I can’t believe it!  Half of 2013 is already past us.  Things have been going pretty well the first half of this year.  The market has been going up and up.  I’ve been doing a good job consistently adding more capital to my portfolio to buy more dividend growth stocks.  I’m well on my way towards reaching my 2013 goals.

2013 Goal Progress

My main goal for 2013 was to contribute an additional $8,000 towards my dividend growth investing portfolio.  I’m pleased to announce that I am slightly ahead of schedule half way through the year.  So far I have contributed $4,336 towards my dividend growth portfolio this year.

Portfolio Review

As of June 30, 2013, I have 15 companies in my dividend growth portfolio.  Eventually my goal is to own around 35 dividend growth stocks.  I believe this will be a good amount of companies to own for diversification purposes, protecting my income stream should any company falter.

Below you can see a table of my current portfolio:

Dividend Growth Portfolio
Ticker Name % Portfolio Dividend Yield Yield on Cost
AFL Aflac 15.71% 2.47% 2.88%
WAG Walgreen's 13.70% 2.51% 3.34%
DE Deere & Co 8.40% 2.53% 2.53%
COP ConocoPhillips 7.64% 4.28% 4.67%
WMT Wal-Mart 6.64% 2.53% 3.48%
MCD McDonald's 6.41% 3.10% 4.03%
HAS Hasbro 6.16% 3.48% 4.54%
NSC Norfolk Southern 5.69% 2.79% 3.23%
MSFT Microsoft 5.52% 2.73% 2.97%
HRS Harris Corp 4.88% 3.01% 3.85%
LO Lorillard 4.80% 5.00% 5.14%
WFC Wells Fargo 3.72% 2.88% 3.02%
RAI Reynolds American 3.61% 5.20% 7.61%
KO Coca Cola 3.60% 2.78% 3.26%
GE General Electric 3.54% 3.30% 4.84%

As you can see I have a pretty good mix of different kinds of companies.  There are retail, financial, oil, tobacco, toys, restaurants, beverages, technology and others.

My largest holdings are Aflac and Walgreen’s.  My smallest positions are in Coca Cola and General Electric.  This isn’t by design.  This is because I make purchases in companies that I believe to be the best value at the time which has given me an uneven balance in my portfolio. 

I am OK with this as long as one weighting doesn’t become too heavy.  As I build my portfolio up to about 35 companies, I will prefer to keep any one companies weighting below 5%.

So far this year, I have made 5 new purchases in my portfolio.  I added to my positions in Aflac, ConocoPhillips and Deere & Co.  I have started up new positions in Lorillard and Wells Fargo.

Through the first 6 months of 2013, my portfolio has paid me a dividend income of $256.90.  My total return for the portfolio has been 13.75%.

As for dividend growth:

  • Deere & Co. has increased their dividend by 10.87%.
  • General Electric has increased their dividend by 11.76%.
  • Hasbro has increased their dividend by 11.11%.
  • Coca Cola has increased their dividend by 9.80%.
  • Wal-Mart has increased their dividend by 18.24%.

I am very pleased with the increases these companies have made to their dividends this year.  I will look for the other companies in my portfolio to grow their dividend rates sometime in the second half of the year.  Remember my main criteria for investment is annual increases in the dividend.

Conclusion

Overall I’m pretty pleased with the performance of my portfolio so far this year.  I’m surprised to notice that I have only bought 2 completely new companies to my portfolio and I will probably look to initiating positions in more new companies the second half of 2013.  Most likely I will look to increasing the amount of positions in my portfolio up to around 20 by the end of the year.

I am happy with my overall returns for 2013 so far as well as my dividend growth.  My biggest goal is increasing the amount of dividend income I recieve from my portfolio.  So far my dividend income stream is growing nicely as companies raise their payments and as I accumulate more shares.

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12 Responses to Portfolio in Action: Semi Annual Review

  1. Martin says:

    Dan, great review. I like your portfolio. You have great stocks in it. I also aim for about 30 stocks, but sequentially. As my portfolio is small I only hold smaller amount of stocks and adding more stocks as my portfolio grows.

    • Dan Mac says:

      Thanks Martin! I’m building up slowly towards the ultimate number of companies I’d like to own. I try to make purchases with at least $1,000 to help keep trading costs low. So it will take some time before I have the total number of positions I’d like in my portfolio.

  2. Congrats on a good first half! Growing your portfolio and income stream sure is nice. Those are some very solid dividend increases in your holdings so far. I’ve started trying to focus more on adding to current positions rather than initiating new ones, although I did start a new one this morning with my purchase of O. Looks like the REITs are getting hammered again on interest rate increase expectations. Keep up the good work!

    • Dan Mac says:

      Thanks JC. I’m pretty pleased with my dividend growth so far this year.

      Usually when making purchases I look for what I believe is offering the best value at the current moment. However, I also take into consideration if I already have a position in that company and how much of my portfolio that position makes up. For example, I’d love to be buying more Aflac at current prices. However, as you can see it is already my largest holding by far. I want to make sure I’m well diversified so I’m looking elsewhere and adding more total positions to my stable.

      I don’t necessarily have to have all positions in equal weightings but I do like to keep them close as I believe it will help minimize risk over the long run.

  3. Dan,

    Great looking portfolio, and a solid dividend total so far! Keep it up.

    I’m with you on position weights. I also would not like any one position to be more than 5% of my portfolio when it’s all said and done.

    Have a great weekend!

    Best wishes.

    • Dan Mac says:

      Thanks Dividend Mantra, I believe diversification is very important when trying to protect our dividend income streams. If any one company shall falter I don’t want it to have a huge impact on my overall income. Keeping position sizes lower in relation to the portfolio as a whole should help.

  4. Good call on AFL, WFC and COP. I’ll be adding more WFC is it stays around $40 this month.

    • Dan Mac says:

      Thanks Advisor! I think those three companies offer pretty good value right now. As AFL is my largest position I won’t be adding any more at the moment although it is one of my current favorites.

  5. You have a nice portfolio there. I have many of the same stocks and some others on my watch list. Those dividend growth rates are pretty spectacular!

    I like to make purchases based on value as well. I typically save up for one purchase a month and try and select a stock which is undervalued. A difficult task these days. :-/

    • Dan Mac says:

      Thanks Captain, I agree looking for value is a difficult task these days. I think there are still some alright buys available. It’s all about looking around for a good solid buy and pulling the trigger. Long term, I believe paying even slight overvaluations will still work out for us. However, I try to get the undervalued and fair valued first if available!

  6. David King says:

    Your website is interesting. I don’t have a lot of money to invest since I’m disabled with health problems and live on Social Security. I’m 62 yrs. old & my wife is
    55 yrs. old. Since she has a minimum of 7 yrs. before retirement, I don’t consider myself retired. We are investing $300.00 a mo. towards our retirement with DRIP’s with stocks of ABBV, COP, INTC & MCD. IRA stocks are EPD & KMP. Why don’t you have any Drug stocks like ABBV, BMY & Telecomm Stocks like AT&T and VZ? Our next buy stocks are CVX below $118-, MLPL below $50-,& IEP below $75-. We hope to reach our goal of $500,000 to $1,000,000 in our retirement in 7 yrs. Thanks for info.

    • Dan Mac says:

      Thanks David, looks like you are doing a good job saving and investing. Every little bit counts and you show it with your goal of $1,000,000 by retirement time.

      As for why I don’t own any drug or telecom stocks. Honestly it’s just lack of interest in those companies on my end. I don’t quite understand the drug companies and how they work with drug patents expiring and always having to have new drugs in the pipeline. As for telecom, I have considered AT&T before and it is probably on my buy list at some time. However, everytime I think of buying it and review the financials I usually find something I think has better prospects and I’d prefer buying at the moment.

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