With the holidays quickly approaching, there has been a lot of red in the market the last week or so and I’ve been patiently watching a handful of stocks from my latest dividend watch list.
Late last week I missed an opportunity to add to a couple of holdings as I was away from the computer spending a day with Divvy Mom doing some Christmas shopping and enjoying some time together–which is worth far more than any discount on a stock purchase.
Fortunately, by remaining patient I was presented with buying opportunities again today.
Adding to BlackRock and Altria Group
Given that I just recently purchased BlackRock stock and added to my Altria position back in August, I won’t rehash the typical background on each stock or dig into the numbers.
For more analysis on each company, I encourage you to review the prior posts detailing each purchase.
Here is a snapshot of my two purchases:
BlackRock is still a fairly new position to my portfolio and as I mentioned when sharing my watch list, I was looking to add more if the price returned to the sub-$400/share levels after previously purchasing at $396/share.
My sights were set on a price approximately 3-5% below my original purchase, and today I was able to buy an additional 5 shares at a cost of $383.00/share for a 3.27% dividend yield.
The 5 shares will add an additional $62.60 in projected annual dividend income.
This purchase doubles my share count to 10 shares, reduces my cost basis to $389.50, and will produce $125.20 in PADI.
Altria Group was already one of my larger holdings on a weighted basis; however, with the price testing the 52-week low and their recent move into the cannabis market I opted to round out my holding to 100 shares. Last week Altria announced a $1.8B investment into Cronos that will give them a 45% stake in the Canadian cannabis company. They also hold warrants that, if exercised, would increase their stake to 55% of the company.
In addition, there is speculation that Altria is looking to buy a stake in Juul, one of the most popular e-cigarette companies in the industry. With both of these companies, I believe Altria is positioning themselves well for the future.
The investment in Cronos and possible investment in Juul actually can go hand-in-hand as well, as it is possible to use the Juul (currently requires the user to hack the device but that may change in the future) to vape THC. Therefore the combination of these two companies could be a strategic move for Altria in the Canadian market, and eventually the US market should cannabis become legal nation-wide.
With the price of Altria dropping in recent weeks, I decided to take advantage and added 33 shares @ $53.00/share for a whopping 6.04% dividend yield.
The 33 shares will add an additional $105.60 in projected annual dividend income.
As mentioned, I now have a total of 100.275 shares that produce a total of $320.88 in PADI.
With these two purchases, both Altria and BlackRock are now slightly overweight in my DGI portfolio at 4.4% and 3.3% respectively. Therefore I am most likely done adding to both of these positions for some time, and will only be tempted if we see significant declines in either.
While these two holdings are overweight in my dividend growth investing portion of my portfolio, they each still represent less than 1% of my overall portfolio–so there is room to add more, but I want to build my DGI portfolio in as balanced manner as possible.
These two purchases, along with the dividends received thus far in December, have pushed me extremely close to reaching my revised goal of obtaining $5,500 in projected annual dividend income.
As of today, these purchases have added $168.20 in projected annual dividend income and that has pushed me to $5,468.10 in PADI. With the intent to make at least one or two more purchases before the month ends, I am confident that I will reach my revised goal.
What do you think of these two purchases?
Have you added either recently?
8 thoughts on “Recent Buy :: BlackRock & Altria Group”
Outstanding purchases, DivvyDad. I own both and view both as long-term holdings. You exhibited some nice patience and secured some terrific prices. Congrats on these recent purchases and putting yourself in a great position to achieve your revised PADI goal.
You’ve been impressively building out your portfolio, and I’m excited to see where you can take it in 2019.
Thanks ED, I really like both of these companies and also view them as long-term holdings so am really happy to be able to add shares at these price levels. The portfolio is taking shape and I too am looking forward to next year and having a full year under my belt with the DGI strategy.
I own and like both at current valuation. MO is a high-yielder with fantastic dividend growth. Hard to find sth. comparable. BLK will benefit from the trend towards passive managed products. In general, I feel that the financial sector looks appealing at current prices.
Agreed, and that grasp that BLK has on the passive index funds, particularly with their iShares line of ETFs, is what initially drove me to invest in them versus adding to my position in Franklin Resources. Here is to them both being great long-term holdings!
I own MO, but I don’t yet own BLK. Interestingly enough, I will soon be adding to MO because great minds think alike I guess. A company that has a near 6% dividend yield and grows its dividend by mid to high single digits is a company that I can’t pass up. The recent investment in Cronos Group and rumors of a possible joint venture between Altria and Philip Morris to purchase a stake in Juul only adds to my interest.
Yep, I couldn’t resist this price point and took the opportunity to round out my position in MO. I like the move with Cronos, and that they moved off Aphria who was initially speculated (I’m not sure if there is validity to the allegations against them but best to steer clear at this point IMO).
Taking a stake in Juul would be the next step and hopefully they can do that; seems the joint approach with PM would be to reduce taking on debt to do the deal.
I did some tax loss harvesting a few days ago with one of my losers, CMP. I reallocated across several of my holdings, one being MO. The yield and dividend growth are very appealing, but I don’t want to over do it since even with the recent weakness it remains my largest single holding. Tom
Thanks for sharing Tom; like you, I wanted to be somewhat cautious as MO is one of my top holdings right now.
I am also looking at some tax loss harvesting opportunities right now to evaluate if I want to make any moves there before the end of the year, but with most dividends reinvested I need to make sure I wouldn’t introduce any wash sale situations.