The World's Best Dividend Portfolio

The latest news on these dividend dynamos.

Mar 3, 2014 at 1:34PM

In June 2011, I invested my money equally in a selection of 10 high-yield dividend stocks. With a year of success behind me, in July 2012, I added even more money to the portfolio, and then more again in 2013. Those names offer triple the yield of the average S&P 500 stock. You can read all the details here. Now let's check out the results so far.

Company

Cost Basis

Shares

Yield

Total Value

Return

Exelon

$41.36

28.818

4.1%

$876.36

(26.5%)

National Grid

$48.90

20.3693

5.2%

$1,421.78

42.7%

Philip Morris International

$78.05

25.5429

4.6%

$2,066.68

3.7%

Extendicare

$6.51

548

6.9%

$3,518.16

(1.4%)

Ryman Hospitality (NYSE:RHP)

$40.96

39.3

4.7%

$1,658.07

3%

Plum Creek Timber

$38.42

26

4.1%

$1,125.54

12.7%

Brookfield Infrastructure Partners (NYSE:BIP)

$26.12

38.2825

5.1%

$1,431.77

43.2%

Seaspan (NYSE:SSW)

$17.17

136.5

5.7%

$2,977.07

27%

Retail Opportunity Investments (NASDAQ:ROIC)

$12.20

81.95

4.3%

$1,215.32

21.6%

Annaly Preferred D

$25.50

38.9

8%

$910.26

(8.2%)

Gramercy Property Trust

$4.48

223

0%

$1,293.40

29.5%

Cash

     

$161.14

 

Dividends Receivable

     

$65.38

 

Original Investment

     

$14,983.36

 

Total Portfolio

     

$18,720.90

24.9%

Investment in SPY (including dividends)

       

39.1%

Relative Performance (percentage points)

       

(14.2)

Source: Capital IQ, a division of Standard & Poor's.

The total portfolio is now up 24.9%, after climbing 0.3 percentage points from the last report. We lost on the index, by a 1.5 percentage points, to lag by 14.2 points. The blended yield remained at 5.1%. Dividends and dividends receivable continued to flow into the account, and there's plenty more on the way.

That yield has been rising thanks to recent dividend increases from several of our stocks. Retail Opportunity Investments just raised its quarterly payout almost 7%, from $0.15 to $0.16 per share. We'll also soon see a raise from Ryman Hospitality, which announced a 10% bump to its dividend, to $0.55 per share per quarter. Brookfield Infrastructure did even better, moving its dividend from $0.43 to $0.48 quarterly -- an increase of nearly 12%. These are very solid increases, and I love to see our dividend stocks continue to pay us back more and more year after year.

And there should be even more announced today from Seaspan. Seaspan management has said clearly that it was committed to its "progressive dividend policy," meaning dividends should march up quickly.

Ryman came out with solid earnings last week, and I'm pleased with the guidance, which also has the potential to be exceeded if the company can get its relationship with Marriott straightened out. Marriott last year took over much of the marketing of Ryman's properties and there have been quite a few headaches in getting things to run well. Ryman seems to think everything is ready to run smoothly in the next couple months, however.

At around 11 times forward guidance for funds from operations and a 5.2% yield, Ryman is quite cheap. It would make an excellent addition at today's prices. I'm looking to see whether the company buys back shares, as the CEO suggested he would do following the company's conversion to a REIT just over a year ago.

Dividend announcements
Dividend news:

  • Plum Creek went ex-dividend on Feb. 12 and pays out $0.44 per share on Feb. 28.
  • Extendicare went ex-dividend on Feb. 26 and pays out $0.0362 per share on March 17.
  • Exelon went ex-dividend on Feb. 12 and pays out $0.31 per share on March 10.
  • Seaspan went ex-dividend on Feb. 13 and paid out $0.3125 per share on Feb. 26.
  • Brookfield Infrastructure went ex-dividend on Feb. 26 and pays out $0.48 per share on March 10.
  • Annaly Series D went ex-dividend on Feb. 27 and pays out nearly $0.47 per share on March 31.

All that, of course, means more money coming into our pockets.

It's fun to sit back and get paid, and with the market volatility, we might have a good chance to reinvest those dividends at good prices. Europe continues to be an absolute mess, and continued bad news will likely have stocks plunging again. If they do, I'll be inclined to pick more shares up.

Foolish bottom line
I've been a fan of big dividends for a while, and I think this portfolio will outperform the market over time through the power of dividends. As I promised in the original article, I'll continue to track and report on the portfolio's progress, including news on these companies.

If you like dividends, consider the 11 tickers above along with the nine names from a free report from Motley Fool's expert analysts called "Secure Your Future With 9 Rock-Solid Dividend Stocks." Today I invite you to download it at no cost to you. To get instant access to the names of these nine high yielders, simply click here -- it's free.

Jim Royal owns shares of all 11 companies listed in the table and Extendicare and has the following options: long May 2014 $22 calls on Seaspan and short May 2014 $30 calls on Seaspan. The Motley Fool owns shares of Extendicare, Gramercy Property Trust, Retail Opportunity Investments, Ryman Hospitality Properties, and Seaspan and has the following options: long May 2014 $22 calls on Seaspan and short May 2014 $25 calls on Seaspan. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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