I scooped up 15 additional shares of Air Products which will pay me $42.60 per year based off the current dividend. APD has recently been a popular purchase among internet bloggers including Dividend Mantra and Passive Income Pursuit. After recalculating APD's fair value, I decided to join the party. My previous buy target of $83 has been increased to $86 which I believe is a nice discount to what this dividend champion is worth. Using DDM, DCF, average p/e, and average yield; I calculated a fair value of $96. I chose a $86 target buy price because I want a decent margin of safety since APD is quite volatile. APD is not a bulletproof consumer staples stock that sells toilet paper and razors. No, it relies on a favorable world economy to fuel growth. I believe that is exactly what will happen long term. We may fall into a recession again, I don't know, but I do think economies will advance over time.
Capitalism is a powerful force. Very powerful indeed. Case in point: S. Korea vs. N. Korea. They used to be one in the same, one embraced capitalism the other didn't. The difference is literally night and day:
Stone age vs. modern technology: the Korean peninsula at night. Progress. I believe it will continue over time and companies like APD are necessary for it to happen. This is where my conviction in companies like Air Products comes from. Have fun with your communism N. Korea. Fools!
I have confidence that the world economy will continue to grow long term, and confidence that APD will be around to supply me with rising dividends. 31 straight years of dividend increases impresses me.
New Purchase - EMB
I also bought 2 additional shares of EMB to strengthen my bond holdings.