Cemanuel 2022 Portfolio Thread

[cemanuel]

Plan for the day. I've finished up my IRA buying. Anyone wanting to see the final product, it's here: Filling my IRA

In reviewing stocks for my IRA one surprise was WHR. I own it in my Roth, first bought in January, 2021. Now at the time I bought it my plan was to manage that account similar to my taxable account; for dividend income. That changed later in the spring when I ran some tax scenarios. The Roth then became more of a TR/growth account.

I went into the IRA buying thinking of WHR along the same lines as BBY and WSM. Nice TR companies with some solid growth numbers, growth prospects, and a good record of dividend increases. Looking at numbers, this is wrong. WHR certainly has the dividend hike thing going on, include its most recent, but it doesn't have a lot of revenue growth in its history and I don't see those prospects changing.

So I have two moves planned for today, both involving it:

In my Roth: Sell WHR, replace it with KLAC. Of growth/TR prospects, KLAC is the company trading at the greatest discount to my target price.

In my Taxable Account: Sell some PFE - about 30%, replace with WHR. Neither are high growth companies but WHR actually has a higher yield right now and absolutely stomps PFE when it comes to dividend growth. I debated completely swapping them out but a) I still like PFE and b) I have pretty hefty gains. I can manage the taxable event with the T shares I still hold at a loss but it's easier with a partial sale - selling the T spinco (no divs, that decision is easy) will take care of some of it and I can look at doing something else if gains remain.

Or not. It's not like paying some LT cap gains will break me.

[fenders53]

I do like WHR, but it's cyclical. Better purchased when the economy is flat and it's yield is very high. Yeah I am predicting the future but it's likely. Collect the dividend and perhaps sell it a few years later if it has a strong run like it did. Certainly not a growth stock like KLAC should be the next few years at least.

[cemanuel]

The Deed is done: Copy/Paste from SA.

Today's trades:

Roth - TR account but these all pay dividends:

• - Sold WHR at $189.15
  
• - Bought KLAC at $315.89
  
• - Bought MU at $74.98
  

Taxable Account, DGR/income Account:

• - Trimmed PFE, about 30% of it, at $48.00
  
• - Bought WHR at $190.89
  

Should add growth in the Roth, higher income and dividend growth in the Taxable Account. This was my first Taxable Account transaction of the year. Guess I really am becoming more buy-and-holdish.

And as usual I did it backwards. Sold WHR for less first than I bought it for later. Though I was waiting for PFE to come back to $48.

[fenders53]

(03-08-2022, 12:23 PM)cemanuel Wrote: The Deed is done: Copy/Paste from SA.

Today's trades:

Roth - TR account but these all pay dividends:

• - Sold WHR at $189.15
  
• - Bought KLAC at $315.89
  
• - Bought MU at $74.98
  

Taxable Account, DGR/income Account:

• - Trimmed PFE, about 30% of it, at $48.00
  
• - Bought WHR at $190.89
  

Should add growth in the Roth, higher income and dividend growth in the Taxable Account. This was my first Taxable Account transaction of the year. Guess I really am becoming more buy-and-holdish.

And as usual I did it backwards. Sold WHR for less first than I bought it for later. Though I was waiting for PFE to come back to $48.

The market is mean sometimes.     I sold an EOG put literally 10 minutes before an analyst downgraded it this morning, and dumped the shares 7pts.  Right at my strike price.  

And I had no idea WHR had corrected that hard or I wouldn't have made my previous comment.  I looks attractive enough here.  Back on my watchlist.

[cemanuel]

The price dip was nice but it was the 25% dividend increase that made it really interesting. 3.7% yield with that hike? Not a hard choice next to PFE. Not that Pfizer is bad - still have a chunk - but I don't expect a lot from it, either price or dividend raises, going forward.

[fenders53]

We have held PFE in my wife's Roth over 25 years. Don't sugarcoat it lol, it's been an underperforming dog until recently. Probably OK for a man of your age though.

[cemanuel]

(03-09-2022, 08:40 AM)fenders53 Wrote: We have held PFE in my wife's Roth over 25 years.  Don't sugarcoat it lol, it's been an underperforming dog until recently.  Probably OK for a man of your age though.

I've always been able to buy it yielding 4% or more which is the key number. In fact, buying it last June at $$39 was the last taxable account buy I made from dividends before I quit buying to build cash. But the latest dividend hike was disappointing. I could sell more but I'm up 40% on it. Need to see what the tax hit from yesterday is first. But with the big drop in a lot of growthier companies that pay dividends, if I can manage the taxes it's a good time to swap.

[fenders53]

(03-09-2022, 09:16 AM)cemanuel Wrote:

(03-09-2022, 08:40 AM)fenders53 Wrote: We have held PFE in my wife's Roth over 25 years.  Don't sugarcoat it lol, it's been an underperforming dog until recently.  Probably OK for a man of your age though.

I've always been able to buy it yielding 4% or more which is the key number. In fact, buying it last June at $$39 was the last taxable account buy I made from dividends before I quit buying to build cash. But the latest dividend hike was disappointing. I could sell more but I'm up 40% on it. Need to see what the tax hit from yesterday is first. But with the big drop in a lot of growthier companies that pay dividends, if I can manage the taxes it's a good time to swap.

The 4 1/2% total return for decades was the problem.  Dividend means little when that is about all you are getting in a long bull run. It's been simple to make PFE money the past year.   I did a 5X on my share count in another account then but I've been out a while.   I think it will finally be a decent stock going forward but it's been WAY below average for 20 years.

[cemanuel]

Dividend means little when that is about all you are getting in a long bull run.

I disagree. When the goal of an account is to generate dividends, dividends mean everything. Nice to get some cap gains - and they usually come - but that's not really the point. 

[fenders53]

(03-09-2022, 10:26 AM)cemanuel Wrote: Dividend means little when that is about all you are getting in a long bull run.

I disagree. When the goal of an account is to generate dividends, dividends mean everything. Nice to get some cap gains - and they usually come - but that's not really the point. 

It's OK we disagree.  I've just never been pleased with zero cap gain for decades.  Zero is a really small number.  I want a little something for my risk of holding an equity.

[cemanuel]

(03-09-2022, 10:36 AM)fenders53 Wrote:

(03-09-2022, 10:26 AM)cemanuel Wrote: Dividend means little when that is about all you are getting in a long bull run.

I disagree. When the goal of an account is to generate dividends, dividends mean everything. Nice to get some cap gains - and they usually come - but that's not really the point. 

It's OK we disagree.  I've just never been pleased with zero cap gain for decades.  Zero is a really small number.  I want a little something for my risk of holding an equity.

No problem. This nice thing is that with the right company cap gains usually come. But I don't mind having some where it doesn't - VZ for example. I've only owned PFE since 2018 so I haven't been displeased though if I were starting out without having to worry about taxes I wouldn't be buying it now.

I suspect in the not too distant future I may balance sales of it with T sales to cover cap gains. Though I'll have do some math. Selling spinco as if it were a special dividend counts for something too. But after the last few weeks I'm about math'd out for a bit. 

Debated doing some IRA stuff yesterday with the big drop, decided one day after I finished buying for it was a bit quick but there was some stuff cheap. It was very tempting to go overweight some shares and sell once they take back 20-30%. I'm not sure big drops are finished with what's going on - February CPI is tomorrow plus geopolitical - so I may organize myself for the next one.

[cemanuel]

Today's trade will likely be selling LMT and buying LOW in my IRA. LMT was a "just OK" stock in the IRA. Solid defense company, decent growth - really good for DGI but slower growth than my "ideal" IRA company. But I knew I'd be light on industrials. LOW is growing more quickly recently - this may slow down a bit in the immediate future and nicely priced.

My IRA price for LMT was $400 so I just got the one buy of it. Could it go higher considering what's going on? Yes but I expect this would be more marginal and that the big gains are already in. Plus I have 39 companies in the IRA. This isn't a "problem" but my Taxable Account is much larger and has 22.

LOW is not a lock as the buy. There's a CPI report due this morning which could agitate the market and something "growthier" could drop to my price. But as of now it's the top candidate. The one other company at current prices could be AOS. I'd keep my industrial "stake" and it has over 10% revenue growth and the Chinese do like their hot water units. But it's less likely to give the TR gains than, say, MU (if it dips back under $75) would provide.

I own LMT in my Taxable Account and a lot more of it. I won't be doing anything with it there.

I haven't completely figured out what to do with FB. It's another company I have a single buy of, and not because of the price. Looking at the financials, it's cheap. Heck, it's dirt cheap. But under the Investing Dictionary entry for Headwinds there should be a picture of Zuck. Everyone hates it (except maybe a few grandparents who like seeing grandkid pictures) including politicians and there's that nice little DOJ trial in its future. But when sentiment is lowest is when you can sometimes get the best deals. Still, I'll probably just stick with my one buy even though I think there's a very good chance I could make a buy here, consider those trading shares, and sell at $250 at some point in the next few months. I may become more comfortable with the idea now that I've actually typed it out.