I’m
continuing my strategy to buy higher yielding stocks from the telecom sector: On the latest trading day, I purchased 30 shares of the second biggest telecom
carrier in the United States, Verizon. The company yields at 4.21 percent, a value that is smaller than the figure of the bigger rival AT&T which is also part of my
portfolio.
Verizon is a cheap dividend growth stock and has a forward P/E of 14.44.
Verizon is a cheap dividend growth stock and has a forward P/E of 14.44.
I believe
that telecoms in America are strong cash flow producing stocks and I think that they can deliver good cash quotes for my Dividend Yield Passive Income
Portfolio over the long-run.
The total
buying amount was around $1,500 bucks at a price of $50.31. For sure, investment
costs are very high for telecoms and the ability to hike consumer prices is very limited due to strong regulations from the government.
But the two biggest companies, Verizon and AT&T, can generate each up to $20 billion in free cash per year. That’s a huge number in a nation with a slow growing population.
But the two biggest companies, Verizon and AT&T, can generate each up to $20 billion in free cash per year. That’s a huge number in a nation with a slow growing population.
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| Latest Portfolio Transactions (Click to enlarge) |
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| Latest Portfolio I (Click to enlarge) |
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| Latest Portfolio II (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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With the
latest dividend stock purchase of Verizon, the expected dividend income rises
to $2,766 bucks per year. The current yield on cost is at 3.4 percent while the
actual portfolio yield is still over 3 percent at 3.04 percent.
The
portfolio generated around $9,600 in capital gains on a $100,000 investment and
additional $1,600 bucks were received in dividends.
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| Latest Portfolio Performance (Click to enlarge) |
The power
of compounding dividends is a long-term play and should boost the whole
portfolio value into new dimensions over the upcoming years. Let us watch how
my strategy develops over the time.
As of now,
the current portfolio is underperforming the major indices due to the slow
purchase process and high cash values over the past year. But nobody could
expect that the financial market starting to boom. In an underperforming
market, my strategy would have beaten the market.
But I don’t
look at short-term aims and quick returns. My focus is to create a
well-diversified asset structure that delivers a solid cash-income that doubles
each ten years or so.
Here is the income perspective of the portfolio
Sym
|
Name
|
P/E Ratio
|
Dividend Yield
|
Buy
|
# Shrs
|
Income
|
Value
|
TRI
|
34.77
|
3.36
|
28.90
|
50
|
$64.75
|
$1,917.50
|
|
LMT
|
Lockheed Martin C
|
14.76
|
3.33
|
92.72
|
20
|
$92.00
|
$2,749.00
|
INTC
|
Intel Corporation
|
13.19
|
3.69
|
21.27
|
50
|
$45.00
|
$1,226.00
|
MCD
|
McDonald's Corpor
|
17.61
|
3.16
|
87.33
|
25
|
$77.00
|
$2,423.00
|
WU
|
Western Union Com
|
11.56
|
2.87
|
11.95
|
100
|
$50.00
|
$1,670.00
|
PM
|
Philip Morris Int
|
17.22
|
3.89
|
89.76
|
30
|
$105.87
|
$2,740.80
|
JNJ
|
Johnson & Johnson
|
20.95
|
2.7
|
69.19
|
20
|
$50.80
|
$1,887.80
|
MO
|
Altria Group Inc
|
14.71
|
4.77
|
33.48
|
40
|
$72.00
|
$1,520.00
|
SYY
|
Sysco Corporation
|
20.1
|
3.34
|
31.65
|
40
|
$44.80
|
$1,348.00
|
DRI
|
Darden Restaurant
|
18.71
|
3.99
|
46.66
|
30
|
$63.00
|
$1,605.00
|
CA
|
CA Inc.
|
13.96
|
2.29
|
21.86
|
50
|
$37.50
|
$1,642.50
|
PG
|
Procter & Gamble
|
21.43
|
2.81
|
68.72
|
25
|
$59.20
|
$2,121.00
|
KRFT
|
Kraft Foods Group
|
17.13
|
3.82
|
44.41
|
40
|
$80.00
|
$2,122.00
|
MAT
|
Mattel Inc.
|
19.18
|
3.03
|
36.45
|
40
|
$55.60
|
$1,847.20
|
PEP
|
Pepsico Inc. Com
|
20.28
|
2.56
|
70.88
|
20
|
$44.20
|
$1,720.60
|
KMB
|
Kimberly-Clark Co
|
22.81
|
2.89
|
86.82
|
15
|
$47.55
|
$1,638.90
|
COP
|
ConocoPhillips Co
|
11.27
|
3.66
|
61.06
|
20
|
$52.80
|
$1,466.00
|
GIS
|
General Mills In
|
19.31
|
2.76
|
42.13
|
30
|
$42.60
|
$1,539.30
|
UL
|
Unilever PLC Comm
|
18.77
|
3.5
|
39.65
|
35
|
$48.83
|
$1,399.30
|
NSRGY
|
NESTLE SA REG SHR
|
20.19
|
2.98
|
68.69
|
30
|
$65.31
|
$2,192.55
|
GE
|
General Electric
|
20.29
|
2.82
|
23.39
|
65
|
$49.40
|
$1,768.00
|
ADP
|
Automatic Data Pr
|
26.18
|
2.26
|
61.65
|
25
|
$43.50
|
$1,933.25
|
K
|
Kellogg Company C
|
24.21
|
2.81
|
61.52
|
25
|
$44.50
|
$1,565.25
|
KO
|
Coca-Cola Company
|
20.84
|
2.72
|
38.83
|
40
|
$43.80
|
$1,608.80
|
RTN
|
Raytheon Company
|
14.76
|
2.51
|
57.04
|
20
|
$43.00
|
$1,705.60
|
RCI
|
Rogers Communicat
|
12.12
|
3.76
|
46.5
|
50
|
$84.00
|
$2,242.00
|
GPC
|
Genuine Parts Com
|
18.53
|
2.55
|
77.06
|
20
|
$42.12
|
$1,655.00
|
TSCDY
|
TESCO PLC SPONS A
|
N/A
|
4
|
17.08
|
110
|
$75.79
|
$1,894.75
|
APD
|
Air Products and
|
23.21
|
2.55
|
85.71
|
15
|
$41.55
|
$1,658.85
|
GSK
|
GlaxoSmithKline P
|
20.56
|
4.62
|
52.16
|
30
|
$72.24
|
$1,562.40
|
WMT
|
Wal-Mart Stores
|
15.39
|
2.29
|
79.25
|
20
|
$36.16
|
$1,584.40
|
BTI
|
British American
|
16.64
|
3.84
|
111.13
|
23
|
$96.14
|
$2,515.51
|
CHL
|
China Mobile Limi
|
10.19
|
4.3
|
55.32
|
40
|
$89.52
|
$2,139.20
|
MMM
|
3M Company Common
|
19.94
|
1.92
|
110.27
|
15
|
$37.43
|
$1,947.75
|
TUP
|
Tupperware Brands
|
18.95
|
2.45
|
80.98
|
15
|
$33.30
|
$1,358.55
|
IBM
|
International Bus
|
12.62
|
2.03
|
193.17
|
20
|
$74.00
|
$3,663.80
|
HAS
|
Hasbro Inc.
|
24.18
|
2.96
|
44.09
|
30
|
$46.80
|
$1,581.90
|
T
|
AT&T Inc.
|
25.74
|
5.12
|
34.47
|
30
|
$54.00
|
$1,062.90
|
WAG
|
Walgreen Co. Comm
|
23.48
|
1.96
|
44.25
|
30
|
$35.40
|
$1,808.40
|
AFL
|
AFLAC Incorporate
|
10.3
|
1.56
|
59.39
|
20
|
$21.00
|
$1,349.60
|
TGT
|
Target Corporatio
|
16.07
|
2.26
|
68.69
|
32
|
$48.32
|
$2,140.48
|
CSCO
|
Cisco Systems In
|
11.49
|
3.04
|
25.12
|
90
|
$58.50
|
$1,938.15
|
DE
|
Deere & Company C
|
9.51
|
2.4
|
84.11
|
15
|
$29.85
|
$1,242.45
|
RGR
|
Sturm Ruger & Co
|
14.02
|
2.87
|
51.65
|
20
|
$42.48
|
$1,485.00
|
LO
|
Lorillard Inc Co
|
16.46
|
4.14
|
42.3
|
30
|
$65.00
|
$1,579.50
|
UNP
|
Union Pacific Cor
|
17.45
|
1.81
|
154.75
|
8
|
$22.88
|
$1,275.92
|
IDA
|
IDACORP Inc. Com
|
15.25
|
3.09
|
47.94
|
20
|
$31.40
|
$1,017.60
|
BAX
|
Baxter Internatio
|
17.12
|
2.78
|
66.38
|
20
|
$37.60
|
$1,373.20
|
MSFT
|
Microsoft Corpora
|
14.23
|
1.81
|
33.88
|
40
|
$27.60
|
$1,513.64
|
ACN
|
Accenture plc. Cl
|
15.62
|
2.26
|
77.71
|
20
|
$34.80
|
$1,560.40
|
BCE
|
BCE Inc. Common
|
14.56
|
3.88
|
44.26
|
25
|
$42.98
|
$1,118.75
|
VZ
|
Verizon Communica
|
65.46
|
4.13
|
50.31
|
30
|
$62.25
|
$1,509.30
|
$2,766.11
|
$91,136.75
|
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Average Yield
|
3.04%
|
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Yield On Cost
|
3.40%
|