September Dividend Income: It Used To Be A Low-Growth Month. But Now +57% YoY!!!

The third quarter is in the books, folks. Time flies when you’re having fun. And while having fun, the compounding effect of investing and reinvesting our increasing dividends is getting bigger and bigger. That’s the real beauty of the dividend investing strategy. It will take care of itself, if and only if we select high-quality businesses. But how do we know whether a company is a high-quality business or not? Well, in 90% of the cases a 50-year streak of paying increasing dividends is a pretty good indicator to start with. It’s as simple as that. Let’s see how September worked out for me.

Income Numbers

The amount of dividend income for month 2019/09 was $153.28. In this month I got raises in dividend income from Bank of America (BAC), Cummins (CMI), Norfolk Southern (NSC), Realty Income (O), Stanley Black & Decker (SWK) and Union Pacific (UNP). That’s quite a list, don’t you think? I also got my first payment by Wells Fargo (WFC).

BAC paid me 30% more than three months ago. Wow! The payment by CMI was 15% higher in comparison with June this year. NSC gave me an extra 9.30% this month. O rewarded me with the traditional, but still very welcome small hike of 0.2%, whereas SWK increased their dividend with 4.5%. This month also included the second dividend raise by UNP, a nice 10.1% increase. A very good month, imho.

Breakdown of Dividend Income

My dividend income of $192.92 for this month was generated by:

Bank of America (BAC) – $7.02

BlackRock (BLK) – $13.20

Cummins (CMI) – $13.11

Emerson Electric (EMR) – $4.90

3M (MMM) – $37.44

Norfolk Southern (NSC) – $5.64

Realty Income (O) – $3.85

PepsiCo (PEP) – $8.60

Southern Company (SO) – $21.70

Stanley Black & Decker (SWK) – $8.28

Union Pacific (UNP) – $5.82

Wells Fargo (WFC) – $13.77

Exxon Mobil (XOM) – $49.59

Progress

My passive income for the month of June 2019 was $192.92. That means an increase of 26% QoQ; that’s pretty significant for my lowest month of every quarter. This month is now really getting somewhere. The progress YoY is even more meaningful; my dividend income for September last year was $122.98. So that’s an awesome increase of 57% YoY. ME LIKE! Let’s look at the graph YTD:

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Buys In September

During this month I bought 9 shares of Johnson & Johnson (JNJ) for a price of $128.22. You can read more about this purchase in my previous article. It still trades at an attractive valuation with a P/E of 15 and a dividend yield of 2.90%.

Dividend Income YTD 2019

Including this month I collected a nice $2,131.25 YTD. My total dividend income in 2018 was $1,793.09. It looks like I’m going to close the year with a FY dividend income just shy of $3,000. Too bad I won’t cross that mark. I really like passing those psychological meaningful round numbers. But that would still imply an increase in FY dividend income of 65% YoY. I could live with that. 😎

Thanks for stopping by and feel free to comment.

Happy investing!

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Watchlist For September 2019

After publishing my August results in terms of dividend income and growth figures, I decided to write down my watchlist for September. Many stocks appear to be overvalued at the moment, especially when you consider their most recent growth rates of revenues and earnings. But if you look closer, then you’re always able to discover some high-quality businesses trading at attractive valuation numbers. Here’s my shortlist:

Johnson & Johnson (JNJ): this one needs no introduction in the dividend investing community. Although the P/E seems to be on the high side, the forward P/E of 15 looks very attractive. Buying this beauty for a price below $130 immediately gives you a nice dividend yield to start with: 3%. Their latest dividend increase was 5.6% and I think management is targeting for such a dividend growth rate in the near future. There’s nothing wrong with that, while cruising through the next economic recession. Besides, they’ve increased their dividends for 56 years in a row; with this company in our portfolios, we’ll sleep well at night. I’ve always considered my portfolio as incomplete without JNJ. Adding this wonderful business to my nest with eggs means some extra dividend income in “my lower income” months. That would be nice.

Simon Property Group (SPG): another REIT? Yes, but one of the best, just like Realty Income (O). I don’t think a retail apocalypse is at hand. Look where Target (T) and Walmart (WMT) are trading at the moment in comparison to, let’s say, two years ago. I’m confident SPG will continue to do just fine in this low-interest environment and during the looming recession. They have a strong balance sheet and will also be able to refinance some of their debt if interest rates stay low. The extra cash could be used to ramp up their share buyback program. SPG also has a credit rating of A or likewise from other credit rating agencies. Their most recent dividend increase was 2.5%. SPG has a streak of 9 years increasing their dividend. This quality name trades at a high 5.5% dividend yield at the moment. Initiating a position in this company increases the amount of money I receive in the months with my highest dividend income.

Other candidates would be Abbvie (ABBV), Altria (MO) and Exxon Mobil (XOM). This would mean increasing my position, which doesn’t feel like the right thing to do as I consider these positions already full positions. Especially relative to other positions in my portfolio. I’m also checking out the big Canadian banks. Talking about steady compounders.

What are you up to? Which names are you looking at? And are you planning to add to or initiate a new position?

Please let me know.

Happy investing!

A Step Back For The Month Of September 2018, DGI Down 11% YoY

After posting my progress for the month of August 2018 I decided to follow up quickly. Today I’m writing about my progress in building up a dividend income during the month of September. My dividend income growth YoY for July was +342% and for August +230%. Ready, set, GO!

Income Numbers

The amount of dividend income for month 2018/09 was $122.98. In this month I got several raises as compared to the dividend payment three months ago. The big Bank of America gave me a nice raise of their dividend with 25%. They have a short, but impressive streak of growing their dividends for 3 years. Very rewarding until now! Cummins paid me 5.6% more than last quarter. The companies Norfolk Southern and Union Pacific increased their dividends for the second time in one year! NSC with 11.11% and UNP with 9.6%. So, I’m pleased, very pleased with that. This month excluded the dividend increase of 14.5% by Delta Airlines (paid in August). This all sums up to:

Bank of America (BAC) – $5.85

Cummins (CMI) – $11.40

Emerson Electric (EMR) – $4.90

General Motors (GM) – $26.98

Norfolk Southern (NSC) – $4.80

Realty Income (O) – $3.74

PepsiCo (PEP) – $8.35

Southern Company (SO) – $21.00

Union Pacific (UNP) – $4.80

Exxon Mobil (XOM) – $31.16

Breakdown of Dividend Income YoY

My passive income in the month of June last year was $137.55 so that’s a decrease of 11%. Too bad, but this has everything to do with my selling of COP, IBM, WFC and WMT during  the end of 2017 and buying stocks which pay their dividends in other months. The big YoY growth in the months July and August come from these moves. The progress QoQ was a -3%. The missing payment by Delta Airlines for September was mostly compensated by the dividend increases of the above mentioned companies BAC, CMI, NSC and UNP.

The dividend income for the month of September leads to the next graph:

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Looking Forward

In order to raise my dividend income for this month going forward I searched the usual pay dates of the companies I love to buy and are om my watchlist. As I wrote earlier, I need to diversify in business sectors, companies and dividend growth rates. I found that Blackrock (BLK), General Mills (GIS) and STAG Industrial (STAG) pay their dividends in the month of September. It’s not the most relevant factor in my decision making process as the focus should always be on quality and valuation, but it’s a nice to bonus if a buy candidate pays a dividend in your months which lag a bit behind other months.

Dividend Income FY2018

We have three quarters of 2018 behind us and I already collected $1,264.43 this year whereas my total dividend income in 2017 was $827.81. It’s truly inspiring to see that the total YTD 2018 dividend income already leads to more than a 50% beat as compared to FY dividend income 2017.

I’m very curious how you did this month. Please share your progress and insights.