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In September 2011, I did some in-depth research to find long term sustainable dividend stocks and have been doing updates on this Ultimate Sustainable dividend portfolio since then in the attempt to show how well such a portfolio can perform over the long term. I would personally say that things have been going very well and will certainly continue to evolve. I do have a few more things planned which I will discuss in the near future.
The USDP is obviously a critical part of my now very public quest to replace my job income with passive income. you can see my most recent update here.
The past month has been a great one with the overall markets doing very well. I’ll also be trading for the USDP in the coming days and have more about that later in this post. I’ll be looking for 1-2 new stocks and will be going through the process in the newsletter in the next few days.
If ever you would like to receive those types of updates, please join, it’s free:
Keep in mind that this portfolio was built by selecting 20 stocks out of thousands. The goal is not to pick the best dividend stocks but rather to pick a diversified, high quality portfolio that will keep dividends increasing over time.
Here are the holdings as of last night to start off:
Ticker Name Shares May 13 2014 Price May 13 2014 Values
OMC Omnicom Group Inc 31 $68.77 $2,131.87
MSFT Microsoft Corp 74 $40.42 $2,991.08
JCI Johnson Controls Inc 41 $45.08 $1,848.28
PEP PepsiCo Inc/NC 29 $87.23 $2,529.67
ETN Eaton Corp 33 $73.20 $2,415.60
DOV Dover Corp 25 $86.58 $2,164.50
KN Knowles Corp 12.5 $30.02 $375.25
ITW Illinois Tool Works Inc 29 $86.90 $2,520.10
XLNX Xilinx Inc 39 $46.18 $1,801.02
SJM JM Smucker Co/The 20 $100.40 $2,008
BLK BlackRock Inc 12 $302.96 $3,635.52
TROW T Rowe Price Group Inc 30 $81.32 $2,439.60
OXY Occidental Petroleum Corp 23 $97.52 $2,242.96
COP ConocoPhillips 26 $78.64 $2,044.64
XOM Exxon Mobil Corp 21 $102.36 $2,149.56
ADI Analog Devices Inc 45 $51.47 $2,316.15
HAS Hasbro Inc 31 $55.50 $1,720.50
MAT Mattel Inc 44 $39.74 $1,748.56
INTC Intel Corp 55 $26.45 $1,454.75
AFL Aflac 30 $63.73 $1,911.90
BAX Baxter International 25 $75.41 $1,885.25
IVZ Invesco Ltd 68 $36.04 $2,450.72
VWO Vanguard FTSE Emerging Markets 61 $42.19 $2,573.59
BND Vanguard Total Bond Market 34 $81.80 $2,781.20
Cash $1,050.81
USDP $53,191.08
SPX 15.32335164 $3,427.01 $53,513.28
Dividends Received
Wow.. the below chart looks AMAZING:) I’m very excited to say that the USDP will end up generating $179 this month, setting a new record. It’s not enough to live by but we’re clearly making progress here. Part of the reason is the $1000 that I’m investing every month but the portfolio has also performed extremely well.
Ultimate Sustainable Dividend Portfolio News
Some positive news as 3 stocks will be paying a bit more:
| XOM | Exxon Mobil Corp | Dividend increase from $0.63 to $0.69, a 9.5% increase |
|---|---|---|
| BAX | Baxter International | Dividend increase from $0.49 to $0.52, a 6.1% increase |
| IVZ | Invesco Ltd | Dividend increase from $0.225 to $0.25, a 11.1% increase |
Returns
As has been fairly typical, in a month where the market performed extremely well, the USDP underperformed slightly which is what you’d generally expect from an income focused portfolio.
Trades
| Ticker | Name | DVD 1Y Growth | DVD 5Y Gr. | Sales 5Y Gr | EPS 5Y Gr. | Payout Ratio | P/E |
|---|---|---|---|---|---|---|---|
| OMC | Omnicom Group Inc | 23.08 | 21.67 | 5 | 8.4 | 42.88 | 17.73 |
| MSFT | Microsoft Corp | 24.42 | 17.39 | 8.56 | 16.94 | 35.19 | 14.26 |
| JCI | Johnson Controls Inc | 10.81 | 9.54 | 11.37 | N/A | 41.77 | 14.68 |
| PEP | PepsiCo Inc | 5.58 | 5.95 | 9.29 | 3.01 | 51.2 | 19.7 |
| ETN | Eaton Corp PLC | 13.75 | 12.72 | 14.9 | N/A | 42.74 | 17 |
| DOV | Dover Corp | 8.06 | 9.2 | 6.84 | 34.26 | 25.71 | 16.45 |
| KN | Knowles Corp | N/A | N/A | N/A | N/A | 0 | N/A |
| ITW | Illinois Tool Works Inc | 9.33 | 6.27 | 3.59 | N/A | 43.8 | 21.84 |
| XLNX | Xilinx Inc | 14.29 | 13.18 | 10.29 | 18.77 | 42.26 | 20.73 |
| SJM | JM Smucker Co/The | 10.78 | -17.71 | 4.57 | 21.53 | 41.59 | 17.66 |
| BLK | BlackRock Inc | 12.78 | 17.44 | 26.6 | 65.73 | 39.01 | 17.6 |
| TROW | T Rowe Price Group Inc | -34.17 | 10.25 | 20.54 | 54.98 | 38.19 | 20.89 |
| OXY | Occidental Petroleum Corp | 16.81 | 15.58 | 16.22 | 45.77 | 34.9 | 13.91 |
| COP | ConocoPhillips | 3.41 | 7.75 | 2.28 | 38.44 | 41.66 | 14.38 |
| XOM | Exxon Mobil Corp | 10.26 | 9.75 | 12.64 | 20.8 | 34.31 | 13.93 |
| ADI | Analog Devices Inc | 12.1 | 11.68 | 6.66 | 78.78 | 60.32 | 23.49 |
| HAS | Hasbro Inc | 10.14 | 15.3 | 1.88 | N/A | 72.88 | 23.4 |
| MAT | Mattel Inc | 13.18 | 14.25 | 4 | N/A | 55.2 | 16.27 |
| INTC | Intel Corp | 0 | 9.95 | 13.66 | 57.25 | 46.56 | 14.32 |
| AFL | Aflac Inc | 5.88 | 7.57 | 3.69 | 14.37 | 20.9 | 10.32 |
| BAX | Baxter International Inc | 16.32 | 15.47 | 7.07 | N/A | 49.7 | 15.67 |
Possible – ITW, HAS, COP
Do you automatically reinvest dividends in some kind of DRIP plan?
@Ken – Yes either a DRIP or a do-it-myself one depending on stocks, etc.
I have another question. If your portfolio performs about the same as the S&P 500, why not just buy SPY instead of your entire basket?
I guess I do hope to beat the S&P500 over time, especially when markets go south. Also, the dividend yield in my portfolio is significantly higher than the S&P500. And finally, I prefer to avoid some sectors (such as banks for example) which is easier to do this way.