It has been a bit quite on the investing front as of late for the PIV portfolio. As I have mentioned before, activity for the portfolio, particularly that of buying equity shares, has not been as frequent as I had envisioned at the beginning of the year, primarily due to valuations that on the whole appear to rather expensive despite many believing such premiums are justified given the historically low bond yields that are often seen as the alternative investment to equities. In any event, dividends continued to trickle in during November, below is the latest summary and YoY comparison.
As noted above, the increase in YoY dividend income for the month of November was 17.7%. Most of that growth was fueled by a fairly new position in CVS Inc, which has experienced some nice price appreciation in recent months as investors have warmed to the earnings and FCF metrics the company is experiencing since the merger with Aetna. The political rhetoric has turned favorable as well which seems to have benefited all health insurers in recent months. I was hoping the CVS stock price would stay flat for a while but just doesn't appear that is going to be the case, with that said, the stock still appears undervalued from nearly all metrics, so it remains a consideration for additional capital. Also contributing to the growth from the volume of shares held is the additional purchase of GIS that was made in December of last year when the stock prices fell significantly with the rest of the market.
From a dividend growth rate perspective, the portfolio experienced a 3.4% favorable rate increase. The highest YoY rate increases come from DAL and ABT at 15% and 14.3%, respectively. A few positions noted above have not raised their dividend in the past year, namely, CVS, GIS, and CLDT. CVS and GIS set expectations some time ago that dividend growth would not be a priority in the short term as the companies focus on reducing debt that both took on to fund acquisitions.
As noted above, the increase in YoY dividend income for the month of November was 17.7%. Most of that growth was fueled by a fairly new position in CVS Inc, which has experienced some nice price appreciation in recent months as investors have warmed to the earnings and FCF metrics the company is experiencing since the merger with Aetna. The political rhetoric has turned favorable as well which seems to have benefited all health insurers in recent months. I was hoping the CVS stock price would stay flat for a while but just doesn't appear that is going to be the case, with that said, the stock still appears undervalued from nearly all metrics, so it remains a consideration for additional capital. Also contributing to the growth from the volume of shares held is the additional purchase of GIS that was made in December of last year when the stock prices fell significantly with the rest of the market.
From a dividend growth rate perspective, the portfolio experienced a 3.4% favorable rate increase. The highest YoY rate increases come from DAL and ABT at 15% and 14.3%, respectively. A few positions noted above have not raised their dividend in the past year, namely, CVS, GIS, and CLDT. CVS and GIS set expectations some time ago that dividend growth would not be a priority in the short term as the companies focus on reducing debt that both took on to fund acquisitions.
Lastly, below is snapshot of P/E and dividend yields for the major indexes. It is hard to get excited about deploying capital into stocks when the market indexes are trading at historically high P/E multiples. It may be a good time for me to retrieve my book bought some years ago titled Irrational Exuberance, written by Robert Schiller. The title of the book was a phrase originally used by former Federal Reserve Board chairman Alan Greenspan in response to the excessive valuations that appeared during the DOT com bubble of the late 1990s. In short, the book is about investor enthusiasm that drives asset prices up to levels that aren't supported by fundamentals. It is books and articles like these that can help value investors remain grounded when others may be experiencing the fear of missing out (FOMO). I am sure I could dig up some good quotes from Buffett's shareholder letters that will also help put these market prices in perspective.
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