First dividend raises for 2022 (AFL, MRK, BMY, O)

In the last few weeks I received several raises that boost my dividend income! I did not report these in my last "Dividend raises" article because these raises will start having an impact in 2022. So let's see who decided to give me more money and how much!

• On November 15th Aflac (AFL) announced the first quarter dividend of $0,40 per share, payable on March 1, 2022. This represents a monstrous 21,2% increase over the previously declared fourth quarter dividend. This raise will add € 20 to my dividend income!
• On December 4th Merck (MRK) has announced that it will be increasing its dividend to $0,69. This raise is about 6% compared to the previous dividend. Given its current yield of 3,6% this is a decent raise.
• On December 10th Bristol-Myers Squibb (BMY) announced a dividend raise of 10%. Its new quarterly dividend will be $0,54 per share.
• On December15th Realty Income announced an increase in the company's common stock monthly cash dividend to $0.2465 per share from $0.246 per share.

All the raises combined will deliver an annual income boost of almost € 35 in 2022 (and hopefully more after 2022!). That's a solid start of the year, even though the year technically didn't start yet...

 

Dividend raise: Realty Income and Aflac

I totally forgot about these two raises weeks ago but for the sake of full transparancy and completeness of my journey, I'll post 'em.

A few weeks ago Aflac has raised their dividend by a whopping 18%! This is much higher compared to their raises earlier in 2020 and 2019 which were around 4%. Because I added to my position in Aflac earlier this year, this raise will add more than € 13 to my annual dividend income. That's the biggest raise in absolut terms I have ever received from a public company. The new dividend will be paid in Q1 2021 for the first time, so I will count this as a raise in 2021.

More recently, Realty Income Corporation (Realty Income, NYSE: O) announced its Board of Directors has declared an increase in the company's common stock monthly cash dividend to $0.2345 per share from $0.234 per share. This raise adds a whopping € 0,12 to my annual dividend income. Ka-ching!

All jokes aside, Realty Income increases their dividend on more than one occasion each year. Last year they raised the dividend 5 times. I will count this as their first raise in 2021. Hopefully there's more to come next year!

Recent buy: Aflac

Last week I've purchased another batch of shares. After my recent purchase of Shell of a few weeks ago it was time for me to pounce again on the recent pullback due to COVID-19. 

I've added 24 shares of Aflac to my portfolio. Aflac is an existing position in my portfolio. I bought my first shares back in 2014 for a split-adjusted price of around $ 31. The price has been hovering between $50 and $55 before all the market turmoil began. Aflac crashed about 40% so I thought it was time to add a little bit to my existing position.

I now own 80 shares of Aflac. These new 24 shares add roughly €25 to my annual forward dividend income which now stands at €1.892.

What do you think of my purchase? And my reasoning?

Dividend raise: Aflac (+3,7%)

A few days ago Aflac decided to raise its quarterly dividend by $0,01 to $0,28. This is a raise of 3,7% and adds roughly € 2 to my annual dividend income! Ka ching!!

So far Aflac has been a solid perfomer in my dividend portfolio. I bought a block of 56 shares, about 5,5 years ago. Its share adjusted price at that time was $30,70. Currently it's price is around $53. That is a rate of return of 10% per year, without accounting for the dividends. My total return for this position is about 12% without FX-changes.

Its quarterly dividend at the time of my purchase was $0,185. This means that the dividend compounded at roughly 8% each year.

Solid dividend income that grows rather nicely, with a nice rate of return on the share price as well. What more do you want from a stock?

Do you own Aflac? What did you think of its latest dividend raise?

Aflac raised its dividend by 3,8%

A few days ago Aflac decided to raise its quarterly dividend by $0,01 to $0,27. This is a raise of 3,8% and adds roughly € 2 to my annual dividend income! Ka ching!!

So far Aflac has been a solid perfomer in my dividend portfolio. I bought a block of 56 shares, about 4,5 years ago. Its share adjusted price at that time was $30,70. Currently it's price is around $48. That is a rate of return of 10% per year, without accounting for the dividends.

Its quarterly dividend at the time of my purchase was $0,185. This means that the dividend compounded at roughly 9% each year.

Solid dividend income that grows rather nicely, with a nice rate of return on the share price as well. What more do you want from a stock?

Do you own Aflac? What did you think of its latest dividend raise?

10 Reasons why I bought Aflac

I already mentioned earlier that I've opened a position in Aflac. What are my reasons for buying this company? I've got at least 10!

1. Great business model: getting paid up front (premiums), earn investment income from these premiums (float) and deduct incurred losses. It's simple as that and the insurance industry is here to stay for decades to come.
2. Sturdy revenue growth. In last decade Aflac has increased revenue 7% per year (CAGR)
3. Increased profitability. In the same decade, the operating earnings per share grew by 14% per year.
4. Enough oppurtunities for revenue growth in the future, both in Japan and USA.
5. Dividend champion: this company has raised dividends for over 31 consecutive years. In the last decade Aflac raised dividends with on average 15% per year. The dividend growth rate has been slightly lower in the last few years however.
6. Pay-out ratio: Aflac only pays out 21% of its earnings to shareholders. This provides ample safety in the dividend and future increases.
7. Share repurchases: in the last decade Aflac retires between 1-1.5% of their outstanding shares per year.
8. Great balance sheet: debt/equity-ratio of only 0.3. Interest coverage ratio of over 16x.
9. Valuation: with a price/earnings-ratio of 9.5 it is really cheap to purchase shares in such a quality company.
10. Diversification in my DGI portfolio: before this purchase I had no exposure to any insurance company.

To summarize, I've bought 28 shares @ $61.45 per share. This purchase adds around €30 to my annual forward income. As of now my DGI portfolio will earn €675 per year.

What to buy this month?

I've deposited another 1.200 euros to initiate a new position. However, since markets are at all-time highs it's getting harder to find decent valued companies which fit the bill. Right now my watchlist consists of the following stocks: Microsoft, Aflac, Visa and Acomo.