April has been a busy month so far. I’ve done a couple of transactions.
1. I bought 10 additional Peugeot PSA shares at a price of €17,80 each. This is a very small increase but for tactical reasons. Almost 2 years ago I bought 90 Peugeot shares, without having DGI in my mind. I’ve been holding on since then but I would like to quit the position when the stock trades a little bit higher. My objective was to own 100 shares so I am able to sell covered calls on the shares. This way I can boost the profits a little. The transaction fees of around €10 should be covered multiple times by the option premium. Even if it’s only a profit of €20-50, it’s easy money.
2. Sold naked put 1 NN P MAY 2017 28,00 for a premium of €51,55. NN Group is a Dutch based insurance and investment firm. They were trading at a price of €28,85 at the moment of writing but I didn’t intend to buy them. I would rather keep the cash I have now. The option strikes in less than 30 days and my goal is to rack in the premium. It’s a solid company with a big dividend and good earnings. Next to this, I think NN Group did make a good deal buying Delta Lloyd.
3. Sold naked put 1 AH P MAY 2017 18,00 for a premium of €24,55. Ahold Delhaize was trading at around €18,75 when I wrote the option. Once again I don’t intend to buy them, just to rack in the premium. Nonetheless I wouldn’t mind owning them at all. Then I would just sell covered calls…
I’m just a bit short of available cash after my following buys which is why I rather keep the cash in my wallet for better opportunities. However I do like to place a little bet on the price of a stock.
4. Bought 12 shares of dividend aristocrat Johnson & Johnson. This buy was long, long overdue and a lack of them would be a stain on each DGI’s palmares. I took advantage of the small price drop after the earnings announcements last week to buy them at a price of $121,24. I should have bought them way earlier on, but hindsight is 20/20. It’s not a big position, but I’m trying to allocate my capital smartly and if the price would drop more, I’ll buy again. This will raise the net yearly dividend by $22,85. I expect them to increase the dividend soon because they already distributed the same amount for 4 quarters so the time has come.
5. Initiated a small position of 7 shares W.W. Grainger. This industrial supplier company has taken a beating since the earnings report due to lower price settings. However, the MRO market seems to have enormous potential and plenty of room for improvement. The stocks were acquired for a price of $206 each. They have a history of increasing dividends for about 45 years. This adds a net $20,33 to my yearly dividend income. I expect them to increase the dividend next quarter too.
6. Acquisition of 35 shares of chemical company LyondellBasell. However they do operate in a cyclical chemical sector, they manage to gather nice earnings and decent margins. They also buy back shares at a high rate and steady dividend increases are forecasted. For a summary of my reasons to buy the stock, I gladly refer you to LyondellBasell Analysis from The Investment Doctor on Seeking Alpha. It is worth reading. At a current dividend of $3.40/share, the net dividend addition comes in at $70,80. This stock too, is expected to raise its dividend next quarter.
7. Last but not least: in March I had already sold 1 General Mills in-the-money Put OCT 2017 strike $67,50 for a premium of $922,5. I would like to own 100 shares of GIS to grow my dividend portfolio. Because the price dropped even further, I wrote another one but out-the-money this time. 1 General Mills Put OCT 2017 strike $55,00 was sold for $202,5. I don’t expect the stock to go lower than $55 and the premium can decrease my average costs on the first put option when exercised.
I don’t have all the cash available right now if all options would be exercised. However, I will make sure the money will be available when the strike comes close.
Bonus: Unilever recently confirmed it is raising its quarterly dividend by 12%. This means, based on my 110 stocks, an increase of €11,86 without lifting a finger. Gotta love the game!
Dollar dividends converted, my future yearly dividend income should stand around €1,947.
How was your activity so far?