DGI for the New DGI'er close to retirement

[rnsmth]

(03-10-2014, 07:40 AM)hendi_alex Wrote: I'm talking about current market yield on current market NAV of a DG type of portfolio. Very few DG stocks yield north of 3% right now, so how does a person average 3.9% or higher on such. If a person includes some MLPs, telecomm, REITs, etc. 4%-5% is easy enough to achieve, but very few seem to be including those categories as DG types of stocks. Most have histories that are too short, market cap is too small, dividend increases have been inconsistent, etc. So I guess that at this point, perhaps it would be useful for someone to define DG stock as a category.

I have no desire to go into a definition thing.

There are REITs and utilities that have an adequately long history of paying dividends and increasing those dividends. I find it useful to look at individual companies rather than to make overall statements about those sectors

In utilities I hold AVA, D, LNT NGG, SO, WEC.

REITS - OH, OHI, DLR and ARCP

Telecom - BCE and RCI

No MLPS, but I hold two general partners, KMI and SE

I cannot imagine building a dividend growth portfolio without holdings in these areas.

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By NAV, do you mean share price? The only context I have seen NAV in widespread use is in close-ended funds and I am not sure what you mean by it.

thanks

Ron

[hendi_alex]

I mean the dividend flow divided by the current market value of the holdings. I can see how you are achieving your yield as your portfolio seems to represent a nice array of traditional income stocks. However, Utilities, REITs, and Telecom are usually not given much respect in the DG realm. These traditional widows and orphans stocks tend to be low growth, higher yielding income stocks, but generally don't pass muster as DG stocks.

Look at the names that dominate forum for individual DG stocks. Tickers like WMT, KO, PG, PEP, TGT, SMJ, MCD, AAPL, IBM, QCOM, DE, CAT, etc. are the main topics of discussion. I have posted a few threads there, tossing out ideas that are outside these typical DG tickers, including stocks such as O, KMI/KMP, SDRL, and REITs in general. But I don't get the feeling that other than the cigarette companies, most of the pure DG investors here are getting a current market yield of anywhere close to 4%.

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My current holdings: AA AAPL BTU CCJ CSCO CSG ECA GE HCP INTC KMI MCY NAT O OB ORI PAA POT RYN SDRL SNH SPH SSL T TGP

I'm into dividends but am not very patient with the prospects for a DG portfolio. I am eager for current cash flow now, not cash flow in 30 years! As DG stocks get beaten down into extreme value range with yields north of 4%, maybe 3% for a few, I'll add some to my long term portfolio. For now, the portfolio kicks out over 6% cash flow, and I patiently wait for future opportunity in the DG realm.

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The portfolio kicks out about 3.9% in dividends and kicks out much more from call and put sales.

[rnsmth]

(03-10-2014, 08:33 AM)hendi_alex Wrote: I mean the dividend flow divided by the current market value of the holdings. I can see how you are achieving your yield as your portfolio seems to represent a nice array of traditional income stocks. However, Utilities, REITs, and Telecom are usually not given much respect in the DG realm. These traditional widows and orphans stocks tend to be low growth, higher yielding income stocks, but generally don't pass muster as DG stocks.

Look at the names that dominate forum for individual DG stocks. Tickers like WMT, KO, PG, PEP, TGT, SMJ, MCD, AAPL, IBM, QCOM, DE, CAT, etc. are the main topics of discussion. I have posted a few threads there, tossing out ideas that are outside these typical DG tickers, including stocks such as O, KMI/KMP, SDRL, and REITs in general. But I don't get the feeling that other than the cigarette companies, most of the pure DG investors here are getting a current market yield of anywhere close to 4%.

---

My current holdings: AA AAPL BTU CCJ CSCO CSG ECA GE HCP INTC KMI MCY NAT O OB ORI PAA POT RYN SDRL SNH SPH SSL T TGP

I'm into dividends but am not very patient with the prospects for a DG portfolio. I am eager for current cash flow now, not cash flow in 30 years! As DG stocks get beaten down into extreme value range with yields north of 4%, maybe 3% for a few, I'll add some to my long term portfolio. For now, the portfolio kicks out over 6% cash flow, and I patiently wait for future opportunity in the DG realm.

Later on I will provide the dividend growth rates for those companies. I suspect they may be better than you think. I also guess we are easing different information about holdings in DGR portfolios. I would never own ED, for example, due to low dividend growth (or T, for that matter). I am happy to hold WEC, LNT, and BCE though.

DG investing is about building a portfolio company by company.

[rnsmth]

Ticker Yield Dividend
Increase YoY
AVA 4.3% 4.1%
D 3.5% 6.7%
LNT 3.8% 8.5%
SO 4.8% 3.6%
WEC 3.6% 14.7%

There are the utilities, except NGG. It is a British company that pays twice a year. We'll see what they announce for the August payment and then calc the YoY increase.

(03-10-2014, 07:56 AM)rnsmth Wrote:

(03-10-2014, 07:40 AM)hendi_alex Wrote: I'm talking about current market yield on current market NAV of a DG type of portfolio. Very few DG stocks yield north of 3% right now, so how does a person average 3.9% or higher on such. If a person includes some MLPs, telecomm, REITs, etc. 4%-5% is easy enough to achieve, but very few seem to be including those categories as DG types of stocks. Most have histories that are too short, market cap is too small, dividend increases have been inconsistent, etc. So I guess that at this point, perhaps it would be useful for someone to define DG stock as a category.

I have no desire to go into a definition thing.

There are REITs and utilities that have an adequately long history of paying dividends and increasing those dividends. I find it useful to look at individual companies rather than to make overall statements about those sectors

In utilities I hold AVA, D, LNT NGG, SO, WEC.

REITS - OH, OHI, DLR and ARCP

Telecom - BCE and RCI

No MLPS, but I hold two general partners, KMI and SE

I cannot imagine building a dividend growth portfolio without holdings in these areas.

---

By NAV, do you mean share price? The only context I have seen NAV in widespread use is in close-ended funds and I am not sure what you mean by it.

thanks

Ron

[Dividend Watcher]

(03-10-2014, 08:33 AM)hendi_alex Wrote: However, Utilities, REITs, and Telecom are usually not given much respect in the DG realm. These traditional widows and orphans stocks tend to be low growth, higher yielding income stocks, but generally don't pass muster as DG stocks.

Alex, I agree with you. They don't get the "press" that other DGI stalwarts do. I still consider them dividend growth stocks as long as they're well chosen.

My thoughts are slowly evolving on those industries. In the last year, I've added some utilities and REITs. Both the wife and I have held telecoms, specifically T and VOD (now gone), for several years. I added TU and RCI during the Verizon scare last year and have been happy with them despite the currency issue. I know over a several year period the exchange rate yo-yo will even out.

As I approach my 60s, I think it's becoming prudent to add more of these slower growers with the higher yields although I'm still hanging on to some of those faster growers. Counting on them for the following 20 years also.

I think the most important part is to have a plan and a projected budget. Am I sounding like a broken record here? We don't live high on the hog so achieving an income greater than what I made whilst working seems excessive to me. As I've said before elsewhere, we are on target for living comfortably in our "older age".

[CritMass]

And living comfortably in "older age" is certainly what it is all about.