Friday, May 4, 2012

New Purchase - COP

I couldn't resist ConocoPhillip's (COP) new yield, today I bought 24 additional shares.  The shares were picked up at $53.07 which is a yield of 4.94% after transaction costs and will pay me $63.36 per year.  This is a slightly better price than my initial (prorated for the spinoff) purchase.  I always like to average down when I can.  Oil stocks were hammered this week due to lower gasoline prices and sluggish job growth.  I would welcome further market declines since I plan to make at least one more purchase in May.

Since the spinoff I have noticed investors sold PSX and seem to have a more favorable opinion of the new COP.  PSX took a harsh beating in market price this week, I will hold it regardless.  As I stated in a post about the spinoff, I plan to keep both companies.  Right now I'll only consider adding shares of COP until I know more about Phillips 66.

Have a great weekend!

8 comments:

  1. Nice purhcase. It has a great yield currently! I just hope they can keep raising it longterm and at a decent growth rate. I'm looking at possibly adding another oil play soon, possibly CVX.

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    1. With the new and improved yield, I have lower expectations of dividend growth. 4-5% per year would be fantastic. I like CVX more than COP, but obviously the yield is lower.

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  2. CI,

    Nice buy here. I was very close to buying some COP myself today. I was watching the market today as I have the day off, and after watching crude get hit hard COP and CVX both looked attractive to me. The only thing that kept me from buying more oil is that Big Oil is already 12% of my portfolio, but that COP yield is juicy. COP is right up there in yield with some of the European majors like TOT and RDS.

    I've got some capital available and currently watching COP, CVX, SYY, EMR, MDT, INTC. SBSI has fallen quite a bit after I purchased them, I may add. So many stocks...so little capital!

    Best wishes.

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    1. "So many stocks...so little capital!" I feel that way all the time. It's going to be difficult to stop buying new companies when I get to 30. I've been thinking about oil stocks lately and BP crossed my mind. I might start a small position in BP knowing that it is risky.

      12% of your portfolio in energy is basically the same as the S&P. I don't see a problem adding while the sector is cheap. Maybe if you wait you'll get a better price, who knows.

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    2. SBSI fell mostly because of the stock split by the way. We will get our extra shares next week if I remember correctly. They reported earnings a few days ago and did a lot better than last year. Now might be a good time to add, I still plan on keeping my position small however.

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  3. I agree, that's a nice purchase. Oil prices and oil stocks definitely took some hits today. I am watching COP and CVX in this area.

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  4. I suspect PSX will return a good amount of cash to shareholders based on comments from the new CEO. I expect it to increase the dividend on an annual basis. Don't own any, but it's on the radar.

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