Throughout this pandemic, we all have been teetering on wondering if we will have our health, a job, a roof over our heads, and any future at all. It's scary. It's stressful. And it makes all turn inward.
I turned a bit inward in the past month on two fronts. One was to stabilize my portfolio. Put and end to owning high yield but teetering companies and invest in solid companies that are not going to wither away before our eyes.
I did this a bit last August, which I documented here: (BIG SHAKE UP IN MY PORTFOLIO)
I did more this month. I want it to be a leaner and less volatile collection I can feel a sense of comfort with.
In June, I began cutting ties to companies that ended or "suspended" their dividend and but it into some dividend champions that will actually pay me back something. That's why I cashed out on Boeing and put it into Target.
Now in July, I decided to not wait these other companies out with fingers crossed hoping they will recover. I got out and may revisit them once they recover. They will not drag me through that on their path.
I decided to sell my holdings in Bed Bath and Beyond (BBBY), Las Vegas Sands (LVS), General Motors (GM), Delta Airlines (DAL), Brinkler (EAT), and the big shocker, Whitehorse Financial (WHF).
Other than WHF, those shares was earning me zilch. I took some loses on then, yes, but bought companies like Kroger (KR), Tyson (TSN), Western Union (WU), Consolidated Edison (ED), Hormel (HRL), Johnson & Johnson (JNJ), and a few others that will actually return the investment. I also put a chunk of change from my savings and invested.
Before the WHF escape, I added $3,723 to my portfolio that will return a fat $537.50 in dividends. that's a 14.43% yield. I also feel it made the overall portfolio more of what I envisioned it to be. Solid.
Then I had a heart to heart with myself over one of my major players: Whitehorse Financial (WHF).
I got in on them fairly early. They consistently paid a giant dividend and had a relatively low P/E and low dividend payout ratio. So I sunk a large portion into them about 5 years ago and held steady.
Over the past 5 years, the dividend and price stayed stable. Boring but earned me a cool $12,000 in dividends over the past 5 years. A 70% return. Not to shabby.
But with the economy essentially collapsing this spring, WHF found themselves in a rough spot.
Their payout ratio leapt to 947%. Their P/E soared up to 64.53. There is no way they can maintain a dividend at that level. At all. They have not cut it yet, but will. And that will impact the price, so I was facing a double bad hit.
What made it tough was that it was my largest holding. 5% of my whole portfolio and earning 12% of all of my dividends. I had to get out now before watching it wither away. So I sold them last week and got out while I was still over $5,000 ahead when considering dividend earnings.
The WHF sale resulted in a negative $8993.75 invested and a cut of $1,187.80 for the month of July.
A major shock to the system, but my goal of being more diversified can see the light of day.
Here's the chart for the month.
So what did I do with the $12,000 in cash I ended up with? A major look in the mirror.
PART II coming soon and you will see what I did.
I turned a bit inward in the past month on two fronts. One was to stabilize my portfolio. Put and end to owning high yield but teetering companies and invest in solid companies that are not going to wither away before our eyes.
I did this a bit last August, which I documented here: (BIG SHAKE UP IN MY PORTFOLIO)
I did more this month. I want it to be a leaner and less volatile collection I can feel a sense of comfort with.
In June, I began cutting ties to companies that ended or "suspended" their dividend and but it into some dividend champions that will actually pay me back something. That's why I cashed out on Boeing and put it into Target.
Now in July, I decided to not wait these other companies out with fingers crossed hoping they will recover. I got out and may revisit them once they recover. They will not drag me through that on their path.
I decided to sell my holdings in Bed Bath and Beyond (BBBY), Las Vegas Sands (LVS), General Motors (GM), Delta Airlines (DAL), Brinkler (EAT), and the big shocker, Whitehorse Financial (WHF).
Other than WHF, those shares was earning me zilch. I took some loses on then, yes, but bought companies like Kroger (KR), Tyson (TSN), Western Union (WU), Consolidated Edison (ED), Hormel (HRL), Johnson & Johnson (JNJ), and a few others that will actually return the investment. I also put a chunk of change from my savings and invested.
Before the WHF escape, I added $3,723 to my portfolio that will return a fat $537.50 in dividends. that's a 14.43% yield. I also feel it made the overall portfolio more of what I envisioned it to be. Solid.
Then I had a heart to heart with myself over one of my major players: Whitehorse Financial (WHF).
I got in on them fairly early. They consistently paid a giant dividend and had a relatively low P/E and low dividend payout ratio. So I sunk a large portion into them about 5 years ago and held steady.
Over the past 5 years, the dividend and price stayed stable. Boring but earned me a cool $12,000 in dividends over the past 5 years. A 70% return. Not to shabby.
But with the economy essentially collapsing this spring, WHF found themselves in a rough spot.
Their payout ratio leapt to 947%. Their P/E soared up to 64.53. There is no way they can maintain a dividend at that level. At all. They have not cut it yet, but will. And that will impact the price, so I was facing a double bad hit.
What made it tough was that it was my largest holding. 5% of my whole portfolio and earning 12% of all of my dividends. I had to get out now before watching it wither away. So I sold them last week and got out while I was still over $5,000 ahead when considering dividend earnings.
The WHF sale resulted in a negative $8993.75 invested and a cut of $1,187.80 for the month of July.
A major shock to the system, but my goal of being more diversified can see the light of day.
Here's the chart for the month.
|
Ticker
|
Date
|
QTY
|
Price
|
Total
|
DIV INC / Yr
|
YIELD
|
|
|
CSCO
|
7/1/20
|
3
|
$46.1650
|
$138.50
|
$4.32
|
3.12%
|
|
|
HD
|
7/6/20
|
1
|
$250.5650
|
$250.57
|
$6.00
|
2.39%
|
|
|
BMO
|
7/6/20
|
5
|
$53.9387
|
$269.69
|
$21.20
|
7.86%
|
|
|
BBBY
|
7/8/20
|
-260
|
$10.2450
|
-$2663.64
|
$0.00
|
0.00%
|
SELL
|
|
LVS
|
7/8/20
|
-65
|
$44.9600
|
-$2922.33
|
$0.00
|
0.00%
|
SELL
|
|
GM
|
7/8/20
|
-112
|
$24.8600
|
-$2784.25
|
$0.00
|
0.00%
|
SELL
|
|
HRL
|
7/8/20
|
44
|
$47.9560
|
$2110.06
|
$40.92
|
1.94%
|
|
|
TSN
|
7/8/20
|
39
|
$57.7100
|
$2250.69
|
$65.52
|
2.91%
|
|
|
T
|
7/8/20
|
5
|
$30.3150
|
$151.58
|
$10.40
|
6.86%
|
|
|
VZ
|
7/8/20
|
7
|
$54.9150
|
$384.41
|
$17.22
|
4.48%
|
|
|
WU
|
7/8/20
|
34
|
$21.0575
|
$715.96
|
$30.60
|
4.27%
|
|
|
JNJ
|
7/8/20
|
7
|
$142.36
|
$996.52
|
$28.28
|
2.84%
|
|
|
ABBV
|
7/8/20
|
8
|
$99.1750
|
$1785.15
|
$84.96
|
4.76%
|
|
|
OMF
|
7/10/20
|
3
|
$22.7600
|
$68.28
|
$3.96
|
5.80%
|
|
|
PG
|
7/13/20
|
8
|
$125.4500
|
$1003.60
|
$25.30
|
2.52%
|
|
|
OMF
|
7/13/20
|
34
|
$23.7200
|
$806.48
|
$44.88
|
5.56%
|
|
|
ED
|
7/13/20
|
9
|
$72.4550
|
$652.10
|
$27.54
|
4.22%
|
|
|
HRL
|
7/13/20
|
1
|
$48.5700
|
$48.57
|
$0.93
|
1.91%
|
|
|
DAL
|
7/14/20
|
-68
|
$25.8916
|
-$1760.59
|
$0.00
|
0.00%
|
SELL
|
|
KR
|
7/14/20
|
45
|
$33.9173
|
$1526.28
|
$32.40
|
2.12%
|
|
|
KR
|
7/15/20
|
10
|
$33.5750
|
$335.75
|
$7.20
|
2.14%
|
|
|
EAT
|
7/21/20
|
-76
|
$24.1845
|
-$1837.97
|
$0.00
|
0.00%
|
SELL
|
|
ED
|
7/21/20
|
21
|
$74.5500
|
$1565.55
|
$64.26
|
4.10%
|
|
|
KR
|
7/21/20
|
8
|
$34.7373
|
$277.90
|
$5.76
|
2.07%
|
|
|
AES
|
7/22/20
|
2
|
$15.6550
|
$31.31
|
$1.15
|
3.67%
|
|
|
WHF
|
7/24/20
|
-900
|
$9.9850
|
-$8986.30
|
-$1278.00
|
14.22%
|
SELL
|
|
WHF
|
7/24/20
|
-315
|
$9.9401
|
-$3131.06
|
-$447.30
|
14.29%
|
SELL
|
|
OMF
|
7/28/20
|
7
|
$28.2700
|
$197.89
|
$9.26
|
4.68%
|
|
|
MCBC
|
7/30/20
|
17
|
$7.3850
|
$125.55
|
$5.44
|
4.33%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTALS
|
|
|
|
-$8,393.75
|
-$1187.80
|
14.15%
|
current month
|
So what did I do with the $12,000 in cash I ended up with? A major look in the mirror.
PART II coming soon and you will see what I did.
No doubt we all have to look inward these days. The number of dividend cuts witness so far in 2020 is a telltale sign of what's to come. Sure, some companies will weather these days better than others but it's still a guess from here. I sold several of my non-dividend paying stocks too. Mostly spin offs. Raising cash to find cash rich companies like AAPL and MSFT to invest.
ReplyDeleteI'm glad I did
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