Top 5 Dividend Picks for 2012

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Neil

Top 5 Dividend Picks for 2012

2011 is drawing to a close and it’s been a good year for the Daily Dividend Investor portfolio. My goal for the portfolio this year, was to grow it to the point where it would generate $500/month in passive income. Even though the DDI portfolio falls just a little short one month each quarter, it is producing well above $1500 in quarterly income!

I’m very pleased with that accomplishment.

I’ve already bumped the next goal to $600/month in income, however through some additional capital additions throughout 2012 I’m pushing to get the portfolio up to $1000/month.

As I look back on 2011 there a few stocks that are worth special mention and I wanted to share them with you. So in today’s post I’m going to highlight my 5 Top Dividend Stock Picks for 2012. A few of these stocks are already  owned by the DDI portfolio and others are stocks I’m looking to possibly add in the near future.

A word of caution as you work your way through the list. You shouldn’t just use this as a “buy list”, but rather as a starting point for developing new investment ideas that may help improve your portfolio. If your current portfolio has less than 10-15 holdings, these may not be the right stocks for you now – you may want to look to more large cap / blue chip, Dow components before adding some of the names I’ll be looking at here.

Dividend Increases for Tuesday December 6, 2011

 

Daily Dividend Investor Update

 

To my loyal Daily Dividend Investor readers: Please note that I have migrated the site over to a managed server located at: www.dailydividendinvestor.com

 

I will continue to update this WordPress site with duplicate content for a few weeks,  but you may want to check in at my new hosted location for all the latest content. I am also using a better – easier to read theme that I hope you’ll enjoy. Thanks for reading and following along and don’t forget to LIKE our Facebook page!

 

Thanks!

 

Neil

Dividend Increases for Tuesday December 6, 2011

Five companies announced dividend increases today including a Real Estate Investment Trust (REIT) that increased it’s dividend by 150%!

While none of the yields of any of these companies breaks the 2% range, the fact that so many companies continued to increase their dividend this year is a sign of the business environment continuing to improve.

The Big Winner

SL Green Realty (ticker: SLG) New York City’s largest commercial landlord was the big winner today as it increased it’s dividend from $.40 to $1.00 annually. SL Green Realty pays out a quarterly dividend with the next payment on January  13, 2012 to shareholders of record on January 2, 2012.

Daily Dividend Increases

Also reporting increases today were two annual dividend payers, Balchem Corporation (ticker: BCPC) and Churchill Downs (ticker: CHDN) – both of these firms increased their dividend by 20% year over year.

Rounding out today’s dividend players was Gold Corp (ticker: GG) and J&J Snack Foods (ticker: JJSF) raising their dividends by 31% and 8.5% respectively. For more detailed information about today’s dividend increases please refer to the chart below.

Investment Considerations

As always when evaluating investment opportunities it’s important to keep in mind not only the fundamentals of the stock itself, but also how the holding entity (Limited Partnership, Royalty Trust, Master Limited Partnership, Business Development Company, Preferred Stock) may affect the way you report income on your annual tax return as well as the amount or percentage of tax  you will be required to pay. Adding shares of any of these special entities to tax deferred / retirement accounts may also present additional issues.

Remember to review all of the fundamentals of any company BEFORE investing – do not simply buy a stock based on the dividend payout. If you have further questions about any stock mentioned her you should first consult with your CPA or tax planner / advisor before making any investments.

Monthly Income Update: September 2011

Monthly Income Update: September 2011

When I look back over each month to calculate the total income, I am always amazed that so many “small” deposits (most less than $15) can add up so quickly.

September was no different, with 47 total deposits the DDI portfolio generated passive income of $567.67. That works out be about 1.5 total cash deposits per day, averaged over the entire month and the largest cash deposit since I started tracking the DDI portfolio on the DailyDividendInvestor.com blog!

The best news of all, is that the DDI portfolio generated $1503.59 for the 3rd quarter of 2011, bringing the average monthly income stream to over $500 per month, effectively exceeding my #1 short term goal!

Bought: Investors Real Estate Trust (ticker: IRET)

Looking for niche plays

In continuing to “top off” many of my existing positions I went ahead and added 75 shares of Investors Real Estate Trust (ticker: IRET) to the DDI portfolio today.

Investors Real Estate Trust is probably one REIT you’ve never heard of because it focuses on a very small niche, owning properties in Minnesota and North Dakota. Because of it’s geographic focus, it may be well situated to benefit from the recent economic boom that has been going on in North Dakota within the oil industry.

Risk / Reward

I tend to favor REITs when looking for companies to add to the DDI portfolio because of the fact that they own hard assets which makes it more difficult (but not impossible) for the book value of the company to fall to $ZERO. To be completely honest, owning this stock is all about yield which is currently right around the 7% mark. Adding these shares will increase the first month quarterly payout by $9.75.

As I’ve mentioned before, because most of my individual positions are less that $1000 in value and since the portfolio is on track to make $500/month (and growing) – I’m comfortable with the risk/reward scenario that investing in these shares offers.

Conservative Plays

I’ll look to add on to one of my more conservative holdings for my next investment in an effort to balance the overall risk of the DDI portfolio. Overall the DDI portfolio continues to perform as expected, delivering over $500/month in income in both month 1 and month 3.

With the continued downward pressure on share prices I may begin to add additional outside funds so that I can capitalize on depressed share prices when the market offers them to me. Mostly this will be a function of how well or poorly my other income sources perform in the coming weeks and months. Ideally I would like to build the DDI portfolio up to $250k in base value before leaving it on auto-pilot to become a true unmanned cash flow machine!

Did you enjoy this post?

If so, you might want to check out some of my other recent buys including:

Gladstone Investment Corp

Century Link

Pfizer Pharmaceuticals
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Monthly Income Update: June 2011

Monthly Income Update: June 2011

As I had anticipated, June was a very good month for the DDI portfolio bringing in $556.14 in passive income for the month.

It was the first (and only) month in the 2nd Quarter in which the portfolio reached it’s goal of $500.00/month in passive cash flow.

While the income for the month blew through the monthly $500 goal, beating it handily by over 10%, it wasn’t enough to make up for the short-fall in both April and May.

Monthly Income Update: May 2011

Monthly Income Update: May 2011

I’ve just finished calculating the monthly cash flow for the Daily Dividend Investor portfolio and there is good news and bad news. The good news is that the portfolio generated a very respectable income stream of $499.90 for the month of May. The bad news, which isn’t really so bad, is that for the second straight month, the portfolio missed reaching it’s income target of $500.00/month in passive cash flow.

Overall I am happy with the results and this cash can now be put back to use in the portfolio.

Bought: Public Storage Preferred F – PSA.F

Bought: Public Storage Preferred F – PSA.F

After having my Wells Fargo Preferred (ticker: WSF) redeemed back in late April I had planned to sit tight on my new found cash and wait for a market pull back before redeploying any more funds. However, after reviewing my Investment Advisory Rules for the Daily Dividend Account I decided that I should put some cash back to work sooner rather than later.

What to buy?

After the last few years of watching the Dow (DJIA) peak at 14,000 and then drop to the mid 6000′s it seems like buying stocks would be the last place to look for income. The reality is, even with the recent run up in the dow back above 11,000 there are still good opportunities.

Some might argue that bonds offer more security, but we’ve seen bonds (ala General Motors – GM ) go bust and I for one agree with the thought that a bubble is forming in the bond markets.