Adding to Two Positions I Already Own — AMGN and NSRGY

I’ve been busy with work, vacation, and the holiday season, which has kept me from writing a couple of posts. The great thing, though, is that even though I’ve been busy, my dividend income has kept rolling in. December has always been a great month for dividend income, and I’m really looking forward to seeing what the total is this year.

But for now, here’s a post about two additional purchases of stocks that I already own:

As most of you know, stocks in the US in general are getting kind of expensive from a valuation standpoint. Dividend stocks in particular have done great, likely because most people are starved for yield and subsequently have been bidding the prices ever higher.

There are, however, a few industries and individual stocks out there that have trended down. One industry which has not done that well post Trump’s election has been biotechnology. In fact, I recently sold nearly my entire share of Gilead (GILD) to harvest some of those capital losses for tax purposes. I will, one way or another, be buying GILD back as soon as the 30 days are up. In fact, I have a put option currently opening on GILD at a strike price of $72 expiring at the end of January. I’ll either let that get assigned or just buy back the 90 shares that I sold plus more.

One biotech stock that I decided to dollar cost average down rather than sell at a loss is Amgen (AMGN). On 12/9/2016 I purchased an additional 33 shares of AMGN. This lowered my cost basis from around $158/share to $152/share. It also increased my annual dividend from $253.75 to $405.55, an increase of $151.80.

My second purchase is the large multinational Swiss food, Nestle (NSRGY). I’ve had Nestle in my portfolio for awhile now. It isn’t the most common of dividend stocks since it pays only once a year (in May). It does have a nice yield of 3.41% currently and is sitting at a slight paper loss since I bought it. On 12/22/2016 I purchased an additional 113 shares, which increased its annual dividend from $72.52 to $345.69, an increase of $273.17.

Overall, these two purchases bring my forward twelve-month dividend up to $5401.85. This will be even higher come January when I repurchase the GILD shares that I sold for tax loss purposes.

I’m excited about getting paid again in a few days. Looking forward to putting more money to work!

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7 Responses

  1. Nice buy. AMGN is one that I’ve been selling puts on. I haven’t bought any shares yet though. I have the same put open with GILD, but at $72.50; I’ll happily add 100 more shares at that price.
    Investment Hunting recently posted…2016 Goals RetrospectiveMy Profile

    • scott says:

      Thanks! It’s looking like we’ll both be buying some GILD at the end of January if we don’t decide to roll. I’m probably going to let this put get executed rather than roll because I’m looking to buy it again after selling most of it to lock in a tax loss, and it is much lower than what my per share cost basis is currently.

      Scott

  2. I’ve thought about adding AMGN for a while but the rollercoaster nature of biotechs always concerns me. Nice dividend though!

    TheDividendLife.com

    • scott says:

      You could maybe sell some puts on AMGN and the other biotechs? The volatility really helps with getting good premium. Thanks for the comment!

  3. Jay says:

    Thanks for the update. Isn’t it great how your dividend stocks keep working for you? Selling GILD for a tax-loss as probably also a smart play… I should have been paying more attention!
    Jay recently posted…7 Trading Psychology Ideas From Dr. Brett SteenbargerMy Profile

    • scott says:

      Thanks, Jay. Yep, dividend stocks are pretty great. The GILD sale has worked out well. It is looking like I’ll be able to buy it back for less than I sold it for by just letting my put get executed. It has a strike price of $72 and is currently in the money.

      Scott

  4. Solid buys! Would like to own some Amgen myself but as the dollar is pretty strong now, I’m still in waiting position.

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