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Genuine Parts Company Decorates My Dividend Yield Passive Income Portfolio

I bought 20 shares of the American auto parts company Genuine Parts Company (GPC) at $77.06 per share. The total purchase amount was $1,546.25 and represents roughly 1.4% of the full portfolio.

Genuine Parts Company distributes automotive replacement parts, industrial replacement parts, office products, and electrical/electronic materials in the United States, Puerto Rico, the Dominican Republic, Mexico, and Canada. The company distributes automotive replacement parts for imported vehicles, trucks, SUVs, buses, motorcycles, recreational vehicles, farm vehicles, small engines, farm equipment, and heavy duty equipment; and accessory items used in the automotive aftermarket, such as repair shops, service stations, fleet operators, automobile and truck dealers, leasing companies, bus and truck lines, mass merchandisers, farms, industrial concerns, and individuals through 64 NAPA automotive parts distribution centers and 1,100 NAPA AUTO PARTS stores.

The current P/E amounts to 18.61 and the forward P/E is expected at 15.86. Earnings are forecasted to grow at rates of 8.9% for the next year and 8.9% for the next half decade.

Earnings and Dividend Payments of Genuine Parts (GPC)

It’s very interesting and impressive to see how good the industry works for long-term investors. The autoparts wholesale industry is a very small niche and GPC is one of the leading companies. GPC is a Dividend Champion and King combined. It hiked its dividends over 57 consecutive years.

The new stake will give me around $43 in yearly dividends. The total portfolio dividend income is now expected at $1,377.55. I plan to increase this value to $3,000 - $4,000 by the end of this year. All I need to do is to find stocks with a yield on cost of more than 3%. The recent stock buy of GPC could only fulfill this criterion when it hikes one of the next dividend payments by more than 8.3%. It’s still possible because the latest hike was in December 05, 2012.

Dividend Yield Portfolio (click to enlarge)

Lastest Portfolio Transactions (Click to enlarge)

But my problem is still present. Yields go rapidly down because of higher stock prices. If the companies don’t hike their dividends, investors need to accept the new price levels and lower yields from equities.

It'S also possible that we are in a new situation where investors couldn’t expect higher returns from the income of their assets. The current yield-curve goes to zero and the national banks flooding the markets with cheap money. The result is a very low interest level and exploding asset prices.

I’ve no idea how it could end. I don’t think that chaos or a crisis is coming - but when inflation comes and lending rates are more expensive, something will be happen. People will realize that they have paid too high prices for low yielding assets. I could only hope that this will no painful bubble. As of now, it looks still solid and reasonable.

The current portfolio is up 3.16% since the date of funding October 03, 2012. Because of the high cash amount (61.4% is still not invested) and the slow buying process which is part of my strategy, the performance underperforms the market but has also a much lower volatility. 

The stock holdings alone delivered a return of 7.3% or $2,836.60. That's better than the performance of the Dow Jones, Nasdaq and S&P 500.

Portfolio Performance (Click to enlarge)

Here is the income perspective of the portfolio:


Sym
Name
P/E Ratio
Dividend Yield

Buy
# Shrs
Income
Value
TRI
Thomson Reuters C
12.76
4.04

28.90
50
$64.25
$1,589.50
LMT
Lockheed Martin C
11.41
4.51

92.72
20
$86.00
$1,890.60
INTC
Intel Corporation
9.92
4.19

21.27
50
$44.25
$1,047.00
MCD
McDonald's Corpor
18.77
2.92

87.33
15
$44.10
$1,521.30
WU
Western Union Com
8.69
3.07

11.95
100
$45.00
$1,432.00
PM
Philip Morris Int
18.28
3.55

85.42
20
$67.18
$1,854.40
JNJ
Johnson & Johnson
21.35
2.96

69.19
20
$48.80
$1,640.80
MO
Altria Group Inc
17.08
4.92

33.48
40
$69.20
$1,393.60
SYY
Sysco Corporation
18.88
3.2

31.65
40
$44.00
$1,375.20
DRI
Darden Restaurant
15.58
2.94

46.66
30
$45.00
$1,516.20
CA
CA Inc.
12.6
4.04

21.86
50
$50.00
$1,230.00
PG
Procter & Gamble
17.83
2.86

68.72
25
$56.20
$1,955.75
KRFT
Kraft Foods Group
18.85
3.90

44.41
40
$80.00
$2,049.60
MAT
Mattel Inc.
19.49
2.98

36.45
40
$51.60
$1,705.60
PEP
Pepsico Inc. Com
20.27
2.7

70.88
20
$43.00
$1,571.80
KMB
Kimberly-Clark Co
22.28
3.08

86.82
15
$45.45
$1,489.65
COP
ConocoPhillips Co
8.76
4.51

61.06
20
$52.80
$1,170.80
GIS
General Mills In
17.96
2.02

42.13
30
$29.70
$1,462.20
UL
Unilever PLC Comm
21.1
2.98

39.65
35
$43.89
$1,467.20
NSRGY
NESTLE SA REG SHR
20.57
2.88

68.69
30
$63.15
$2,176.80
GE
General Electric
17.86
3.12

23.39
65
$46.80
$1,490.45
ADP
Automatic Data Pr
22.57
2.56

61.65
25
$41.50
$1,594.25
K
Kellogg Company C
23.97
2.73

61.52
25
$43.75
$1,591.00
KO
Coca-Cola Company
20.58
2.58

38.83
40
$41.80
$1,603.20
RTN
Raytheon Company
10.56
3.5

57.04
20
$41.00
$1,163.60
RCI
Rogers Communicat
15.13
3.23

51.06
30
$48.69
$1,501.20
GPC
Genuine Parts Com
18.72
2.61

77.06
20
$40.44
$1,541.20
















$1,377.55
$42,024.90
















Average Yield
3.28%
















Yield On Cost
3.53%