Sunday, August 16, 2015

Monthly Update: July 2015

It's that time of the month again! I am late because I just returned from my holiday. It's a nice feeling to be away for three weeks yet still get paid a few bucks for owning shares in some wonderful companies.

After the big losses in my portfolio last month, this month showed some black numbers again. In the table below I have presented some benchmark indicators of general market indices and my own dividend growth portfolio.


July 2015
IndicatorAs of 30-6As of 31-7% change
S&P 500 Total Return3.8163.896+2,1%
Dow Jones Industrials Total Return35.66235.848+0,5%
AEX GR1.4031.472+4,9%
USD.EUR0,90320,9082+0,6%
Portfolio value€ 23.631 € 24.074 +1,9%

However, since I am in it for the long haul I am not too interested in these daily or monthly fluctuations. What matters is that I keep focused on buying high quality companies which provide me with a steady stream of growing dividends.

Saturday, July 11, 2015

Omega Healthcare Investors: A Healthcare REIT That Under Promised And Over Delivered In The Last Decade

When I wrote my monthly update last Wednesday and had to write about my Seeking Alpha goal (writing 24 articles this year) I was actually feeling a little bit miserable about myself. I already had some valuation analysis done for Omega Healthcare Investors (OHI) and decided to put it in an article.

I have been a shareholder of Omega Healthcare Investors since December 2013. Back then I opened a position for roughly $30 a share. I was attracted by the consistent revenue growth in the past few years, high dividend growth rate and yield. This purchase has become one of my better buys in the past years with an annualized rate of return of almost 18%. I am contemplating adding to my position, but does that make sense when the stock has performed so wonderful the last 1.5 years? It must be overvalued, right? However there are some great companies like Johnson & Johnson, Colgate and Disney that constantly seem overvalued but still have the ability to provide great rate of returns for a shareholder. I am not comparing Omega to these companies in any meaningful way but still would like to investigate whether the current valuation merits a buy or not.

You can read the rest of the article here:

http://seekingalpha.com/article/3315655-omega-healthcare-investors-a-healthcare-reit-that-under-promised-and-over-delivered-in-the-last-decade

Wednesday, July 8, 2015

Monthly Update: June 2015

It's that time of the month again! A few days late but here's my monthly update for June. Markets lost a lot of ground, especially the Dutch AEX. But my portfolio definitely took a tumble this month. Down over 5%, with special attention to INTC (-11%), KMI (-8%) and TGH (-7%). In the table below I have presented some benchmark indicators of general market indices and my own dividend growth portfolio.


IndicatorAs of 30-5As of 30-6% change
S&P 500 Total Return3.8913.816-1,9%
Dow Jones Industrials Total Return36.47335.662-2,2%
AEX GR1.4611.403-4,0%
USD.EUR0,90200,90320,1%
Portfolio value€ 24.890 € 23.631 -5,1%

However, since I am in it for the long haul I am not too interested in these daily or monthly fluctuations. What matters is that I keep focused on buying high quality companies which provide me with a steady stream of growing dividends. Too bad I don't have any capital available right now to pounce on some of the value the market is currently offering.


Sunday, June 7, 2015

Monthly Update: May 2015

It's that time of the month again! A few days late but here's my monthly update for May. In general markets rose with gains between 1 and 2%. The USD.EUR-rate also increased 1% which helps my portfolio since around 80% is USD-listed. In the table below I have presented some benchmark indicators of general market indices and my own dividend growth portfolio.


May 2015
IndicatorAs of 30-4As of 30-5% change
S&P 500 Total Return3.8423.891+1.3%
Dow Jones Industrials Total Return35.92736.473+1.5%
AEX GR1.4371.461+1.6%
USD.EUR0.89290.9020+1.0%
Portfolio value€ 24.833 € 24.890 +0.2%

However, since I am in it for the long haul I am not too interested in these daily or monthly fluctuations. What matters is that I keep focused on buying high quality companies which provide me with a steady stream of growing dividends.


Sunday, May 10, 2015

Monthly Update: April 2015

It's that time of the month again! A few days late but here's my monthly update for April. In general markets rose slightly with gains between 0.3 and 1%. On a daily basis the fluctuations were much higher but in the end the results are average I guess. However the US dollar lost grounds against the Euro which had its effect on my portfolio. Roughly 80% of my portfolio is valued in USD. In the table below I have presented some benchmark indicators of general market indices and my own dividend growth portfolio.


april 2015
IndicatorAs of 31-3As of 30-4% change
S&P 500 Total Return3.8053.842+1,0%
Dow Jones Industrials Total Return35.76735.927+0,4%
AEX GR1.4331.437+0,3%
USD.EUR0,91070,8929-2,0%
Portfolio value€ 25.407 € 24.833 -2,3%

Tuesday, May 5, 2015

Recent buy: Union Pacific Corp

Last week I wrote a post about the question in which company to invest next. I got several good tips, thanks! In the end I went back and forth between Johnson & Johnson (JNJ) and Union Pacific Corp (UNP). So what's my reasoning with this purchase?

  • I was not invested in any railroad company so far while I do have some healthcare exposure through BAX and to a lesser extent OHI.
  • The railroad industry has high barriers of entry and consequently a big moat. Railroads and trains have various competitive advantages over trucks (e.g. cost, speed, safety, environment) and will remain an important part of the future transport sector.
  • Current yield of UNP (2%) is lower than JNJ's yield (3%), however UNP's dividend growth in recent years outpaced JNJ's growth rate.
  • UNP's payout ratio (in terms of %EPS) is only 37% which leaves ample room for future dividend growth, especially with estimated EPS growth of ~14% in the next 5 years (analysts opinions...).
  • JNJ's payout ratio is slightly higher at 54% and estimated EPS growth rate is also lower at ~5% for the next 5 years.
  • The P/E-ratio is comparable (~18x)
  • Obviously JNJ's balance sheet is a fortress, but UNP's debt/equity ratio of 0.6 is not too bad either.
  • Total return in the last 10 years for UNP is a whopping 22% per year. Even half of that would be just fine by me! JNJ's total return in the last 10 years is only 6% per year. This gap is much smaller if you take into account the risk adjusted rate of return (JNJ is a much 'safer' investment in terms of beta). But still UNP is much more of a growth company than JNJ.
All in all I decided to open a position in Union Pacific Corp. My purchase of 15 shares add roughly 30 to my annual forward dividend income.


Monday, April 27, 2015

Next purchase: what to do?

I just deposited €1000,- to my brokerage account. Together with the accumulated dividends of the last months (€500) I am able to open up another position in my dividend growth portfolio. Given the fact that the US dollar and the Euro are looking at parity maybe somewhere in the next few months, I was pondering to purchase a Euro-based dividend company. However the 'Euro Dividend All Stars' (maintained by No More Waffles) provided me with less options than I originally anticipated!

I used the following criteria in my search:

  • P/E-ratio < 20;
  • 3-, 5- and 10 DGR > 6%;
  • Yield > 1.5%;
This set of criteria yielded me with 6 investment options. All of those are hovering near their 52wk highs. I only recognized BASF (materials) and BMW (auto industry). However I am not keen on getting into the auto industry. So maybe BASF? Unfortunately they only pay their dividends once per year :(

So what about US dividend stocks? There seems to be some consensus that certain stocks are good buys in the current market environment. I've seen a few 'recent buy' posts about JNJ, T and TROW. However, Praxair (PX) is looking nice at $122 as well (P/E-ratio at 21x though). Blackrock's (BLK) stock price has run up slightly since the beginning of the year, so perhaps TROW is a slightly better option right now? Realty Income (O) decreased almost 10% in the last 3 months and is a monthly dividend payer. Definitely O would be a nice quality addition to my portfolio!

Does someone out there have some good advice for me? Or maybe some other suggestions? I am looking forward to hearing from you :)