6 shares BP, 4.91% yield, $13.68 annual income
The big news today is that my forward annual income surpassed $6,000 meaning I will be averaging $500 per month dividend income from this point forward. I don't dwell on milestones. You won't see me getting excited about my portfolio reaching some arbitrary value. But this one is significant for me. You see, I have saved at least $500 every single month for the past 6 years. Now my dividend income will start to match my own efforts ($500 per month) as I attempt to attain this thing called financial independence. Very cool!
Today I started a new position with BP plc. With a forward p/e of only 9.4, I feel BP is one of the cheapest dividend growth stocks in an otherwise heated market. 9.4 Anyways BP is an oil major based out of the UK. It's still plagued by pending lawsuits from the Deepwater Horizon spill in the Gulf of Mexico. The company seems to be situated well enough financially to weather additional costs however. This past month BP stock declined quite a bit as investors seemed to be spooked by tensions in the Ukraine. BP owns about 20% of the massive Russian oil company Rosneft. That's why.
I don't know Russian policy or what Russia will do in the future. However I can at least take advantage of the tension buying affected companies on dips that I want to own anyway. At the beginning of March BP traded around 50, now it's around 46. If it slides even further I would be happy to add more shares on weakness. Barring WWIII scenarios I feel this is the correct way to approach the tension.
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.
Symbol: BP
Core Position: No
Speculative Position: No
Expectations: Steady income; 5% annual dividend growth
Automatic Sell: Frozen dividend; dividend cut
Consider Selling: Business fundamentally changes, management becomes untrustworthy, fundamentals deteriorate, wildly over valued stock price, or position fails to meet expectations
Nice buy CI. I did a write up on BP for seeking alpha, and thought the dividend looks appealing at nearly 5%
ReplyDelete-Bryan
I agree with you. There are some pretty serious risks involved, but it is cheap and gushes out income with the best of them. I hope to acquire additional shares over the next few months.
DeleteNice new addition to your portfolio that pays a good dividend. I think you got in at the right time.
ReplyDeleteThanks Gareth. Catch you later man.
DeleteNice buy. I agree that BP is good value in the current market. BP and BAX have been on my radar for a week. I'd like to round out my position in each. $6k a year in dividends in nothing to sneeze at. Keep it up.
ReplyDeleteI had been considering BAX and it would have bought it if I had room for a second purchase this week. I see it spiked upward the past couple days, seems I may have missed an opportunity to add. Congrats on the $6,000 mark yourself!
DeleteCI,
ReplyDeleteCongrats on the milestone. That snowball is really starting to gain momentum. BP is a nice buy with a fantastic yield.
Thanks for stopping by and thanks for your support! I will be following your progress, keep it up!
DeleteCongrats on the $6k! Of course milestones are just that, and aren't the culmination of your journey, but are enough to be celebrated.
ReplyDeleteI like BP, and kick myself for selling last year after not being a fan of the ADR nature of BP (affected the DRIP). Since I am less concerned with dripping dividends, it would have been a sound move to hold on to my position. Either way, I will rejoin you as a shareholder at some point in the future.
Soon enough you'll be able to pool dividends if you want, that might open additional opportunities. One thing I like about BP is that even though it's a European company, ADS shares pay dividends in US dollars. I won't have to worry about exchange rates, which has been plaguing a few of my other positions. Pretty rare!
DeleteCongrats on a huge milestone! That's $500/month you'll no longer have to work for. Next stop, $1000/month!
ReplyDeleteThanks AAI. I can't get too far ahead of myself, next stop $600! Luckily my savings rate will get a boost later this year. I'm due for a raise in a couple months and I've almost reached my targeted savings amount for a future vehicle so I won't have to sock away money each month for that... Every little bit helps right?
DeleteCI,
ReplyDeleteMan, $500/mo in totally passive income is awesome. That's some serious cash you don't need to work for anymore. And it'll only grow over time. That's compounding in action. Very nice!
And nice buy here on BP. I got in not too long ago myself and I'm happy so far. I think there is a lot of dividend growth potential here for the next few years.
Best wishes!
Thanks DM. I will be doing a larger buy next month in addition to these small purchases. I hope GE stays around $25... might be joining you there too.
DeleteCI,
ReplyDeleteI made almost the same exact transaction as you in BP shares and a similar price a couple months ago. Its been up and down, but I'm happily receiving my first dividend from the company this week.
Nice milestone! Showing real progress now and more to come well into the future.
Unfortunately I won't get to collect on this purchase for another quarter. Oh well. Stay tuned, I have plans that include BP being a larger position than 6 shares! Glad to join you as a fellow shareholder. A bunch of us are benefiting off the same companies, how awesome is that?
DeleteI remember the BP oil spill a couple years ago but I wasn't liquid enough and I didn't have the guts to buy. Shoulda coulda woulda! Congrats on the dividend income, that's an awesome accomplishment.
ReplyDeleteI almost, almost got in around $34 a few years ago. Coulda, woulda, shoulda indeed!
DeleteCI,
ReplyDeleteYou should be a lot more proud of that amazing milestone! Do you know how many years most people have to work to get a $500 (semi COLA proof) pension? Decades, if they are even offered that kind of opportunity.
I am back office support in a financial planning firm where I do retirement scenarios. When one adds a monthly income like that it takes so much pressure off the principal it is unbelievable.
Forget BP - Congrats on the milestone!
Thanks for the words of encouragement Evan! I will tell you that I have been executing my plan pretty aggressively, and the most important part for me is maintaining an above average savings rate. It's all about choices, and figuring out whats important in life.
DeleteBest wishes