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.

Here are my recent buys in the month of March 2016.

1) ONEOK, Inc. (OKE)

ONEOK, Inc. is a diversified energy and a partner company of ONEOK Partners, holding 41% interest. It engages in processing, transportation and storage of natural gas liquids (NGL) in United States. The company was founded in 1906 and headquartered in Tulsa, Oklahoma. 

OKE has a juicy dividend yield of 8.58% and a market cap of $6.0B. It ran up to $51.53 at its 52 week high, currently trading at $28.68 and almost 40% lower. This price provides an excellent entry point to investors, though, it could still go lower in short term, however, this price point serves a good base to build on.

I added 25 positions in OKE  on 3/21 at $30.80 in my taxable account. It will add $61.50 of passive income on an annual basis.

2) Royal Dutch Shell plc (RDS.B)

Royal Dutch Shell plc is an independent oil and gas company, incorporated in 2002, and based in United Kingdom. It operates in 3 primary segments: Upstream, Downstream and Corporate. Upstream is engaged in finding crude oil and gas, liquefaction and transportation of gas, Downstream in manufacturing, distribution and marketing activities and Corporate in related support functions like insurance and treasuries.

RDS.B sports a nice dividend yield of 7.72% due to its recent drop. It touched a 52 week high of $65.98 and trading at $48.72. With the acquisition of BG Group, Shell will position itself better to compete against big oil companies. At current valuation, its provides a nice opportunity to investors looking for long-term. However, there are definitely elevated risks due to volatility in oil prices and commodity prices in general.

I added 10 positions in RDS.B on 3/21 at $49.44 in my taxable account. It’ll add $37.60 of passive income on an annual basis. I consider it as a great addition to my Portfolio.

Full Disclosure: Long on above mentioned securities.

Thanks for reading.

What do you think about these buys? 

4 thoughts on “Recent Buy

  1. Still going after that high yield I see. As long as those dividend are covered all will be OK. I like the RDS buy over the OKE and kudos for staying in the oil patch when others are started to flee. Thanks for sharing.

    1. Hi DivHut,

      I love the companies that are at good valuations and nothing better than O&G companies currently. The best of the pack: XOM, CVX and RDS are keeper along with strategic investments in OKE, BBL and KMI. I’d thought that these will go down more but it did not happen, rather rebound happened. So, I end up triggering my buys. Appreciate your perspective.

      Thanks for stopping by and commenting.

  2. I like your OKE stock buy. I own shares of OKE too. I’ve been watching it closely the past few months. The stock is down. Instead of buying shares, I’m selling puts at a $20 strike price. If the stock dips, I get 100 shares for $2,000. If is doesn’t drop, i get to keep the $150 options fee. It’s a win-win.

    1. Hi IH,

      That’s a great idea, right there. I need to look into selling puts and it could be a great strategy if you want to add a company anyways. The only reason I’ve stayed away is due to the unpredictability when I may get to see an option exercised and to keep a larger chunk of cash in hand. By dripping and investing at regular intervals, I’m in charge and with options, market is. Having said that, its great to have a revenue income by selling puts. I’m already little heavy in energy companies as I was averaging down since last year, its a great time to add positions in OKE and others.

      Thanks for stopping by and appreciate the comments.

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