Portfolio Update (October 2015)

October marks a good end with all, except one, of my shares moving into profits from losses. Hopefully this trend will continue and build up the much needed buffer in December when the Fed is to announce if interest rates is to rise.

Stock markets seems to be doing fairly well this month with Dow Jones Industrial Average (DJI) up by 8.47%. The impact of the rising of interest rates by the Fed seems to be wearing off. We shall see if the Fed will definitely increase the interest rates at the end of the year. Hopefully, my portfolio will have increased enough to withstand the fall in stock price and stay positive, thus the month of November will be crucial.

Consolidation of my portfolio will be done annually, instead of monthly as I initially planned. This is to reduce the commission fees to be paid so that the savings can be “passed” over to my profits.

Stock Holdings

Stock holdings as of October 31, 2015. Cost basis is the total invested amount, including dividends that were reinvested and the commissions and taxes paid. This cost will be used in the percentage calculations for YTD dividends, and profit and loss.

Stock Symbol Shares Cost Basis
Home Depot, Inc. HD 4.01400 $480.55
Johnson & Johnson JNJ 5.02812 $509.59
Automatic Data Processing, Inc. ADP 6.02550 $476.12
Clorox Co CLX 4.00000 $456.79
PepsiCo, Inc. PEP 5.00000 $471.74
Abbott Laboratories ABT 11.00000 $491.57
Total Investment Amount $2,886.36

Dividends

Automatic Data Processing, Inc (NASDAQ: ADP) paid a total of $2.94 of dividends, before tax, on October 01. The dividend has been converted to 0.02550 worth of shares at $80.8599 each via DRIP.

Abbott Laboratories (NYSE: ABT)  began trading ex-dividend on October 13, 2015, with cash dividend of $0.24 per share to be paid on November 15, 2015.

Stock Symbol YTD Dividends
Home Depot, Inc. HD $2.36 0.49%
Johnson & Johnson JNJ $3.75 0.74%
Automatic Data Processing, Inc. ADP $2.94 0.62%
Clorox Co CLX $0.00 0.00%
PepsiCo, Inc. PEP $0.00 0.00%
Abbott Laboratories ABT $0.00 0.00%
Total Dividends $9.05 0.31%

Profit & Loss

The month of October was a great month. Most of the stocks in my portfolio had turned to profits from losses with the exception of Johnson & Johnson (NYSE: JNJ), which went back into the reds on the last few days of the month.

Stock Symbol Profit/Loss
Home Depot, Inc. HD $15.66 3.26%
Johnson & Johnson JNJ $1.70 0.33%
Automatic Data Processing, Inc. ADP $48.04 10.09%
Clorox Co CLX $30.97 6.78%
PepsiCo, Inc. PEP $39.31 8.33%
Abbott Laboratories ABT $1.12 0.23%
Total Profit/Loss $133.40 4.62%

Portfolio Update (September 2015)

Third month into the start of my new portfolio and I have added four more companies into my portfolio. From October onwards, I will start the consolidating phase, adding more shares to the six companies and reviewing the portfolio for changes to the companies that I will want to invest in.

Third month since I started on my new portfolio and after reviewing of my investment plans, I had made investments and added four more companies into the portfolio.

The third company that I had added into my portfolio was Automatic Data Processing, Inc. (NYSE: ADP). Bought 6 shares of ADP at $77.1975 each. The additions to the portfolio was followed by 4 shares of Clorox Co (NYSE: CLX) at $111.70, 5 shares of PepsiCo, Inc. (NYSE: PEP) at $92.35 and 11 shares of Abbott Laboratories (NYSE: ABT) at $43.78.

After buying all the shares that I had planned for this year, marking the end of the portfolio’s building phase. From October onwards, I will be moving into the consolidation phase where I will start buying more shares once a year and will be expecting to collect dividends once a month (surprising the dividend distributions are spaced out quite evenly). The dividends collected will be reinvested to buy more shares using DRIP.

Stock Holdings

Stock holdings as of September 30, 2015. Cost basis is the total invested amount, including dividends that were reinvested and the commissions and taxes paid. This cost will be used in the percentage calculations for YTD dividends, and profit and loss.

Stock Symbol Shares Cost Basis
Home Depot, Inc. HD 4.01400 $480.55
Johnson & Johnson JNJ 5.02812 $509.59
Automatic Data Processing, Inc. ADP 6.00000 $473.18
Clorox Co CLX 4.00000 $456.79
PepsiCo, Inc. PEP 5.00000 $471.74
Abbott Laboratories ABT 11.00000 $491.57
Total Investment Amount $2,883.42

Dividends

Johnson & Johnson (NYSE: JNJ) paid a total of $3.75 of dividends, before tax, on September 09. The dividend has been converted to 0.02812 worth of shares at $93.1624 each via DRIP.

Home Depot, Inc. (NYSE: HD) has also paid a total of $2.36 of dividends, before tax, on September 17. The dividend has been converted to 0.01400 worth of shares at $118.1616 each via DRIP.

ADP began trading ex-dividend on September 09, 2015, with cash dividend of $0.49 per share to be paid on October 01, 2015.

Stock Symbol YTD Dividends
Home Depot, Inc. HD $2.36 0.50%
Johnson & Johnson JNJ $3.75 0.76%
Automatic Data Processing, Inc. ADP $0.00 0.00%
Clorox Co CLX $0.00 0.00%
PepsiCo, Inc. PEP $0.00 0.00%
Abbott Laboratories ABT $0.00 0.00%
Total Dividends $6.11 0.21%

Profit & Loss

The month of September was with a lot of uncertainties. There were a lot of anticipations that the Fed will be raising their interest rates but when the announcement that the interest rates were not to raise this month, signalling that the global economy is still dangerously weak. That drove the stock prices to fall sharply.

Stock Symbol Profit/Loss
Home Depot, Inc. HD $16.23 3.39%
Johnson & Johnson JNJ $39.08 7.69%
Automatic Data Processing, Inc. ADP $8.98 1.90%
Clorox Co CLX $5.33 1.17%
PepsiCo, Inc. PEP $0.24 0.05%
Abbott Laboratories ABT $49.15 10.00%
Total Profit/Loss $90.43 3.14%

Portfolio New Addition: Automatic Data Processing

The third company stock to be added into my portfolio is Automatic Data Processing, Inc. (NASDAQ: ADP). The company is listed as one of the S&P 500 Dividend Aristocrats which means they have increased their annual dividends payout for over 255 years. A look at the rationale behind investing in ADP and a reminder to why I should continue holding on to it.

Automatic Data Processing logo | Investor MonkeyAutomatic Data Processing, Inc. (NASDAQ: ADP) is a provider for human capital management solutions for employers and computing solutions to vehicle dealers.

ADP operates through three business segments: Employer Services, Professional Employer Organisation (PEO) Services and Dealer Services.

Serving more than 430,000 clients via ADP’s software as a service (SaaS), the company also provides outsourcing solutions enabling their clients to outsource their HR, time and attendance management, payroll and benefits.

Rationale for Addition to Portfolio

Another company belonging to the S&P 500 Dividend Aristocrats that I have added into my portfolio. Though I did not intentionally find companies within the list to invest in but the list of companies that I have filtered as possible investments mostly comes from the S&P 500 Dividend Aristocrats list.

This has become one of the rationale for adding ADP into my portfolio – a company within the S&P 500 Dividend Aristocrats means it has paid increasing annual dividends for over 25 years. And with the ability to do so likely means ADP is likely to continue increase their annual dividends in the years to come.

Over the past five years, ADP has grown their dividends at 3.3% annual (on average) while Earnings per Share (EPS) grew at 5.1%. The EPS is not growing a lot faster than their Dividends per Share (DPS) as EPS for fiscal year 2015 saw a dip of 2.9%. Furthermore, with a dividend payout ratio at 62.0%, they still have room for their dividends to grow with a need to monitor the EPS will grow faster than the DPS to bring down the payout ratio.

I will continue to monitor the earnings for ADP to ensure that this dip is indeed a one-off incident.

I was contemplating whether to add ADP into my portfolio with another company (which I shall not mention now) and what made me decide on add ADP in this month’s investment is really because ADP has got Ex-Div on September 9 and thus September 8 is really the last day to buy the share to be entitled for the upcoming dividend payment in October.

Transaction Details

Date September 08, 2015
Shares 6
Price 77.1975
Yield (TTM)* 2.54%
* as at time of purchase