Tuesday, July 17, 2018

Recent Buy, July 2018

Reunion Gremlin here to talk about a recent buy.  Over the weekend was family reunion time, which is always fun and exciting.  Sure it requires a good bit of driving, but its important to see people you care about - even more so when they are scattered about the globe.  Before we left on this journey I added to an existing stock position.  This was partly fueled by the merger of Dr Pepper Snapple (DPS - formerly) with Keurig to form Keurig Dr Pepper (KDP).  I will continue to hold my new shares of KDP, I do think there is value in the combined company.  Now to the proceeds, what did I buy with them?

Last week, I added to an existing position by purchasing shares of Kraft Heinz Corp. (KHC) in my taxable account.  I bought 17 shares, with a total cost of $1,087.81 ($63.58 / share, plus commission).  The current yield is 3.88%

This purchase nicely rounds out this position, and is in addition to KHC shares I hold in my Roth account.  I am not going to rehash the fundamentals of this stock as it is an existing position.  However, it is in an industry that will always be in demand - food.  Sure they are a little bit of an aged giant, but they have the ability to add newer products and acquire new brands.  I suspect that KHC, and its competitors, will continue to gobble up smaller / healthier products until each has its own respectable portfolio of these items.  Each added product might not move the needle on its own, but collectively I suspect companies will be seeing ever higher profits in the long run as trends continue.

This purchase will add $42.5 to my forward 12 month dividend income.

I will update my portfolio page at the end of the month.

What do you think of KHC? 

- Gremlin
- Long KHC and KDP

Monday, July 2, 2018

June Review / July Preview, 2018

Beach Bod Gremlin here to talk about June and look towards July.  June in someways was, thankfully, a lazy month with a few plan-less weekends and only 1 trip (to a wedding).  It was nice to slow down a little and enjoy some quiet time.  The baby continues to grow rapidly, and he will soon be mostly mobile - a scary thought for the uninitiated.  Meanwhile the World Cup marches on, and it has been full of some awesome upsets.  Its great to watch new teams win, makes the whole thing more exciting when none of your teams remain.

July should an interesting month.  We have the 4th of July, a family reunion, and a week of dog sitting in the cards.  Sadly, it won't out perform June in dividends...

June:

This month I made no new stock purchases.

Last month I brought in a total of $384.54 in dividends ($157.37 taxable, $84.31 Roth, and $142.85 IRA).  This is an increase from last year ($298.63 total) by 28.7%. This is my biggest month ever, just edging out last March.

In terms of dividend increases, I realized* 5 raises from Pepsico (PEP), Sonoco (SON), Unilever (UL), Johnson and Johnson (JNJ), and Exxon Mobil (XOM).  The increases range from 5% to about 15% (mostly around 5-7%).  I have now realized 32 raises thus far this year.

Next month I will realize two raises from Realty Income (O) and Leggett & Platt (LEG).  The increases are 0.2% to about 5%, respectively.

* I only count increases when realized, because until that money is delivered any statements or declarations are simply conjecture.

July:

The mortgage continues, so at least part of our 'rent' counts towards our house. Our debts currently outstrip our assets (I choose not to count the house as an asset).  Outside of our house, we still have very low interest auto debt (1.9 and 1.5% for our cars).  Both my car and house are receiving slightly out-sized payments monthly.  We are effectively eliminating debt, while still building and assets.  Even on just one income (for now).

July has a small family reunion, which should be an interesting time, otherwise I am hoping for a little bit of boredom - its nice to unwind sometimes.

My next buy will occur after the closure of the Dr Pepper Snapple (DPS ) - Keurig / Green Mountain merger - July 5th - which is nice.

Next month should produce around $82 in dividends, which is a 12% YOY increase.

My portfolio page is currently up to date.

Hope everyone has a great June.
- Dividend Gremlin
- Long all stock tickers mentioned

Tuesday, June 26, 2018

Gremlin's Asset Review - 2018

Bookkeeping Gremlin here to discuss my net-worth.  I first made this type of post a year ago, because its my birth month so I might as well see how current me compares to newborn me (financially).  This is something I like to do on annual basis to help me gauge what kind of progress we are making towards financial independence.  This report honestly is the not best I have ever had, but there are glimmers all over the place and it will not take decades to correct the issues that remain on my personal balance sheet.

Debts:

Debt sucks, period.  Most people accept debt as normal and expected, but that is crap.  Still, I have debt though, and am working on crushing it.  So here goes:

Car #1* (my car): $7,198 (maturity: 6/2021, $250 / mo.) interest = 1.9% ($2831 reduction from last year)
Car #2 (her car): $12,585 18,044.33 (maturity: 10/2020, $475 / mo.) interest = 1.5% ($5459 reduction from last year)

Mortgage: $329,855 ($2100 / month, 30 year, 4% interest)
Family Cash: $30,000 - a family obligation 0%, no timetable (help received purchasing our house)
Revolving debt / credit cards: No balances carried or maintained, used as debit cards with credit points.
Total monthly debt payments = $2825
Total debt: $379,638

Currently, we pay my wife's car in exact amounts, and I pay a little extra on my car and our house.  I count our house exclusively as a debt.  Could it be an asset? Yes, but at the moment its a little more important than that.

* - I almost sold my car, but due to work family and obligations, doing so would be a real problem.

Income:

My wife took the end of last year off to spend time with the baby, and will head back to work at the end of this summer.  Last year our total income was approximately $110,000 before taxes.  This year our expected income is closer to $94,000.  Her return to work, coupled with a very conscious effort on my part to cut expenses should help me to eliminate debt and make purchases of stock.

Expected income (2018):
My main job: $80,000
Wife: $14,000
My side gigs: $1,000
Total: $95,000

Looking forward to the second half of this year is a very pleasant thought.  Our income will balloon, savings will grow, and we will focus extra cash on more stock.  Additionally, I will like to dispose of one of my car loans.

Assets:

This is the fun part.  Current assets that are to be considered are my taxable investments, Roth IRA, IRA, 401K, and other retirement savings.  Cash, Health Savings Accounts, and miscellaneous assets are not counted unless they fit into another category.  I work to shield liquidity this way, and separate out what is needed versus what can be invested.  Assets including cash in investment accounts:

Taxable Invested Assets: $39,775
Roth IRA: $20,078
Traditional IRA: $38,468
401K: $19,305
Wife's Retirement / Pension: $15,416
Total = $133,042 ($32,195 total growth)

At the beginning of 2015 the total stood at $47,000.  At the end of 2015 it was $54,000, and at the end of 2016 it was $87,000.  Since the start of 2016 both my rate of investment and the market have been on tears.  Purchasing a house will stifle this, but only briefly.  This past month is the first time our total assets broke $100,000, so time to double down.  It is my goal to make this number hit $145,000 by end 2018.

Total Net Worth = (-$246,596)

Goals:

Last year I wanted to increase my income and investments, and decrease non-housing debt.  That was a success.  So I want to now lay down concrete debt related goals to reach before my next birthday.
1 - Begin retiring some of my family debt.
2 - Eliminate a car payment.
3 - Networth approaching or above $-230k.

Conclusion:

At the moment we are doing well relative to our peers.  However, though our peers represent a good metric, they are not what I want to use to measure my life's progress.  The primary drive is to achieve financial independence in a meaningful way - that independence would then be leveraged to pursue work and life goals that my current 9-5 does not give me time the time to chase.

- How is your net-worth coming along?  Buy a house recently?
- Gremlin

Wednesday, June 13, 2018

Gremlin's 2018 Soccer Call...

Sports Gremlin here, been a while since I've been around, but I have time for a quick visit.  Where has the time gone?  Seems it was just yesterday I was watching Germany win a World Cup, Portugal a Euro, and watching the US Men's team flame out in spectacular fashion - sigh.  That is just soccer, there have been tons of other sports, life, investing, and other moments which have come and gone.  Now the next World Cup is upon us all, so comes time for a quick review.

This year I will not be making any calls.  Last time, the teams seemed a bit more straight forward in terms of who was dangerous, who will play well below their means, who were the powerhouses, etc.  The field this year is much more level than years past.  The usual heavy weights - Germany and Brazil are here to play.  France, England, Spain, and Argentina are all there too, who along with Uruguay round out the past winners.  Italy did not even make the field!  Those are the 'traditional' powerhouses.  Of them, Brazil looks like it will struggle, Spain fired its coach a day before kick off, the German Machine's cogs are getting a little older, and Argentina's stars are even older than the cogs.  France has some amazing players, but they seem to also have huge egos that might beat them before the step on the field.  England looks to be in great form, however it seems this always happen right up until they blow it.  Uruguay has not been dangerous since 2010.

Then there are the dangerous teams no one wants to play - Egypt (looking at you Salah), Iceland (they create goals from nothing), Belgium, Denmark, Senegal*, Poland*, Colombia*, etc.  The presence of one of these teams can easily knockout one of the traditional powers, and most groups feature at least 3 legitimate contenders.  * - all in the same group

So enough kicking the dirt on this.  I think there are several likely outcomes:

1 - Russia makes it through the 1st round.  Russia, the host, is not highly rated, but only one host ever, South Africa, did not advance beyond the opening round.  I think that will trend will continue.
2 - Something stupid happens with a crowd.  Soccer fans are just prone to this, and I speak from first hand experience.  That being said those crowds are in Russia, so its like mixing an acid and base.  My call here is that the games should look pretty good on TV.
3 - France, Germany, England, and Brazil are the favorites.  I would guess one of them wins, but also likely is that a new team wins this year.  I would add Poland, Colombia, and Belgium to the likely final 8 teams (pending bracket shake out).
4 - Enjoy the game.  This is my favorite sporting event.  The field is wide open (dammit USA), and it should be a great spectacle.

Will you watch?  Is there someone you want to see win... or lose?

- Gremlin
- going to go Long Germany on this one...

Thursday, May 31, 2018

May Review / June Preview, 2018

Tired Gremlin here to talk about May and peer forward into June.  Kids make you tired, that is a straight fact, if you're not tired you should own stock in Starbucks (SBUX) or Dunkin Donuts (DNKN).  Between work, home, hobbies, and everything else that fills the air it was nice to recently have a long weekend.  I've heard it said people cannot catch up on sleep, but that doesn't mean we won't try.

Looking past rainy and busy May, June is a big month.  My favorite sporting event starts- the World Cup.  Its my birthday - a bittersweet reminder that I am not 23 anymore.  The weather has finally gotten nice, minus the rain, so its high time to spend more moments outside.

May:

This month I made one purchase, adding shares of Kimberly-Clark Corp. (KMB) in my IRA account.

Last month I brought in a total of $267.98 in dividends ($57.07 taxable, $62.91 Roth, and $148.00 IRA).  This is an increase from last year ($246.08 total) by 8.9%.

In terms of dividend increases, I realized* 4 raises from the Gap (GPS), Ameriprise Financial (AMP), Kinder Morgan (KMI), and General Dynamics (KMI).  The increases ranged from5% to about 60%.  This includes KMI coming back to life.  I have now realized 27 raises thus far this year.

Next month I will realize five raises from the Pepsico (PEP), Sonoco (SON), Unilever (UL), Johnson and Johnson (JNJ), and Exxon Mobil (XOM).  The increases range from 5% to about 15% (mostly around 5-7%).

* I only count increases when realized, because until that money is delivered any statements or declarations are simply conjecture.

June:

The mortgage continues, so at least part of our 'rent' counts towards our house. Our debts currently outstrip our assets (I choose not to count the house as an asset).  Outside of our house, we still have very low interest auto debt (1.9 and 1.5% for our cars).  Both my car and house are receiving slightly out-sized payments monthly.  We are effectively eliminating debt, while still building and assets.  Even on just one income (for now).

June has 1 wedding on the calendar and the start of the World Cup.  Between the World Cup and my annual net-worth review, I should have more updates than usual.

My next buy will occur after the closure of the Dr Pepper Snapple (DPS ) - Keurig / Green Mountain merger (should be this month).

Next month should produce around $372 in dividends, which is a 24% YOY increase.

My portfolio page is currently up to date.

Hope everyone has a great June.
- Dividend Gremlin
- Long all stock tickers mentioned

Thursday, May 10, 2018

Recent Buy, May 2018

Pollen Gremlin here to chat about a new buy.  Its spring and that means pollen is in the air, so allergy meds are in my system.  Its the biggest downside of nice weather, and the main reason spring ranks as my least favorite season.  In between sneezes its been a busy time here.  I also just completed another short bit of work travel and there is a laundry list of things that need to get done at home.  It will be nice in the future when baby Gremlin finally can help out with some of those - especially the sneeze inducing ones.  In particular his job list will include dusting, as it is the singular chore I despise above all others.  Anyways, what did I buy?

A few days ago, I added a new position by purchasing shares of Kimberly-Clark Corp (KMB) in my IRA account.  I bought 10 shares, with a total cost of $1,039.57 ($103.26 / share, plus commission).  The current yield is 3.83%.  The P/E ratio for KMB sits today at approximately 16.19, trailing.  The yield is slightly above the 5 year average of 3.4%, and P/E is well below its average of the past 5 years (28.35).  KMB has a trailing payout ratio of approximately 58% (it seems be reported between 55 and 65%, with some stating 77% - likely a skew from taxes at the end of 2017).  KMB is a dividend champion, having paid increasing dividends now for 46 years.  Its long term average dividend raise is around 7%, however recent increases tend to be between 4 and 6% - with the most recent being just above 3%.

What does KMB do in their own words:

Kimberly-Clark is a leading manufacturer of personal care (around half of sales) and tissue products (roughly one third of sales). Its portfolio of brands includes Huggies, Pull-Ups, Kotex, Depends, Kleenex, and Cottonelle, among others. The firm also operates K-C Professional, which partners with businesses to provide safety and sanitary products for the workplace. Kimberly-Clark generates slightly north of half its sales in North America and more than 10% in Europe, with the rest primarily concentrated in Asia and Latin America.

KMB is a $36B company, which produces a bunch of consumer staples.  Consumer staple stocks have been beat up of late, they are not new or cool.  There is no fast or flashy money to be made.  That being said, KMB is surely feeling the squeeze other old consumer stocks are - new organic / hypoallergenic (among other things) products, lower price points of generic breads, and less millennial brand recognition.  At least that is the drum that is beaten today about these types of companies - neglecting their general role in those things (lots of store brands are tied to branded items - either in manufacturing or materials) and their general ability to buy up newer / smaller competition.  Companies like KMB are starting to get hard to ignore at these levels.

This purchase will add $40 to my forward 12 month dividend income.

I will update my portfolio page at the end of the month.

What do you think of KMB? 

- Gremlin
- Long KMB

Monday, April 30, 2018

April Review / May Preview, 2018

Busy Gremlin here to talk about how my investments performed in April, and what is expected of May.  April was a very solid month for my investments; while many of my coworkers and friends lamented the roll coaster in the stock market, I just smiled and kept collecting cash. I also smile when any jest is made about how inexpensive my lunches are (never really break $1.50 cost except for rare occasion) and that through my bike and the train my commute is free.  Small savings and side cash, are a formula for success.

April also had some work travel for me.  I am not the biggest fan of work travel, as I have done a lot of it over the years and it can be a drag, however I do try to take advantage to save extra cash and see something new.  Last month as part of my travel I wedged in a brewery visit.

April:

This month I made one purchase, buying shares in the Royal Bank of Canada (RY), while selling legacy holdings Pengrowth Energy (PGH) and Willamette Valley Vineyards (WVVI).

Last month I brought in a total of $74.85 in dividends ($65.85 taxable, $9 Roth, and $0 IRA).  This is an increase from last year ($70.94 total) by 5.5%.

In terms of dividend increases, I realized* 5 raises from the Bank of Nova Scotia (BNS), Canadian Imperial Bank of Commerce (CIBC), Coca-Cola (KO), Realty Income, and Walmart.  The increases ranged from 0.2% to about 5.5%.  I have now realized 23 raises thus far this year.

Next month I will realize four raises from the Gap (GPS), Ameriprise Financial (AMP), Kinder Morgan (KMI), and General Dynamics (KMI).  The increases range from 5% to about 60%. For the record KMI raised their dividend 60%, which is clawing back from the 75% cut they had in early 2016.

* I only count increases when realized, because until that money is delivered any statements or declarations are simply conjecture.

May:

The mortgage continues, so at least part of our 'rent' counts towards our house. Our debts currently outstrip our assets (I choose not to count the house as an asset).  Outside of our house, we still have very low interest auto debt (1.9 and 1.5% for our cars).  Both my car and house are receiving slightly out-sized payments monthly.  We are effectively eliminating debt, while still building and assets.  Even on just one income

Hopefully May is a quiet month, but I would not hold my breath.  Nothing gets quiet, slows down, or goes exactly according to plan when you have a baby.  That being said, none of those concerns are a bad thing!

I should have a buy in my IRA, but I might old off until June depending on the market prices and closure of the Dr Pepper Snapple (DPS ) - Keurig / Green Mountain merger.  In addition, I will likely write a quick historical analysis relating the stock market, business cycles, and historical revolutions.  If that sounds weird to read, it felt weirder to type, but it will all wind itself together in a rational sense.

Next month should produce around $270 in dividends, which is a 9.5% YOY increase.

My portfolio page is currently up to date.

Hope everyone has a great March.
- Dividend Gremlin
- Long all stock tickers mentioned (except PGH and WVVI)