Can you believe it? October is knocking on our door and it’s time, once again, to outline my potential stock picks for the new month. Looking forward I feel compelled to mention some of my recent ‘old favorites’ as well as mention some REIT picks which I haven’t bought in a while. I’ll get to those in a minute.
It’s no surprise that I’m singing the same tune again as we approach a new month. The market is continuing to grind ever higher and shake off every possible political, financial, social, global and weather related wrench thrown at it. Seems like ‘old hat’ rehashing this same sentiment but it just goes to show that no one can predict where the market is headed in the near term (days, weeks and months) and as long term dividend growth investors it’s best to simply stay in the market, keep adding additional funds regularly and collect those ever higher dividend payouts. I understand that it’s compelling to sit on the sidelines as indexes reach higher and higher milestones and build up a cash position but what does that accomplish when our primary goal is to build up our passive income stream? No one knows what tomorrow will bring and it’s folly to think that anyone will be able to pinpoint the “best” time to invest. After all, when would one feel compelled to jump in the market again? After a 10% decline, 20%, 30%? Instead of guessing, look for solid, well valued companies paying out sustainable dividends and enjoy the ride. With that being said, let’s review some stocks I’m considering for the month of October.
First up is a name I bought last month and am considering once again, Johnson Controls International plc (JCI). JCI is a solid long term dividend paying industrial that has been lagging a bit post it’s Adient plc (ADNT) spin off and continues to look very good to me at current levels even though the stock is up about 10% from its recent low reached in late August.
I am also continuing to look at Hormel Foods Corporation (HRL) and General Mills, Inc. (GIS) each trading slightly above their 52 week lows and still sport safe relatively high yields. Seeing HRL yielding over 2% is a historically high yield for that stock.
And now for some picks in the real estate sector. It’s been a while since I added to any of my health REITs in my IRA and September has not been kind to the sector. It seems that economic projections are looking up and with the markets moving in lock step with higher GDP estimates and a tax reform bill on the table, the Fed fears of potential interest rate raises are back in play. Whenever the markets get a hint of a potential interest rate raise the REITs get smacked. Of course, with the health REITs other factors are in play too such as oversupply in the market. With that being said, I am considering adding to my HCP, Inc. (HCP) and LTC Properties, Inc. (LTC) holdings as both have seen significant declines in September and are looking a lot more attractive these days.
What do you think about my potential stock buys for the month of October? Are you considering any of these names for your own portfolio next month? Please let me know below.
Disclosure: Long JCI, ADNT, HRL, GIS, HCP, LTC