As many of my readers may know, I love dividend stocks and believe dividends provide a great source of passive income. Quarterly, I provide updates regarding my dividend income, dividend goals and if I buy dividend stocks.
Using ‘The Dividend Report‘ section of my blog, I share the progress of my goals. I also share dividend growth stock ideas and thoughts. Additionally, I will share the rational behind any future purchases or sales. Dividends are truly a wonderful thing.
The Dividend Report
For over a year, I have been working towards the same goal. I would like my average dividend income to provide $1,500/month. As I solidify my path to financial independence, I want dividends to be 25-33% of my monthly retirement income. However, this goal may be revised upwards over time.
Q4-2017 Dividend Income
This may be the most excited I’ve been to share a dividend report. Quarter 4 of 2017 (Q4) marks the end to another year. This means a lot of things.
I now have 5 years of dividend data! I cannot believe I’ve been tracking my progress for so long.
My portfolio also generates the most income in Q4. A few of the funds I own pay larger dividends at the end of the year in addition to their regular payment.
This was a great year for my dividend income. Ten of my stocks increased their dividend payouts. Two stocks are paying the same amount and one cut their dividend. This means I got paid more money to do nothing. Thats right I made more money for doing absolutely nothing.
Apple ($AAPL): 10.53% increase.
BP ($BP): no change.
Citi ($C): 100% increase.
Disney ($DIS): 7.69% increase.
Gilead ($GILD): 10.64% increase.
Gaslog LTD ($GLOG): no change.
Corning ($GLW): 14.81% increase.
General Electric ($GE): -50% decrease.
Kraft Heinz ($KHC): 4.17% increase.
Raytheon ($RTN): 8.87% increase.
Starbucks ($SBUX): 20.0% increase.
Verizon ($VZ): 2.08% increase.
Wells Fargo ($WFC): 2.63% increase.
The graph below shows my dividend income history since 2013:
The table below shows my dividend history since 2013:
2016 Dividend Income vs 2017 Dividend Income
This year my total dividend income was $3,651.28. Last year, in 2016, I made $2,827.67 from dividends. That means I made $823.61 more this year from dividends. This is a 29.1% increase; I am very happy with this increase.
There are two main reasons for the increase. First, I maxed out my 401k. This was the second year in a row of this goal. Regularly contributing to a 401k is one of the 6 steps to a 6-figure net worth.
Second, 10 of my 13 stocks increased their dividend payout. This means I own the same amount of shares. Each share now pays me more for owning the same great company. How awesome is that?
My average monthly dividend income is now $304.27 ($3,651.28 / 12 months = $304.27), which is 20.28% of my current goal of $1,500/month. Previously I was at 16.94% of my goal. For 2018, I am hoping to significantly improve my dividend income. I would like to reach my dividend goal by no later than 2019. This is a lofty goal but worth a shot.
This quarter vs. last quarter
My Q4-2017 dividend income was $2,092.46. Last quarter (Q3-2017), my income was $537.76. This is a $1,554.70 or 289.11% increase from the previous quarter. This is misleading for a few reasons. A handful of my funds do not pay a dividend in Q3. As a result the same funds pay multiple dividends in Q4. Some of the funds also provide a larger dividend in Q4.
In past four quarters, my total dividend income was $3,651.28 (~$584 increase annually). I am proud to report this is a continuing trend upwards. This growth is fueled by my individual stocks increasing their dividends and continuing to invest (mostly via index funds).
Q4-2017 vs Q4-2016
Last year’s Q4 dividend income was $1,507.92. This quarter I earned $2,092.46. This is $584.54 or 38.76% more compared to last year.
I did not buy any individual stocks during the past quarter. I am considering buying Allergan ($AGN). The company’s stock price has fallen significantly. The firm offers some great products like botox, which has dozens of uses. The company also has a competitive line of generic drugs. Allergan has an interesting pipeline of drugs being developed as well.
The valuation is relatively cheap. The stock currently trades at ~10 x forward P/E. There are some legal headwinds still facing the stock. However, the risk reward seems modest and the company recently started paying a dividend.
I may also consider buying more General Electric ($GE) if the price continues to drop. Long term I believe the company will be fine. Short term, things will be rough. Looking to add to my position if the share price drops below $16.
I am still buying index funds as I am automating my way to financial independence. However, I may consider buying vanguard dividend growth fund.