As long time readers may know, one of our goals for 2016 is to receive over over $13,000 in dividend income. Considering that we received slightly over $10,000 in 2015, we know we need to buy some high quality dividend paying stocks throughout 2016 to make this challenging goal. Although we've purchased over $35,000 so far in 2016 (using 1 to 1 conversion rate between US and Canadian), we still have a bit of work to do.
So the other day I decided to purchase the following stocks:
30 shares Brookfield Energy Partners (BEP.UN)
17 shares of Target (TGT)
Both of these purchases add to our existing shares.
We originally added Brookfield Energy Partners to our portfolio back in April. Since then, the stock price has climbed slightly. I continue to like the renewable energy sector and I think BEP.UN is well positioned to capture opportunities in the renewable energy sector. The company has more than doubled the size of its asset base in the last few years and will continue to grow and expand into new countries. At about 5.96% dividend yield, the dividend yield is higher than your average dividend paying stocks. However, the company is only paying out about 70% of funds from operation and plan to grow annual payout in the 5 - 9% range. BEP.UN's net income grew by 60.56%, year over year, to $0.16 per share during the most recently completed quarter. This was amount the strongest growth seen by any company in this sector. At 7.04% net profit margin, the company should continue to grow. If the numbers continue to look this good, and we expect them to be, we will buy more BEP.UN shares in the future.
Like Brookfield Energy Partners, we only added Target to our dividend portfolio earlier this year. Given that Target has raised dividend payout for 48 years straight, I am a little surprised that we don't own more of this stock. The stock price bounced between $65 and $85 this past 52 weeks. At the current price of around $70, I think it gives us a good opportunity to add more shares. One of the downsides of Canadian dividend paying stocks is that they are heavily concentrated in the financial and energy sectors. There are very few Canadian dividend paying stocks in the consumer staple sector (many are paying too low dividend rates to be considered). In order to increase our allocation in the consumer staples sector, we must add stocks in the US and international markets. We are monitoring a few consumer staple dividend paying stocks. Let's hope the Canadian dollar will get stronger later this year so allow us exchange US dollar in a better rate.
These two recent buys added $112.80 in our annual dividend income.
Dear readers, what do you think about these two recent buys?
By the way, if you like this little blog of mine, I would really appreciate if you can dominate me for the Plutus Award. 🙂