|BWP was sold as a limit order, it appears two separate orders were needed to fully execute. Makes no difference since I was charged just one commission.|
I decided it was the right time to part ways with Boardwalk Pipeline Partners (BWP). The distribution was frozen a while back and I think it is likely to stay frozen for quite a while. That was my main motivation for seeking other opportunities. Right now the distribution coverage is thin making it impractical to boost payouts. BWP must pay Loews (the general partner) hefty incentive distributions rights from this point forward again making increases unlikely. Boardwalk has a number of expansion projects in the works, but nothing seems to be a catalyst short term. Also I didn't get the feeling BWP management wants to increase payouts at the moment. They refused to even discuss it on the recent conference call. Time to move on.
Overall I booked a small capital gain with Boardwalk, but did enjoy massive distributions. It's kind of sad to see this one go since it's one of my oldest positions and also a reliable payer. Selling these units meant I had the daunting task of replacing $257.72 worth of annual income. That's a serious chunk of my passive income stream!
With the proceeds from the BWP sale, plus some additional capital, I chose to start a position with Realty Income Corporation and increase my stake in the Southern Company. These two purchases combined keeps my passive stream intact. I'm not too concerned about portfolio worth, but will not tolerate an income decline if I can help it. That was the overarching goal that needed to be addressed here.
Both O & SO are very shareholder friendly and extremely high quality. Investors can expect regular dividend increases with both companies, although typically small. Realty Income calls itself "The Monthly Dividend Company", it's pretty obvious where their loyalty lies. I also love me some monthly dividends which is a rare treat among US dividend stocks. SO can also be counted on in the income department and is one of the highest quality utilities around.
I think both these stocks are trading around fair value at the moment. Neither is especially attractive from the value angle. On the other hand equities are basically at all times highs. I'll accept fair value considering what I have to work with. I believe both Southern and Realty Income will make nice long term holdings. Hopefully I will never have to sell.
I'm likely finished purchasing REITs for the time being, but may reconsider if prices sour. I would be interested in purchasing additional shares of SO however, hopefully I'll get an opportunity to average down.
Chances are I'll do one more purchase this month since I still have plenty of cash collecting dust. Top candidates are currently Coca-Cola and Chevron.