Dividend Income – May 2015
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It is hard to believe how fast 2015 is flying by. We are almost half way through the year now and our dividend income portfolio keeps chugging along on its own – with a little help from my wife and I. There is certainly nothing flashy or sexy about investing in dividend stocks – other than building a cash producing machine for life!
May was certainly not a record month for dividend income. It just happens to be one of the slowest months of the year traditionally for the Money Sprout Index. That is because only 4 stocks in our portfolio paid a dividend in May.
The good news is that despite a low income month, we took huge steps in laying the foundation for great things to happen with our dividend income. Just last month we significantly increased our 12 month future dividend income numbers and I am pumped up about the rest of 2015.
Here are our dividend income results for May, 2015 –
2015 May Dividend Income Results
As I mentioned before, May is generally one of those slow dividend income months that doesn’t normally get me too excited. What does pump me up though is the amount of new investments we were able to make this month since we decided to invest our tax return this year. The details are below, but we saw our 12 month forward dividend income shoot up from all these new investments.
For reference purposes, I like to look back and compare my dividend totals from the same month over the past couple of years. This helps us see the growth of the Money Sprout Index and keeps my wife and I motivated in meeting our goals.
Here are the dividend income earnings for the month of May from the past 3 years and our total for 2015 –
- May 2012 – $28.46
- May 2013 – $38.31
- May 2014 – $37.48
May 2015 Dividend Income – $48.52
As you can see from previous years results, we saw a slight dip in May dividend income between 2013 and 2014. That was a result of shifting some money around within the portfolio. This year’s results have shot back up by over 30% so we are back on the right track.
Here is the breakdown of dividend income (by stock) in May, along with the number of new shares added from DRiP –
- The Clorox Company (CLX) – $23.84 (.22 shares)
- Lowe’s Companies Inc. (LOW) – $5.63 (.08 shares)
- The Proctor & Gamble Company (PG) – $11.63 (.15 shares)
- Verizon Communications Inc. (VZ) – $7.42 (.13 shares)
Note – All of the dividends we currently receive are reinvested into new shares of the same stock using DRiP – except those purchased through our LOYAL3 and Robinhood accounts.
New Capital Invested in May
May was certainly a big month for investing new capital into the Money Sprout Index. Since my wife and I decided to invest our tax return in dividend stocks this year (instead of 529 plans) we had a lot more capital to work with.
We made our normal ongoing monthly investments through LOYAL3 and Computershare (K, MSFT, UL, VZ, and WMT). In addition, we also opened up new positions in several stocks (CAT & OHI) and added to existing postions (BHP & O) through lump sum investments.
Here are the new investments we made in May –
- $716.18 lump sum investment in BHP Billiton Limited (BHP) – 16 shares
- $1,041.84 lump sum investment in Caterpillar Inc. (CAT) – 12 shares
- $927.35 lump sum investment in Realty Income Corporation (O) – 20 shares
- $1,258.75 lump sum investment in Omega Healthcare Investors Inc. (OHI) – 35 shares
- $50 automatic investment in Kellogg Company (K) – .77 shares
- $100 automatic investment in Microsoft (MSFT) – 2.09 shares
- $50 automatic investment in Unilever (UL) – 1.12 shares
- $50 automatic investment in Verizon (VZ) – 1.01 shares
- $25 automatic investment in WalMart (WMT) – .33 shares
During May, we continued all of our monthly automated investments through LOYAL3 that were made in the previous four months of the year. These include $50 investments in Kellogg Company (K) and Unilever (UL), a $100 investment in Microsoft (MSFT), and a $25 monthly investment in WalMart (WMT).
Note – We will be making a few changes to our automated investments starting in June.
We also made our monthly $50 investment in Verizon (VZ) through Computershare.
There were several lump sum investments made in the Money Sprout Index during May. We opened up brand new positions in Caterpillar (CAT) and Omega Healthcare Investors (OHI) through our no cost brokerage – Robinhood. Both of these companies seem to have been beaten down a little in the market lately, so we thought is was a perfect time to invest in them.
We also added to our positions in BHP Billiton Limited (BHP) and Realty Income Corporation (O) through lump sum investments in our Robinhood account.
The total amount of new capital invested in May was – $4,219.12
Here are the new investment totals for the year –
- January Investments – $475.00
- February Investments – $1,067.30
- March Investments – $652.26
- April Investments – $1,094.77
- May Investments – $4,219.12
New 2015 Investments – $7,508.45
12 Month Forward Dividend Income
This is the third month where we are tracking our 12 month forward dividend income. While this number does not guarantee any future dividends, it is a good indicator of how much income we will earn over the next 12 months.
Our 12 month forward dividend income will increase month to month as a result of 3 different factors. The first is any time we add new shares of stock (i.e. CAT, O, etc.) to the Money Sprout Index, our future dividends should go up.
Second, any dividends that are reinvested back into new shares of stock through DRiP (i.e. CLX, LOW, etc.) will increase our forward dividend income.
Finally, anytime a company raises its annual dividend – we will see a spike up.
12 Month Forward Dividend Income
- March 2015 – $1,239.21
- April 2015 – $1,288.31
- May 2015 – $1,501.44
Comparing the past three months, our 12 month forward income has grown by 21% or by $262.23!
Note – The majority of the increase between April and May was due to $4,000+ being invested. While we certainly welcome the increase in future dividend income, it will not be sustainable for the remainder of the year. We expect about a $50 increase each month in future dividend income for the rest of 2015.
The dividend income earned the past month ($48.52) from 4 stocks was our highest May ever! Despite it being a traditionally low dividend income month, there are plenty of reasons to be optimistic for the growth of our portfolio. The biggest reason is that we now have passed $1,500 in future dividend income and it still has tons of room to grow this year!
To date, we have earned a total of $441.14 in dividend income for 2015. At that rate, we would earn less than $1,200 in annual dividend income this year. Since our goal is to earn $1,500 this year, we have a lot of work to do over the next 7 months.
On a positive note, our 3-month rolling average continues to increase each month. The average of the past 3 months makes it easier to track month to month totals. During May, we were able to raise our 3 month rolling average again, which built on what we accomplished last month. Our rolling average is now $103.18, which was an increase of $.79.
We should see significant growth from our 3-month rolling average for the remainder of 2015. Why? All the new money that we have been investing will eventually push our dividend income and 3-month rolling average higher. I am certainly looking forward to seeing what the remainder of 2015 holds!
How was your dividend income in May? What stocks are you buying in this market?
Full Disclosure – At the time of this writing, we owned shares in the following stocks noted in this post – BHP, CAT, CLX, K, LOW, MSFT, O, OHI, PG, UL, VZ, and WMT. The material above is not a recommendation to buy. Please do your own research on a company before deciding to invest.