Monthly Archives: May 2016

Recent Buy

I’m looking for companies that are fairly valued, have a decent dividend yield(3% to 6%) and have a fairly long history of paying dividends consistently for 10 years or more. However, there could be some cases for exceptionally good company or a strategic buy for a very long term.

1) Abbott Laboratories, Inc. (ABT)

Abbott  manufactures and sells a range of health care products and operates in 4 business segments: pharma, diagnostic, nutritional and vascular products. The company was  founded in 1888 and is headquartered in Abbott Park, Illinois.

ABT has dividend yield of 2.65% and market cap of $57.7B. At its 52 week high, it traded at $51.74 and currently trading at $39.30, almost 20% lower.

I bought 5 positions in ABT at $38.22 on 5/17 and it’ll add $5.20 of passive income on an annual basis.

2) Bank of Nova Scotia (BNS)

I like the Canadian Banks as they have conducted their affairs fairly conservatively in past. There are 3 biggies on the radar: BNS, TD and RY  and adding BNS due to better valuation and yield. I’d recently bought it and this is my 6th addition of positions to that rapid fire sequel of buys!

I added 5 positions in BNS on 5/13 at $48.46. It’ll add $14.40 of passive dividend income on an annual basis. Bank stocks have nicely recovered in last few weeks and appear to be fairly valued in my opinion.

3) GlaxoSmithKline (GSK)

GSK is a British multinational healthcare company that manufactures pharmaceuticals, vaccines and consumer healthcare products. It has presence over a diverse geography in 150+ markets and 84 manufacturing centers in 35+ countries. It has a Market Cap of $95.3B. GSK was founded in 1935 and headquartered in Brentford, UK.

GSK has a nice dividend yield of 5.19% and currently trading at $42.75. It made 52 week high as $44.85. I bought 10 positions in GSK on 5/19 at $41.50 in my taxable account. It will add $22.20 of passive income on an annual basis.

Full Disclosure: Long on above mentioned securities.

Thanks for reading.

What do you think about these buy?

Recent Buy and Sale

I normally do not sell the securities that I’ve purchased in my Portfolios as I’m into it for a very long haul and buy them only after careful consideration, unless, there are some exceptional circumstances as below:

  1. A significant drop or total elimination of dividends
  2. A display of inappropriateness by the company, be it management, or otherwise
  3. An apparent fraud or even outright cooking of accounting books

I’d recently purchased Seagate Technology (STX) in Feb of this year and during that time, things looked to be going in right direction. Although, I was not fully convinced about it but thought that such a marquee company will be able to right the ship with the changes. However, in the technology world, even a year or even few months, can be a light year away. I still think STX has good story going for it, but, looking at the accelerating secular trends of drastic price reduction with each newer version of disks, storage and not to speak of cloud storage, I think it is too much risk to hold STX as a long-term duration security.

As a result of this learning experience, I’d add an additional point in above list: Watch for the secular trends in the area where the company operates. Technology is one field where predicting even for a year is a difficult proposition, probably best left to astrologers or talking heads on TVs.

I sold all my 40 positions of STX on 5/04 at $19.81. Now that, I’ve some ammo to fire for few buys 🙂  That’s what I exactly did: I bought below companies.

1) Bank of Nova Scotia (BNS)

I’d recently bought BNS and this was 5th addition to that. I added 10 positions in BNS on 5/09 at $47.62. It’ll add $28.80 of passive dividend income on an annual basis. BNS got the honor of my first buy of 2016. Bank stocks have nicely recovered and started to appear a bit on the expensive side in my opinion.

2) Eaton Corp, plc  (ETN)

Eaton Corp plc is a power management company providing energy-efficient solutions for electrical, hydraulic and mechanical power. The company operates across 4 segments: electrical systems and services, hydraulics, aerospace and vehicle. The company was founded in 1916 and is headquartered in Dublin, Ireland. ETN has a current market cap of $24B.

ETN has dividend yield of 3.75% and trading at $60.87, dropping from 52 week high of $73.82, about 20% drop. I initiated 5 positions in ETN on 5/09 at $61.11 in my taxable account. It will add $11.40 of passive income annually that I do not need to work for.

3) Welltower, Inc. (HCN)

Real Estate Investment Trusts (REITs) have been pulled down due to concerns about Fed raising interest rates and their impact on the earnings of these REITs, though they started rallying in recently months. The yield of 4.79% is simply juicy.

I bought 5 positions in HCN on 5/13 at $71.74. It’ll add $17.20 of passive income on an annual basis.

Full Disclosure: Long on above mentioned securities.

Thanks for reading.

What do you think about these buy and especially sale?