I'm honestly not that excited by this week's purchase. I like General Electric as a company and all, but would much rather accumulate shares are lower prices. I guess this is what happens when the stock market goes up, but the investor is committed to dollar cost averaging. Kind of inevitable in a way, stocks are bound to go up at some point.
At the end of the day my primary objective is being met even if I didn't get a ton of value. This purchase will increase my income, and GE dividends are set to grow over time. Mission accomplished. GE now has a 0.55% weight (by income) for me so plenty of room still remains to acquire more shares. I was also thinking about SO and PG, but felt I should work on portfolio weightings a little bit this week.
This week's purchase was commission free. I plan to resume larger quantity buys later in the year.
Recent Dividend Increases
Southside Bancshares (SBSI) announced a 5.0% dividend increase from $.20 to $.21 per quarter. SBSI now has a 20 year streak and looks poised to become a dividend champion given more time. During 2013 the company did two raises so it's possible 2014 could repeat. I won't be terribly concerned if it doesn't because 1) the company pays a special dividend in December and 2) it just announced a sizable M&A.
Telus (NYSE: TU, TSX: T) announced a 5.6% increase from $.36 to $.38 per quarter in Canadian dollars. Telus proclaimed investors will get two dividend increases this year, so I fully expect another $.02 raise during November. In fact, Telus announced in advance that it intends to raise dividends twice per year for a total around 10% through 2016. TU's new dividend is 11.8% higher than what it paid last year at this point. It's certainly on schedule. Nice dividend contender here (10 year streak) that seems to have slipped past the CCC lists because it started an American ADR not too long ago.
CI,
ReplyDeleteGE seems to be a company that you can buy throughout the year and not feel bad about the purchase. I feel the same way about Clorox and Pfizer , but I am going to hold my nose and buy some shares tomorrow anyway.
You're right about dollar cost averaging. It seems like we always want to wait for the price we paid two years ago, but people were saying the same thing 10, 20, 30 years ago. No doubt someone in 1985 was waiting for PG to get back to the 1982 price level before pulling the trigger. Stay in the game, it's more fun that sitting on the sidelines.
MDP
Exactly.
DeleteYou sir are a smart investor.
I feel the same way you do. I recently added to PG at what I consider to be fairly valued or slightly overvalued. Not the most exciting buy, but it will get the job done!
ReplyDeleteI am pleased with SBSI. Dividend increase and buying another bank in an area with a vibrant economy (Disclaimer: I am from the area.)
Take care!
Perhaps I'll grab some PG next week!
DeleteCI,
ReplyDeleteI hear you. Not much to like in the market, but I try to think about where these companies are going to be 10 or 20 years from now. And I think GE is one of the better opportunities available right now, all things considered. Nice buy!
And I'm loving SBSI. Stock dividends, special dividends, regular increases, and what looks to be a smart acquisition. What's not to like?
Best wishes.
Yes I've been very pleased with SBSI as well. Might have to think about adding more if it keeps dropping.
DeleteCI,
ReplyDeleteI don't really get it? What if there is a pull back in GE (due to being overvalued in your opinion)? You'll lose that yearly dividend with just a few points change? Does it just not matter since you'll be holding for 10+ years?
I do not believe GE is overvalued. I think it's worth $27.50 therefore a small margin of safety might be there, but it's more or less fairly valued. I would much rather pay a lower price, but a lower price wasn't available and I had a purchase to make. GE looked good enough, but not spectacular. I felt it was one of the best options available. Maybe I'm right, maybe I'm wrong.
DeleteWhy should I care about going for capital gains? That literally makes no sense because I refuse to sell assets to fund a retirement. Therefore portfolio value doesn't matter. Only a safe and rising income stream is important. However I do intend to construct a diversified portfolio, and I do want to get the most income I can out of the companies I want to own. That's why purchase price most be considered.
I realize most investors plan to use the 4% rule and focus on capital gains/total return because of it. I might be buying the same stocks, but I'm not using the same strategy. Heck if I was interested in total return, I'd go with index funds from Vanguard. It works, and it's so much easier. But those index funds stink for income (and have fees).
Anyways that is really good question. Yes I plan to hold GE for 10+ years. Yes, you are right that a total return investor who tries to time the market might not want to buy stocks at the moment!
after most of my GE appliances broke (my 7 y.o. GE washing machine flooded my downstairs, my GE dishwasher didn't wash my dishes at all, so I had to replace it), I personally disliked this company and promised myself never buy this brand again. So I was not even looking into this stock at all, but after reading your description and all other positive comments I went and researched GE. I was very surprised to find how much more GE than just appliances. Thanks for sharing.
ReplyDeleteYes GE does a lot more than just appliances though that's what they're famous for. In the past I was fearful of the finance businesses which wrecked havoc on the company a few years ago. GE is shedding much of its financials right now. I like that!
DeleteGE, SO and PG are my kind of stocks. Great dividend growth with some pretty high yield to boot. I am looking to add to my GE as well. Perhaps next month. I was going to purchase some this month but swapped out GE for AFL. GE's PE seemed a drop to high for me at these levels. I do like it at $25 and below. But who knows, I may just bite even at these levels.
ReplyDeleteI'm with you. GE is still a small position for me and I do plan to buy more. Hopefully closer to 25. Have a great week!
Delete