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Software Giant Microsoft Is The New Stock Buy For My Passive Income Portfolio

Past Friday, I purchased shares of the software giant Microsoft. The company has a P/E of 13.08 which should fall to a ratio of 11.32 by next year. Earnings growth of 8.7 percent for the next five years is forecasted by analysts.

Microsoft announced recently to raise their future dividends by 22 percent and buy back $40 billion in own shares. This should drive trading volume into the stock. The expected dividend yield is 3.31 percent.

I believe that the microsoft stock has still potential to grow dividends in the future. Despite the weakness with the implementation of new technologies, Microsoft is still a growth stock. Sales more than doubled within the past decade and earnings increased by a factor of 2.5x. That's pretty good for the company with $77 billion cash and $12.6 billion long-term debt.

However, I put 40 shares at $33.88 into the Dividend Yield Passive Income Portfolio. The total purchase amount resulted in $1,360 which should bring additional $45 in yearly dividends.


Latest Portfolio Transactions (Click to enlarge)

Portfolio Overview I (Click to enlarge)

Portfolio Overview I (Click to enlarge)

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For readers who are new to the matter and my dividend growth philosophy: I funded a virtual portfolio with 100k on October 04, 2012 with the aim to build a passive income stream that doubles each five to ten years. I plan to purchase each week one stock holding until the money is fully invested. The total number of constituents is expected at 50 – 70 companies and the dividend income should be at least at $3,000 per year.
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Over the full year, the expected dividend income amounts to $2,485. With around $27,400 in deposited cash, it’s still possible to reach the $3,000 by the end of this year.


Portfolio Performance (Click to enlarge)

The full portfolio holdings are up 6.23 percent in average. Due to the high cash amount and slow buying process in a gaining market, the complete portfolio performance is only 5.85 percent.

Here is the income perspective of the portfolio


Sym
Name
P/E Ratio
Dividend Yield
Buy
# Shrs
Income
Value
TRI
Thomson Reuters C
26.32
3.75
28.90
50
$64.75
$1,725.50
LMT
Lockheed Martin C
13.78
3.75
92.72
20
$92.00
$2,450.00
INTC
Intel Corporation
12.21
3.98
21.27
50
$45.00
$1,140.50
MCD
McDonald's Corpor
17.33
3.25
87.33
15
$46.20
$1,420.50
WU
Western Union Com
11.77
2.68
11.95
100
$50.00
$1,878.00
PM
Philip Morris Int
17
4.03
85.42
20
$70.58
$1,740.80
JNJ
Johnson & Johnson
19.22
2.93
69.19
20
$50.80
$1,746.20
MO
Altria Group Inc
15.86
5.19
33.48
40
$72.00
$1,386.00
SYY
Sysco Corporation
18.9
3.55
31.65
40
$44.80
$1,268.80
DRI
Darden Restaurant
16.32
3.37
46.66
30
$46.50
$1,401.60
CA
CA Inc.
12.77
3.42
21.86
50
$50.00
$1,478.50
PG
Procter & Gamble
19.65
3.07
68.72
25
$58.20
$1,900.50
KRFT
Kraft Foods Group
17.17
3.76
44.41
40
$80.00
$2,128.80
MAT
Mattel Inc.
18.93
3.3
36.45
40
$55.60
$1,702.00
PEP
Pepsico Inc. Com
18.71
2.78
70.88
20
$44.20
$1,592.40
KMB
Kimberly-Clark Co
20.08
3.36
86.82
15
$47.55
$1,413.90
COP
ConocoPhillips Co
11.7
3.81
61.06
20
$52.80
$1,419.40
GIS
General Mills In
17.85
2.18
42.13
30
$31.20
$1,438.50
UL
Unilever PLC Comm
18.06
3.5
39.65
35
$47.01
$1,334.55
NSRGY
NESTLE SA REG SHR
19.1
3.15
68.69
30
$65.31
$2,058.00
GE
General Electric
17.84
3.15
23.39
65
$49.40
$1,563.25
ADP
Automatic Data Pr
24.64
2.45
61.65
25
$43.50
$1,788.00
K
Kellogg Company C
22.56
3.02
61.52
25
$44.50
$1,484.00
KO
Coca-Cola Company
19.57
2.95
38.83
40
$43.80
$1,488.00
RTN
Raytheon Company
12.94
2.87
57.04
20
$43.00
$1,485.00
RCI
Rogers Communicat
11.39
3.97
46.5
50
$84.00
$2,150.00
GPC
Genuine Parts Com
17.87
2.65
77.06
20
$42.12
$1,613.00
TSCDY
TESCO PLC SPONS A
N/A
3.87
17.08
110
$75.68
$1,931.60
APD
Air Products and
22.5
2.63
85.71
15
$41.55
$1,594.65
GSK
GlaxoSmithKline P
19.35
4.66
52.16
30
$71.13
$1,503.30
WMT
Wal-Mart Stores
14.24
2.47
79.25
20
$36.16
$1,456.00
BTI
British American
15.78
4.05
111.13
23
$96.14
$2,363.71
CHL
China Mobile Limi
10.81
4.06
55.32
25
$55.95
$1,373.75
MMM
3M Company Common
18.56
2.1
110.27
15
$37.43
$1,791.00
TUP
Tupperware Brands
18.61
2.56
80.98
15
$33.30
$1,313.40
IBM
International Bus
13.05
1.96
197.09
16
$57.60
$2,945.60
HAS
Hasbro Inc.
18.99
3.24
44.09
30
$45.60
$1,422.90
T
AT&T Inc.
25.76
4.01
34.47
30
$40.50
$1,012.50
WAG
Walgreen Co. Comm
21.86
2.04
44.25
30
$34.20
$1,673.70
AFL
AFLAC Incorporate
8.74
2.23
59.39
20
$28.00
$1,274.60
TGT
Target Corporatio
15.29
2.38
68.69
32
$48.32
$2,029.12
CSCO
Cisco Systems In
12.37
2.83
25.12
90
$58.50
$2,071.80
DE
Deere & Company C
9.42
2.42
84.11
15
$29.85
$1,238.25
RGR
Sturm Ruger & Co
13.77
2.96
51.65
20
$38.52
$1,301.40
LO
Lorillard Inc Co
14.17
4.77
42.3
30
$65.00
$1,347.90
UNP
Union Pacific Cor
17.69
1.84
154.75
8
$22.88
$1,231.20
IDA
IDACORP Inc. Com
12.83
3.17
47.94
20
$30.40
$962.80
BAX
Baxter Internatio
16.08
2.92
66.38
20
$37.60
$1,300.20
MSFT
Microsoft Corpora
13.12
2.72
33.88
40
$36.80
$1,355.20














$2,485.92
$78,690.28














Average Yield
3.16%














Yield On Cost
3.37%

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