Help the old guy start a DGI portfolio

[EricL]

My parents recently rolled over a 401k and were looking for income ideas.

Here is a list of dividend stocks I put together for them for a shopping list:

[fenders53]

(09-07-2018, 08:55 AM)EricL Wrote: My parents recently rolled over a 401k and were looking for income ideas.

Here is a list of dividend stocks I put together for them for a shopping list:

Sounds like they are in the same current situation, and you and I seem to think alike based on your list.  I want to own some of those companies soon.  Market is heading down slowly and good for nibbling.  I can't sit on my hands forever.  This is fun and like my wife shopping at the mall until I run out of money to invest.  

Today's moves so far...

I have always desired to own MMM but never pulled the trigger due to PE.  It was a lost opportunity for a stable stock in retrospect.  Just sold an OCT 19th 210 put today while it is trading around 212 today.  Maybe l will own 100 shares soon, and if not there is $410 sitting in my account that is mine.  I am very comfortable with this decision longterm.  I'll probably continue to sell puts until the market turns against me and I am "forced" to own MMM on my terms. 

SO ran away from me yesterday.  I have little confidence in share price appreciation so I hope it pulls back and I will grab that awesome dividend.  I love 4.5% dividends but SO competes with XEL for my utility money.  XEL dividend is rarely at 4% but without looking up the stats I think I can safely say XEL price appreciation exceeds SO by 3X and that includes some hard times.  I prefer some diversity rather than go all in on XEL for my total utility investments.  XEL is high now so I wait for a good decision.   SO is clearly being daytraded by speculators now. Random utility companies with no big news do not swing 2%+ per day when the sector is otherwise somewhat stable. Tempted to place my buy orders at my price and go just fishing lol.

I continue to watch T like a hawk.  Let it have another bad week and I will sell a put quick and get in where I want.

This patience thing is hard sometimes.

[NilesMike]

I would not wait if you like T. The last time the yield was this high was 2010

[fenders53]

That is probably very good advice. I won't be pleased if it slips away. A partial position now could be added too later if it does drop another dollar or so as I expect it may.

[NilesMike]

(09-08-2018, 09:51 PM)NilesMike Wrote: I would not wait if you like T. The last time the yield was this high was 2010

...and poof it's $3 higher.

[fenders53]

I missed T several times with limit day orders.  I was trying to buy it under $32.  I'll blame my brokerage companies for taking a month to transfer my accounts.  We'll see if I get another chance or not.  It is especially volatile around option expiration which is pretty much every Friday.

[fenders53]

I am going to add a modest position in F Ford today. I am certain it's going to be a bumpy ride and not for the faint of heart, but I think the free fall is close to over barring market calamity. I have followed them forever. It's almost certainly a yield trap right now as the DIV is likely to be slashed some next year, but should still remain above average. For those that aren't aware, F pays large special and unexpected dividends when times are good. Insiders paying themselves back for holding? I don't know of course but it happened more than once. Anyway, I don't recommend F to others now but they haven't failed me yet if I buy when the factory is on fire. They had the good sense to self correct prior to the automaker bailout 10 years ago. I don't see F going away. An American icon company. I truly hope the GOV doesn't have to help the industry again but I'm confident they will if necessary.

[EricL]

Not a fan at all of Ford as a stock. It's had flat earnings for 20 years, and no growth prospects in sight. It also has several dividend cuts in its history, making the 7.8% yield pretty questionable. If the company is struggling this much to grow in a good economy, what do you think will happen when we hit the next recession?

[fenders53]

F is speculative for sure. Any automaker is currently risky. GM is sucking wind too. The whole industry is so cyclical and you have to be a fool to not trim positions during good times. TESLA trades at about $300. Do they even have a PE? Ford made more actual profit selling the Model A 90 years ago. I'm just playing Eric. I'll share my F basis and we'll talk about this in two years. F dividend will almost surely be cut in 2019. I'll probably chicken out and just sell puts now to lower my basis even further. I keep my speculative plays at less than 3% total portfolio. As I said I am NOT suggesting anyone follow in my path. But I will be sure to brag if it works out. Fair enough?

[EricL]

(09-13-2018, 12:15 PM)fenders53 Wrote: F is speculative for sure. Any automaker is currently risky.  GM is sucking wind too.  The whole industry is so cyclical and you have to be a fool to not trim positions during good times.  TESLA trades at about $300.  Do they even have a PE?  Ford made more actual profit selling the Model A 90 years ago.    I'm just playing Eric.  I'll share my F basis and we'll talk about this in two years.  F dividend will almost surely be cut in 2019.  I'll probably chicken out and just sell puts now to lower my basis even further.  I keep my speculative plays at less than 3% total portfolio.  As I said I am NOT suggesting anyone follow in my path.  But I will be sure to brag if it works out.  Fair enough?  

Not going to fault anyone for making a spec play or two. Best of luck with the buy, we'll check back in on this in 2020!