Author name: Steve

A pretty legit dude.

JULY DIVIDENDS

2016, Dividends /

I received $380.16
in dividends in JULY.

Every quarter there are 3 months or dividend payouts, this is the smallest one.

Monthly Dividends per Year 2016
Month 2015 2016 2016 $INC 2016 %INC Q OVER Q INC
April $201.00 $313.00
July $200.00 $380.00 $180.00 90.00% 21.41%

Last July my dividend total was $200 giving me a year over year increase of 90%!

My quarter over quarter increase was 21.41% and my total dividend haul this year is now $3221.

Is it just me or does anyone else feel like Gollum from lord of the rings every time you receive a dividend payment? My PRECIOUS!!

Market Musings


The Dow hit a record high in July off weak earnings.

I like to use the Schiller P/E ratio to gauge the value of the overall market.

July – S&P 500 had a Shiller P/E: 26.9.

That is 61.1% higher than the historical mean of 16.7

Prof. Robert Shiller of Yale University, who won the Nobel Prize in Economic Sciences in 2013 – invented the Schiller P/E to measure the market’s valuation. Schiller also predicted the crazy P/E ratios of the late 90’s would turn out to be a bubble.

I continue to move to safety.

Moves in JULY


Total Purchases $5580

Total Sales $1997

I sold 100 shares of KMI this month.

I bought 219 shares of TSE:XLB Canadian Long Term Bond ETF for $25.47 per share for a total of $5577. This brings my total share to 299. I plan to add more of this next month unless the market drops in which case I will buy more stocks.

I will look to buy if the DOW gets as low as 17000.

 

JULY DIVIDENDS Read More »

My Total Savings So Far

Savings /

The beginning of the year is the hardest to save for but I was fortunate to have worked a fair amount of overtime. Some expenses that pop-up are property tax, house insurance, utility tax and lurking bills from Christmas.

This year will be the first time I am prepaying my property tax by monthly payments so I don’t have to save an extra $3000 next June.

 

2016 savings
Date Amount Saved Net Pay %
1/1/2016 $2,000.00 $3,150.00 63.49%
1/15/2016 $2,000.00 $2,960.00 67.57%
1/29/2016 $2,200.00 $3,480.00 63.22%
2/12/2016 $2,100.00 $2,700.00 77.78%
2/26/2016 $2,000.00 $3,700.00 54.05%
3/11/2016 $3,000.00 $4,120.00 72.82%
3/25/2016 $3,000.00 $4,400.00 68.18%
4/8/2016 $3,000.00 $4,300.00 69.77%
4/22/2016 $2,000.00 $3,290.00 60.79%
5/6/2016 $2,000.00 $2,800.00 71.43%
5/20/2016 $3,500.00 $4,600.00 76.09%
6/3/2016 $2,000.00 $2,600.00 76.92%
6/17/2016 $2,000.00 $3,050.00 65.57%
7/1/2016 $2,000.00 $2,840.00 70.42%
7/15/2016 $0.00 $950.00 0.00%
7/29/2016 $1000  $2100.00 47.62%
8/12/2016 #DIV/0!
8/26/2016 #DIV/0!
9/9/2016 #DIV/0!
9/23/2016 #DIV/0!
10/7/2016 #DIV/0!
10/21/2016 #DIV/0!
11/4/2016 #DIV/0!
11/18/2016 #DIV/0!
12/2/2016 #DIV/0!
12/16/2016 #DIV/0!
12/30/2016 #DIV/0!
#DIV/0!
EXTRA TAX RETURN $3,000.00 #DIV/0!
Year Total Year Total Pay Saved %
$38,100.00 $51,040.00 74.65%

On Track

I’m on track to pass my last year total of $46,180. Summer is usually pretty slow and I don’t expect to start saving too much until Sept.

My hard capped bills are $650 bi-weekly. Not much room to wiggle this down anymore.

I brought my bills down this year by getting rid of my cell phone. This saves me around $800 per the year. My wife insists that we keep are land line telephone so I decided to see how cheap I could get it. I argued with my provider for about 10 mins and got it knocked down from $30 a month to $9. This will save me $252 per year as well.

I’m currently saving 74.65% of my after tax income. I aim for 50% or greater but most people suggest a minimum of 20%

I’m always looking for ways to spend less and save more so feel free to give me any helpful tips.

 

 

My Total Savings So Far Read More »

Payout Ratio

Financial Jargon /

What is it?

The payout ratio, or dividend payout ratio, is how much money the company earns (EPS) compared to what it is actually paying out to its shareholders in dividends (DPS), typically expressed as a percentage.

As a formula it looks like this:

For any dividend investor this is perhaps one of the most important metrics but probably the least used in practice.

The reason the Payout Ratio is important is because it give you the clearest indicator if the potential for a dividend cut is coming. If a company is paying out more in dividends then it earns the Payout Ratio will tell you all about it.

 

How does it work?

  1. DIVI-CENTS CORP has an earnings per share of $1 and dividends payout of $0.70 per share. This shows it has a Payout Ratio of 70%. Not Bad. Now lets look at the competition.
  2. DIVI-MART INC has an earnings per share of $2 and dividends of $2.55 per share. The Payout Ratio is 125%. Not too good!

Which company has the more sustainable dividend payout?

In some cases, a payout ratio can exceed 100 per cent.

Why should you care?

Depending on DIVI-MART INC balance sheet, it could possibly dip into it cash reserves or borrow depending on it’s credit, to keep the dividend going. The problem is a company can’t pay out more than 100% forever. Sooner or later it will be forced to do one of two things.

  1. Hope they can earn more money in the near future to cover dividend or
  2. Cut the dividend to a sustainable level

More often than not a company will cut it’s dividend.

As a dividend investor, this is the worst case scenario. When a company cuts it’s dividend, it’s usually a sign of distress and can cause a chain reaction. 

Typically, when this happens, investors flee, causing the share price to drop so that the investor who stays ends up with a company worth less as well as a reduced dividend payment. 

When you notice some holes in the ship, it’s better to flee and get your toes wet then to be stuck on board when it goes down and realize, there is no life vest.

A good read in this link. Oil investors see $7.4-billion vanish as dividends targeted

Further Reading

Payout Ratio Read More »