Monday, January 6, 2014
Weekly Purchase - MCD & UL
1 share MCD: 3.36% yield, $3.24 annual income
4 shares UL: 3.66% yield, ~$5.88 annual income
I bought a small amount of McDonald's stock today. MCD is one of my core holdings and is currently trading around fair value. I think it's attractive compared to most other stocks right now. This is one of the highest prices I've ever paid, but will barely affect my cost basis.
I'm pleased to announce Unilever as the newest addition to my income portfolio. Unilever is based in the UK and represents my first dividend growth investment outside North America. I really like this company. It has an awesome collection of brands that consumers will purchase in any economic environment. People need to wash themselves, eat, and do laundry whether we're in the midst of a depression or economies are reaching new heights. You'll recognize many Unilever brands. Some of the more prominent names include Suave shampoo, Dove grooming products, Knorr soups & side dishes, Hellman's mayonnaise, Axe body spray, Vaseline, Bertolli pastas, and Lipton iced teas. The nice part is that UL offers quite a few high quality budget brands and might not be as susceptible to private labeling as say Procter & Gamble.
I calculate UL to be a bit over valued, but it seems to always trade at a premium. Morningstar stamped it with a $45 fair value however. If you believe Morningstar, UL is still pretty cheap. Anyways this is one of those companies that was destined to make its way into my portfolio at some point.
I have many free trades available and did not pay commissions today. I plan to continue small weekly purchases until my supply of free trades run out.