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. These 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 (EXC 0.56%) |
$41.36 |
28.818 |
3.4% |
$1,043.21 |
(12.5%) |
|
National Grid |
$48.90 |
20.3693 |
4.9% |
$1,464.96 |
47.1% |
|
Philip Morris International |
$78.05 |
25.5429 |
4.4% |
$2,206.91 |
10.7% |
|
Extendicare |
$6.51 |
548 |
7.1% |
$3,408.56 |
(4.5%) |
|
Ryman Hospitality |
$40.96 |
39.3 |
4.8% |
$1,796.40 |
11.6% |
|
Plum Creek Timber |
$38.42 |
26 |
4% |
$1,145.82 |
14.7% |
|
Brookfield Infrastructure Partners |
$26.12 |
38.2825 |
4.7% |
$1,555.80 |
55.6% |
|
Seaspan |
$17.17 |
136.5 |
6.3% |
$2,966.15 |
26.6% |
|
Retail Opportunity Investments |
$12.20 |
81.95 |
4% |
$1,305.46 |
30.6% |
|
Annaly Preferred D (NLY -0.32%) |
$25.50 |
38.9 |
7.6% |
$960.83 |
(3.1%) |
|
Gramercy Property Trust |
$4.48 |
223 |
2.7% |
$1,159.60 |
16.1% |
|
Cash |
$359.99 |
||||
|
Dividends Receivable |
$19.84 |
||||
|
Original Investment |
$14,983.36 |
||||
|
Total Portfolio |
$19,393.53 |
29.4% |
|||
|
Investment in SPY (including dividends) |
40.4% |
||||
|
Relative Performance (percentage points) |
(11.0) |
Source: Capital IQ, a division of Standard & Poor's.
The total portfolio is now up 29.4%, after climbing 1.1 percentage points from the last report. We gained a nice bit on the index -- 1.4 percentage points -- to lag by 11 points. The blended yield slipped to 5.2%. May is a great month for the account as a number of stocks go ex-dividend, soon followed by the cash flowing into the account. As the market indexes have been slipping, the dividend portfolio has been climbing slowly. And I have a new addition to the portfolio, which I will reveal later.
As I announced last week in this series, I'm selling Exelon and rolling those proceeds over into CorEnergy Infrastructure, a REIT that owns cash-producing energy infrastructure. I'll be making that trade later this week. CorEnergy offers an attractive yield around 7.4% (though that payout doesn't show up on many public finance sites yet -- the better for us). So I think it offers a much better opportunity for market-beating returns. (If you want to read my whole case for CorEnergy, take a 100% free trial to Motley Fool Income Investor.)
In addition, I've decided to buy shares of Awilco Drilling (AWLCF -2.67%), which operates two drilling rigs in the North Sea. The company pays out nearly all of its cash flow as a dividend, though it retains some for maintenance and paying down its debt. The company is benefiting from high day rates in the tight North Sea market and a lenient U.K. tax policy on energy companies. The company is not burdened by debt, and its rigs have a useful life of more than 15 years. So while I would normally dismiss its near-20% yield immediately, I think it deserves a place in this high-yield portfolio. To pay for the purchase, I'm selling my shares in Annaly Series D preferred stock and will add the current cash in the account as well.
Next week, I'll be back with my top five stocks in the portfolio over the next year, highlighting how much upside I think each stock has.
Dividend announcements
Dividend news:
- Extendicare went ex-dividend on April 25 and pays out $0.0362 per share on May 15.
- Plum Creek goes ex-dividend on May 14 and pays out $0.44 per share on May 30.
- Exelon goes ex-dividend on May 14 and pays out $0.31 per share on June 10.
- Brookfield Infrastructure goes ex-dividend on May 28 and pays out $0.48 per share on June 30.
- Extendicare goes ex-dividend on May 28 and pays out $0.0362 per share on June 16.
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, and 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.
