving up yields to historical highs well over 3.5%.
What do you think about my potential stock buys for the month of January? Are you considering any of these names for your own portfolio in 2019? Please let me know below.
Disclosure: Long T, MO, PM, CAH, GILD