Thursday, June 16, 2016

Yet more changes to my DSP/loyal3 investment plan

I hate to change things so often, but yesterday I received notification that South Jersey Industries (SJI) is no longer offering a discount on dividend reinvestment. With that, SJI has lost all its luster, so I deleted it from my plan. Further, I added HCN to my plan at $150/month. HCN offers a generous 5% discount on optional cash investment and 2% on dividend reinvestment. Compare this to only 1% discount offered by NNN for dividend reinvestment only. Hence, my revised plan is as below:

TickerRatingDGIDiscount?Shiller P/EYieldMonthly InvestSectorSector TotalSector Percent
NVSA1DN15.883.59%$200.00Healthcare
$400.00
11.43%
SNYA2DN19.434.42%$100.00Healthcare
BDXB+2AN31.471.59%$100.00Healthcare
KOA+1AN25.153.13%$200.00Staples
$700.00
20.00%
WMTA1AN15.902.82%$200.00Staples
BUDA+2CN24.613.28%$100.00Staples
PEPA1AN25.612.93%$100.00Staples
ULA1DN22.363.31%$100.00Staples
XOMB+1AN12.063.36%$200.00Energy$200.005.71%
BRK.BA+2DN22.520.00%$200.00Financial
$650.00
18.57%
AFLB3AN13.492.43%$200.00Financial
HCNB2BY48.214.72%$150.00Financial
NNNDAY31.253.65%$100.00Financial
INTCA2DN17.263.32%$100.00Tech
$300.00
8.57%
MSFTA2BN22.922.90%$100.00Tech
MOCODDN22.363.08%$100.00Tech
EMRA2AN16.803.71%$200.00Industrial
$500.00
14.29%
NSCA2BN16.532.85%$150.00Industrial
VMIDBN21.291.14%$150.00Industrial
EXCB2DN10.663.72%$100.00Utility
$200.00
5.71%
YORWDBY39.342.06%$100.00Utility
VFCA+2AN30.742.40%$150.00Discretionary
$450.00
12.86%
NKEA+2BN41.451.21%$150.00Discretionary
MCDA2AN26.192.93%$150.00Discretionary
SONC2AN22.123.16%$100.00Material$100.002.86%
Total21.672.81%$3,500.00$3,500.00100.00%
Rating$%DGI$%
A$2,20063%A$1,70049%
B$75021%B$80023%
C$1003%C$1003%
D$45013%D$90026%
Total$3,500100%$3,500100%
Rating is based on Morningstar as follows:
A=Wide Moat; B=Narrow Moat; C=No Moat; D=Not rated by Morningstar
+=Exemplary; [blank]=Standard; -=Poor stewardship
1=Low; 2=Medium; 3=High; 4=Very High uncertainty
DGI (Dividend Growth investing) as follows:
A=25+ years of higher dividends;
B=10-24 years of higher dividends;
C=5-9 years of higher dividends;
D= less than 5 years of higher dividends.

Overall investment level remains at $3,500/month. Rating also improved somewhat, as D-rated SJI is replaced by B-rated HCN. No change is made to DGI since both stocks are dividend contenders (B). This change, however, increased both Shiller P/E and dividend yield. The increase is mild, however. The discount is a much more important consideration.

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