W. W. Grainger

W. W. Grainger’s 46th Consecutive Dividend Increase

Dividend Raises

On April 26th, W. W. “W.W. Grainger, Inc. (NYSE: GWW) announced today that its board of directors voted to raise the quarterly cash dividend by 5 percent to $1.28 per share payable on June 1, 2017, to shareholders of record on May 8, 2017. Grainger has delivered 46 consecutive years of increased dividends.” (invest.grainger.com)

This is a position I have been re-evaluating for quite some time and am thinking of exiting. I am down around 20% due to a very bad reaction to their latest earnings release.

Dividend Income increased 0.04%

Considering the Dividend Beginner portfolio contains 5 shares of W. W. Grainger, Inc., my annual income from GWW has increased by $1.20 USD, from $24.40 USD to $25.60 USD. My 12-month forward dividend income has increased from $2,899.83 to $2,901.03, an increase of 0.04% (this is probably the lowest net dividend income to the portfolio so far). GWW accounts for 0.88% of my annual dividend income. 

While a $1.02 increase in annual dividend income seems quite low, think about how it would require an investment of $45.45, at a yield of 2.64% (GWW’s dividend yield on the day of the raise) to generate $1.20 in dividend income. That’s the equivalent of getting four hours of your life back, at Quebec’s minimum wage of $11.25.

Note: I use a 1:1 ratio when calculating dividend income for $CAD and $USD since it would be too complicated to constantly account for currency difference and it’s constantly changing. The portfolio only generates $120 USD annually with all other income being $CAD.

Before Net Increase After
Annual Dividend Income $2,899.83 $1.20
$2,901.03
Monthly Dividend Income $241.65 $0.10
$241.75
Percentage Increase 0.04%
exchange income corp logo

Exchange Income Corp. Flies to Top Portfolio Position

Purchases

On May 3rd, I added 33 shares of Exchange Income Corp. (TSE: EIF) to The Dividend Beginner’s portfolio.

I purchased the shares at $33.75, with a trading cost of $6.95 for a total investment of $1120.70.

This pushes my total cost basis for my collection of 150 EIF shares to $5,014.95 (includes commissions).

My last purchase was in August 2016, where I purchased 42 shares of EIF.

Originally I had opened this position in May 11 of 2016, with a starting 75 shares of EIF.

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Apple Technology

Apple Announces a 10.5% Dividend Raise

Dividend Raises

On May 2nd, according to Apple’s second quarter results, “The Board has approved a 10.5% increase to the Company’s quarterly dividend, and has declared a dividend of $0.63 per share of the Company’s common stock, payable on May 18, 2017 to shareholders of record as of the close of business on May 15, 2017.” (apple.com)

At the same time, they increased their share repurchase authorization to $210 billion from last year’s $175 billion, as they expand their capital return program to $300 billion.

Since they started the capital program in mid 2012, Apple has spent $151 billion in share repurchases, propping up their earnings per share. I’m a big fan of how much capital Apple returns to their shareholders in share buybacks and dividend increases.

Dividend Income increased 0.20%

Considering the Dividend Beginner portfolio contains 23 shares of Apple Inc., my annual income from AAPL has increased by $5.52 USD, from $52.44 USD to $57.96 USD. My 12-month forward dividend income has increased from $2,825.02 to $2,830.53, an increase of 0.20%. My income from AAPL accounts for 2.05% of my annual dividend income.

While a $5.52 increase in annual dividend income seems quite low, think about how it would require an investment of $324.71, at a yield of 1.7% (AAPL’s dividend yield on the day of the raise) to generate $5.52 in dividend income. That’s the equivalent of getting twenty nine hours of your life back, at Quebec’s minimum wage of $11.25.

Note: I use a 1:1 ratio when calculating dividend income for $CAD and $USD since it would be too complicated to constantly account for currency difference and it’s constantly changing. The portfolio only generates $120 USD annually with all other income being $CAD.

Before Net Increase After
Annual Dividend Income $2,825.02 $5.52 $2,830.53
Monthly Dividend Income $235.42 $0.46
$235.88
Percentage Increase 0.20%
Dividend Income

April 2017 Dividend Income

Dividends

I return to growing my dividend income stream in a larger way this month with investments in very high-yielding stocks. I added $163, or 6% to my annual dividend income. I am getting very close now to an average of $250 per month; then moving on to $300.

April 2015 was the first month I ever received a dividend cheque, to the tune of $25. Two years later, and $262 have made their way into my brokerage account.

I am well on my way to my $3,000 dividend income goal for 2017.

Summary of April Investment Activities

Throughout April, I’ve purchased:

None of my holdings increased their dividend.

None of my holdings were sold to recuperate capital.

None of my holdings reduced their dividends.

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Enbridge Income Fund

Making Enbridge Income Fund My Second Largest Holding

Purchases

On April 19th, I added 49 shares of Enbridge Income Fund Holdings (TSE: ENF) to The Dividend Beginner’s portfolio. I purchased the shares at $33.55, with a trading cost of $6.95 for a total investment of $1,650.90.

This pushes my total cost basis for my collection of 142 ENF shares to $4,661.70 (this figure includes comissions).

I previously bought 43 shares in December 2016.

I had also bought 50 shares in my first purchase of ENF over a year ago, in March 2016.

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Corus Entertainment

Buying Corus Entertainment, Yield of 9%

Purchases

On April 7th, I added 55 shares of Corus Entertainment (TSE: CJR.B) to The Dividend Beginner’s portfolio. I purchased the shares at $12.67, with a trading cost of $6.95 for a total investment of $703.80.

As you may notice this is a very small investment compared to my usual purchases of $1,500-$2,000. This is because I consider CJR.B to be a bit of a risk due to it’s industry of media content and with the rise in cable cutting. Since I already own a position of 105 shares, I just added a small bit to increase the position to a total cost basis of $2,007.50.

Yield on cost lowered to 9.09%

With the latest 55 shares I’ve purchased at a cost basis of $703.80, my yield on cost was 8.9%

In my first purchase of 105 shares for a cost basis of $1,303.70, my yield on cost was 9.18%.

Now with 160 shares, my average cost basis is $2,007.50, or $12.55 per share. With an annual dividend of $1.14, my final yield on cost is still a grand 9.09%.

Consumer Discretionary increased to 6.75%

Portfolio exposure to the consumer discretionary sector has increased from 5.59% to 6.75%.

I have only two positions which contribute to my exposure in this sector, which are Corus Entertainment and Wal-Mart.

Portfolio diversification

Dividend Income increased 2.36%

My new shares in Corus Entertainment adds $62.70 to my annual dividend income, or $5.225 averaged per month.

Previously I earned $119.70 per year due to my 105 shares of CJR.B. This accounted for 4.50% of my overall dividend income.

Combining my new annual dividend income with my previous, I now earn $182.40 per year from CJR.B, accounting for 6.70% of overall dividend income. This averages out to $15.20 per month, up from $9.98.

Before Net Increase After
Annual Dividend Income $2,661.71 $62.70 $2,724.41
Monthly Dividend Income $221.81 $5.225
$227.03
Percentage Increase +2.36%
Dividend Income

March 2017 Dividend Income

Dividends

There remains a lot to be desired of current market valuations, but this month around I enjoyed opening a new position in Richard’s Packaging, to increase the diversity of my portfolio and get back to making larger increases to my dividend income through investments after two purchases in low-yielding Apple stock.

This month also marks breaking through $3,000 in life time dividend income.

March marks a full two years of receiving dividend income from the stock market.

If we look over this period on average, having earned $3,050 in the two years I’ve received dividends has added $127 of cash flow through each of those months.

Going forward, I am now averaging $221 per month. A solid foundation has been set to build off.

Summary of March Investment Activities

Throughout March, I’ve purchased:

One of my holdings increased their dividend.

None of my holdings were sold to recuperate capital.

None of my holdings reduced their dividends.

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Richards Packaging

Added $100 in dividends from Richard’s Packaging

Purchases

On March 15th, I added 80 shares of Richard’s Packaging Income Fund to The Dividend Beginner’s portfolio. I purchased the shares at $26.30, with a trading cost of $6.95 for a total investment of $2,110.95.

Reasons I bought Richard’s Packaging

  • Has a 1-year gain of 30%
  • Has a yield of ~5%
  • Pays a monthly dividend
  • Has increased the dividend for a consecutive 3 years
    • Just increased their dividend by 18% in March
  • Is continuing to make all-time highs
  • Provides exposure to the “Basic Materials” sector, of which I had none
  • 2016 payout ratio was 53% (richardspackaging.com)
    • Note that the distributions were return of capital (so I tax shelter this in my TFSA)
    • Management defines payout ratio as distributions and dividends declared over distributable cash flow

Dividend Income increased 4.13%

My new shares in Richard’s Packaging Income Fund add $105.60 to my annual dividend income, or $8.80 per month. RPI.UN has increased their dividend consecutively for 3 years.

Most recently, at the beginning of March, RPI.UN passed an 18% raise to the monthly distribution, from 9.35¢ to 11¢.

Before Net Increase After
Annual Dividend Income
$2,556.11
$105.60
$2,661.71
Monthly Dividend Income $213.01 $8.80
$221.81
Percentage Increase +4.13%
Canadian Natural Resources

CNQ Comes Through with Another 9% Dividend Raise

Dividend Raises

On March 2nd, “Canadian Natural Resources Limited announces its Board of Directors has declared a quarterly cash dividend on its common shares of C$0.275”. (cnrl.com)

This dividend payment compares to the previous quarter’s C$0.25 (paid in January), where it was also increased 8.7%. The quarterly distribution before that was C$0.23, paid in October 2016.

Canadian Natural Resources effectively increased their dividend by 16.4% in back-to-back dividend increases.

CNQ has increased their dividend for 16 consecutive years and I originally bought this name for it’s impressive dividend growth history – they have not let me down. It is my favourite Canadian stock for exposure to the oil exploration industry.

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Dividend Income

February 2017 Dividend Income

Dividends

As the market continues to offer little value I have not invested as enthusiastically as I did this time around last year, which is around when my investments really started heating up. Everything was dropping at that time so I picked up things that were going on sale. This time around it’s the opposite as share prices have heated up.

I continue to scour in the market and make up my monthly dividend watch lists which is how I find value in this heated market. While the market is expensive, there remain few stocks here and there which offer the value worthy of investment. I continue to tread cautiously, but I still would like to invest monthly and keep up with whichever direction the market is going. I, just like you, have no idea where we’re headed in the near-term.

I doubled my position in Apple last month after their incredible earnings release, and saw three dividend raises to boost income – saving my life hours by having these companies churn out more for me year after year.

Summary of February Investment Activities

Throughout February, I’ve purchased:

One of my holdings increased their dividend.

None of my holdings were sold to recuperate capital.

None of my holdings reduced their dividends.

*We only now realized a distribution increase of $1.32 by HR.UN

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Disclaimer

My publishings on dividendbeginner.com references an opinion and is for information or entertainment purposes only. It is not intended to be investment advice. Seek a duly licensed professional for investment advice. I am not responsible for any decisions you make concerning finances, taxes, or investments. You must perform your own research and always take caution when extending capital.