Friday, March 29, 2013

Dividend Growth Portfolio, March 2013

Well after all that excitement in the first 2 months, March was certainly boring. No new purchases, no sales. I did receive a bigger than expected dividend hike from JP Morgan, although I was disappointed Citigroup did not move its dividend at all. The share buyback announcement was good, considering how far below tangible book the shares are trading at, even vs its peers, but I wanted a dividend hike!

How cheap are Citigroup (assuming economy continues to recover) and Bank of America vs its peers and Canada's big 3?

P/B ratios (courtesy of
Bank of America: 0.6
Citigroup: 0.7
 JP Morgan: 0.9
Wells Fargo: 1.3
US Bancorp: 1.8
Toronto Dominion: 1.7
Scotiabank: 1.9
Royal Bank: 2.2


Now, of course, P/B is only one aspect to value banks, but the differential is quite significant here.

Be careful when investing in banks though. Their stock prices tend to be very volatile because their earnings are very cyclical. The usual rule when investing applies here as well. Stick to best of breed. JP Morgan, TD, Scotiabank (in no particular order) are my favorites in the group.

New Purchases


Intrinsic Dividend Changes
Scotiabank - $27.72 (quarterly div +5.3% from 57 to 60 cents)
JP Morgan - $64.00 (quarterly div +26.7% from 30 to 38 cents)
General Dynamics - $18.00 (quarterly div +9.8% from 51 to 56 cents)

February 2013 Annualized Dividend: $4613.11

+ $0 (from new purchases)
-  $0 (from sales)
+   $109.72 (from intrinsic changes)

March 2013 Annualized Dividend: $4722.83

End of 2013 Goal: $4700 to $5000
Whisper Goal: $5500

YTD Dividends Received: $959

2013 Dividends Received Goal: $4200
Whisper Goal: $4600

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