As the Market Crumbles...

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Hey Everyone! As we have seen, the market has been stumbling, crumbling, falling, well - you know the rest. This is due to the European Bailout of Ireland and other talks across the world regarding different issues happening. What does that mean for an investor? Well - Bargains! This has been great for investors to pick up discounted stocks that produce even higher yields than before due to the decline. Who do I have my eyes on?

LMT: Lockheed Martin: Currently Trading at $68.20, it just boosted its dividend this quarter, and has done so for the last 10 years Plus! The dividend per share is at $3.00, giving it a 4.40% dividend yield. They are near their 52 week low and are actually a few dollars away from their 5year+ Low! Price to Earnings (P/E) is only 9.63 (I like something below 15 or the average of the S&P 500 Index) with an incredible earnings per share of $7.08. With a $3.00 dividend divided by a $7.08 earnings per share, this gives LMT a payout ratio of 42.4% (I like somewhere between a 40 an 60% range). This shows that they retain earnings for growth opportunities, but also love to give back to their shareholders. Lockheed Martin is in the aeronautics, defense, security sector, with its biggest competitor (according to Google Finance) being Boeing. Now why don't I talk about Boeing? I have nothing against them, but as a dividend investor, Lockheed provides a greater dividend yield and does have proof of incredible dividend growth over the longterm.

I will continue to keep my eye on Lockheed Martin Corporation (LMT) and also a few other companies such as Nokia (NOK) and Banco Santander (STD - Bank in Madrid Spain, has been hit hard due to the fact it is apart of the European Union countries, etc).

Disclosure: I do not make recommendations. This is simply full analysis of Companies. However, Lockheed Martin Corporation is priced right for me and I would consider placing a large investment into them, holding a Long Position. All information is from Google Finance as of 6:00 PM on 11/29/2010.  Thank you.

My Dividend Portfolio as of November 27, 2010

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Today I will display my holdings for individual stocks, their yields and annualized incomes from the stock. (The annualized portion is based on the amount of shares I own X the annual dividend per share.)
I will be displaying this on a frequent basis to show growth in my portfolio from DRIP and other purchases and analysis' that I make.  I am using this as a tool, also, for myself to see how my portfolio is growing.

Symbol Yield Current ShP Annual Income PFE 4.37% $16.49 38.04 CIM 17.73% $4.06 32.51 NGG 7.84% $45.24 62.93 V 0.79% $75.48 3.35 HRB 4.70% $12.77 9.48 ANH 14.08% $6.96 7.84 HIMX 11.57% $2.16 8.25 PRGN 4.26% $3.52 1.50 SHMR 5.83% $13.78 8.04 TOTAL 6.19% 171.93

As you can see, I have a mix of stocks, some speculative some very sound, but it is getting diverse.  I have been choosing individual stocks for about 6 months now and am seeing dramatic results in terms of share price return as well as dividend income growth.  I currently stand at $171.93 in dividend income per year and will post again in December to see if that number has grown - to which I will describe the growth: Dividend Reinvestment or New Funding from my own pocket for growth.

From seeing this simple chart, I see that Visa is a relatively low yield, to which I am not happy.  I purchased them in the mid-upper $60 range and will wait to see what the price does.  They did raise their dividend by 20% for this recent quarter from 12.5 cents to 15 cents per share.  I know it doesn't seem like a lot, but a 20% growth rate is phenomenal.  The reason why I hold on to them is because I feel there is more price appreciation that is there and I want to see if they will continue to make this growth pattern.

Pfizer: PFE, will be paying me dividends this December, as well as Visa (V), and Paragon Shipping (PRGN).  Thus, with dividend reinvestment, this should automatically raise my annualized dividend income, just as long as they continue to make at least the same dividend payment next quarter; this is due to the fact through Dividend Reinvestment I will be owning more shares.

I will report back on another analysis, enjoy the rest of Thanksgiving Break everyone!

-Lanny B.

Disclosure: I do not recommend any particular company. I am therefore Long on all stocks above, but do not provide this chart as a recommendation of any sort. Do your due diligence and find what is suitable for you. Thank You : )

Why Am I "Dividend Investing"?

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Why am I exactly "Dividend Investing" as most call it?

As of right now, my cash flow isn't that strong.  I am a dividend investor because, depending on which broker you use, I can REINVEST my dividends back into the company that provided them to me.  Therefore, I can make more contributions in a company without having to find a way to make that money.  I simply just click a check mark under Dividend Reinvestment online through my broker's website and the dividends are automatically reinvested for me.

What are my goals as a dividend investor one may ask?  To be honest, it is to someday have enough cash flow from dividends alone that they at least equal my monthly expenditures, so that I will not have to work the rat race any more aka the 9 - 5.  I know that it is a risk to rely on dividends, but that is what analysis is for and to always keep up with the companies or funds that you own.

Other reasons why I enjoy dividend investing are the tax benefits (hopefully to be extended after November of this year).  You are taxed either 0 or 15% for Qualified dividends, depending on your tax status (0% for tax brackets up to up to and including the 15% ordinary tax bracket).  Therefore, it's advantageous for dividend investing.

Also, depending on the market, you can receive more shares when you reinvest those dividends if the share price has dropped.  Which hinders back on my last post saying that, virtually if its a good/sound company, you want that share price to drop so that the company paying the *consistently Increasing* dividend can then be reinvested into more shares.

I will post later when they strike my mind on why else I dividend invest.  I will also analyze companies to see if they are worth investing into and post my responses.  Again, This is not advice.  Just merely what I do, Why I do and How I do things.  Thank you.

-Lanny B

What is Dividend Investing?

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For my first post I want to simply introduce the realm of dividend investing.  What is a dividend?  A dividend is simply a portion of the earnings a company pays to its shareholders, either monthly, quarterly, semi-annually or annually.  My main focus will be on common shareholders ( I won't get into preferred shareholders etc.).

There are three dates that every investor needs to know:
"Declaration date: The declaration date is the day the Board of Director’s announces their intention to pay a dividend. On this day, the company creates a liability on its books; it now owes the money to the stockholders. On the declaration date, the Board will also announce a date of record and a payment date.
Date of record: This date is also known as “ex-dividend” date. It is the day upon which the stockholders of record are entitled to the upcoming dividend payment. According to Barron’s, a stock will usually begin trading ex-dividend or ex-rights the fourth business day before the payment date. In other words, only the owners of the shares on or before that date will receive the dividend. If you purchased shares of Coca-Cola after the ex-dividend date, you would not receive its upcoming dividend payment; the investor from whom you purchased your shares would.
Payment date: This is the date the dividend will actually be given to the shareholders of company."

(Compliments to Dividend 101)

Just to get that out of the way.  Why would you want dividends?  No brainer - they provide you with a Cash Flow.  Cash flow is key.  Appreciation = bonus in the end.  I only invest for cash flow or potential future cash flow.  Example, Say you are investing for the "Long Term" why they hell (pardon my language) would it matter if your stock/mutual/reit etc price rose today or dropped today?  If you are a 22 year old man, why the hell would it matter if your share price of Coca Cola dropped $20 today alone?  Answer: It wouldn't matter especially if it was due to irrational behavior or difficult economic times, such as what we have experienced lately. In fact, if it's a stable company and nothing is truly wrong, you'd want it to decline in price, so you can buy more shares while it is "discounted".  It is a huge bonus if they pay a consistent dividend, and even that much better if they always increase in good and bad times.  

Bottom line: Dividend Investing is investing into companies, funds, etfs, reits that provide a consistent yield during the year that can provide you a source of cash flow.  What you do with that cash flow is up to you.  It merely breaks down into 3 options: Keeping the cash for yourself to spend (One).  Reinvesting the dividends back into more shares from that company (Two).  Using the dividend to purchase shares of ANOTHER company (Three).  I will explain in later posts on these 3 options.

Welcome to the world of Dividend Investing.  I will hopefully be able to show you the amazing upside that investing in this manner has and the wonders it may bring.  

Welcome to the Blog!

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Hey Everyone!  Welcome to my new blog based on Dividends from Investment Securities.  I am extremely passionate about preparing for the future, lowering your retirement age and finding a great means to do so.  There are many options to perform this goal, but I have been extremely eager and anxious to talk and learn more about dividend investing.

On this blog I will talk to you about the pros, the cons, facts, assumptions, estimates, companies etc., (the list goes on!) on dividend investing.  I want to take the time to state this:  This blog IS NOT a means to provide advice or action for you to take.  I am simply providing information and knowledge that I have on the matter and am not providing professional advice.  Please consult your advisor or broker if need be.

Sorry, had to get that out of the way to cover myself!  I cannot wait to get started on the miraculous investment vehicle that I like to call: Dividend Investing.  I will consider myself the Young Dividend Guy, as I am 22 years old and am extremely enthused to embark on my own journey using this vehicle.  I have done much research for the past few years on the matter and am ready to share my insight with you.  Thank you for stopping by and I hope that you learn a great deal.  Enjoy : )

-Lanny Berlingieri