During this past year I have been acquiring shares of some great consumer staple companies. Earlier this year, I picked up shares of General Mills (GIS) and J.M. Smucker Co (SJM) and have been adding to them. Now I have a another new position that I am excited about. Details of the purchase are as follows:
On Wednesday, Oct. 11, 2017, I purchased shares in Campbell Soup Co.
Purchased: 44 shares x $45.70 = $2,011 (commission free)
Annual Dividend Income: $61.60 ($0.35/sh paid quarterly in Jan, Apr, July, and Oct)
P/E ratio: 16 (vs. S&P @ 22)
Debt to capital < 50%: Yes, 47%
Interest coverage ratio of at least 3:1: Yes, 12.5
Current dividend yield > 1.5x S&P yield: Yes, 3.0% vs. S&P @ 2.0%
Payout ratio < 60% (or <85% for utilities): Yes, ~45%
Expected growth of 5% or better: Yes, however, may be inconsistent from year to year as has been the during this past decade. Nonetheless, I expect both earnings and dividend growth will outpace inflation and be at least 5% or better on average over the coming 10+ years.
Metrics reflected above were retrieved from Morningstar.com and/or CFRA's stock report.
My kids devour the Pepperidge Farm Goldfish Crackers we buy from Wal-Mart or Costco on a regular basis. The forward income generated from this purchase would equate to the cost of roughly a dozen or so boxes annually; so at least we will now be seeing a larger fraction of this expense return to our pocket. I purchased this stock a day before the ex-div date so I will be collecting a dividend payment at the end of this month.
As referenced above, I have been purchasing GIS and SJM in recent months, both of which I hold in my Fidelity 401(k) Roth account. I will likely be making additional purchase of either of the two aforementioned stocks within the next month if current valuations hold steady or decline further. I hold CPB in my taxable brokerage account at Merrill Edge.
What do you think, anyone else watching this stock closely? What stock are you watching closely?
On Wednesday, Oct. 11, 2017, I purchased shares in Campbell Soup Co.
Purchased: 44 shares x $45.70 = $2,011 (commission free)
Annual Dividend Income: $61.60 ($0.35/sh paid quarterly in Jan, Apr, July, and Oct)
P/E ratio: 16 (vs. S&P @ 22)
Debt to capital < 50%: Yes, 47%
Interest coverage ratio of at least 3:1: Yes, 12.5
Current dividend yield > 1.5x S&P yield: Yes, 3.0% vs. S&P @ 2.0%
Payout ratio < 60% (or <85% for utilities): Yes, ~45%
Expected growth of 5% or better: Yes, however, may be inconsistent from year to year as has been the during this past decade. Nonetheless, I expect both earnings and dividend growth will outpace inflation and be at least 5% or better on average over the coming 10+ years.
Metrics reflected above were retrieved from Morningstar.com and/or CFRA's stock report.
My kids devour the Pepperidge Farm Goldfish Crackers we buy from Wal-Mart or Costco on a regular basis. The forward income generated from this purchase would equate to the cost of roughly a dozen or so boxes annually; so at least we will now be seeing a larger fraction of this expense return to our pocket. I purchased this stock a day before the ex-div date so I will be collecting a dividend payment at the end of this month.
As referenced above, I have been purchasing GIS and SJM in recent months, both of which I hold in my Fidelity 401(k) Roth account. I will likely be making additional purchase of either of the two aforementioned stocks within the next month if current valuations hold steady or decline further. I hold CPB in my taxable brokerage account at Merrill Edge.
What do you think, anyone else watching this stock closely? What stock are you watching closely?
I'm sure you were expecting this comment. Man oh man does this stock analysis look similar and similar to my last watch list :) Congrats on the great purchase. My niece and nephew also devour goldfish snacks like it is no ones business. Reasons 1-5 of why I love consumer staple stocks.
ReplyDeleteBert
Bert,
ReplyDeleteThanks for stopping by and commenting. CPB and many other stocks in the same sector have been too expensive to consider in recent years. I am glad to finally see a retreat in valuations to a level I am more comfortable with to the point where I am willing to initiate and build a position.
PIV