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| Dolphin Watch, Cape May, NJ |
I have decided to make weekly purchases into my Loyal3 portfolio in order to stay consistent. Recently the market has been all over the place but that doesn’t bother me because I stay away from all the noise. Oil prices are declining, Ebola is about to spread all over the country and Russia wants to take over Ukraine. These global events can certainly make a huge impact on your stocks. However the recent dips in the market is perfect for someone like me who is still in the accumulation phase of his portfolio. I would much rather buy stocks at a lower price. Of course it’s nice to see the market go up as well because you would be experiencing capital gains. Either way I am happy to invest on a weekly basis in order to dollar cost average into some quality dividend paying stocks. Most of the stocks I invested in this week need no introduction. But I did invest in Starbucks this week, and I feel like I have to justify this buy with great reason. Let’s go over some of the key details for Starbucks and why I would consider a stock that many feel are overly priced.
STARBUCKS (SBUX)
·
I know it may seem overpriced at the current
$75/Share price and I would love to add shares at $68/Share price range. I rely
on cold hard facts though and if you’re waiting for a huge discount it could
take forever. We are talking about a company that is primed for growth and I
wouldn’t be shocked to see SBUX shoot up to $90/Share in less than a year from
now.
·
I am anticipating a lofty dividend raise
announcement in November.
·
Plans of international expansion are on the rise
with Starbucks acquiring 60.5% share of Starbucks coffee Japan.
·
Rising coffee prices are a reason to worry for
coffee drinkers, but not investors. Coffee contains a legal drug known as
caffeine which is highly addictive. People will continue to pay whatever price
for coffee simply because it helps them get through the day. The best part of
going to work in the morning is buying that nice cup of coffee from Starbucks.
In my case it’s Dunkin Donuts.
·
Teavana provides a lot of options for Starbucks
to generate growth.
·
Although the U.S. market is saturated with
coffee brewers, there are major key elements that separate Starbucks from the
rest of the competition. They are innovative and provide a little something for
everyone.
·
Starbucks has provided growth in same –store
sales for the past 18 quarters.
·
Starbucks has proven to be a consistent and
solid performer when it comes to dividend growth.
·
I have high hopes in the long term success that
Starbucks will provide and I love their business model.
·
I am expecting Starbucks to grow earnings by at
least 15% per year in the next few years which will certainly help to increase
their dividend well into the year 2020.
This week I was able to invest into the following solid
companies:
Company
|
Amount
|
Share
Price
|
P/E
|
Div
Yield
|
UNILEVER
(UL)
|
$50
|
$40.50
|
17.76
|
3.74%
|
KRAFT
(KRFT)
|
$50
|
$56.08
|
14.03
|
3.89%
|
YUM
(YUM)
|
$50
|
$69.21
|
21.59
|
2.37%
|
STARBUCKS
(SBUX)
|
$50
|
$74.26
|
246.76
|
1.38%
|
TOTAL
|
$200
|
Average 2.85%
|
Good buys and loving the weekly contributions. I'm trying to at least throw some money weekly to gradually build up my portfolio. If rather see the money go to work instantly than waiting to build up cash for a one time purchase. I like the SBUX addition. I really see rapid dividend growth in their future.
ReplyDeleteHey Agent,
DeleteI feel the same way you do. I would rather makd weekly purchases because it takes a few weeks to save enough for a large purchase. I also like to be able to build a diverse portfolio a lot quicker with Loyal3. I also think SBUX is a great play and I am hoping to see rapid dividend growth.
Solid buys spread over different quarters. Well done!
ReplyDeleteHey anonymous,
DeleteI was hoping to add some more AAPL as well but maybe next week depending on what the market does.
I like the weekly purchases DM. Consistently adding to your portfolio and expanding your base of dividend income will pay off pretty quickly. I picked up three of the same companies, scooping up all of them except SBUX.
ReplyDeleteKeep it up!
Hey W2R,
DeleteI don't think SBUX is that popular among other bloggers, but I feel they will provide a ton of growth for years to come. I don't feel like this is a risky play and I am going to try sneaking in some buys at lower cost basis if I can. I would love to buy in the 60's but I am not sure if they would dip that low. Great job on building your L3 portfolio. Your setting yourself up for a bright future.
I like all your stocks. I agree that Starbucks has plenty room to grow. Everytime I walk into any Starbucks it packed with people. Plus lots of young kids think that best drinks are in Starbucks.. :)
ReplyDeleteI agree that young people really enjoy Starbucks and that's very important. I want to keep dca my position before the share price gets ridiculous. If the market continues to dip I would to buy more but I am not sure if that will happen. Sneaking in small purchases seems like my best option at this point.
DeleteI'm a huge fan of Starbucks, both the stock and their products. Loving the other additions as well!
ReplyDeleteHey Seraph,
ReplyDeleteI am hoping to get great returns from Starbucks for years to come. Maybe these companies can remain at reasonable valuations for a little while so I can add more shares.
Actually think you're handling this perfectly. SBUX is overvalued, yes, but averaging in is a good way to get exposure over time. Further, it forces you to keep an even closer eye on the company, since you actually have skin in the game now. I also like YUM a lot (my girlfriend and I idolize Taco Bell), and am long a small amount, but won't be adding myself for a bit.
ReplyDeleteDD,
DeleteYou said it perfectly when you mentioned I had skin in the game with SBUX. I feel much better having a smaller position that I can keep adding to whenever the price dips a little. The price dipped a little more yesterday so I am thinking of adding another $50 to my current position. I also love the business model for YUM and hope to increase my position with them in the upcoming weeks as well.
Mongrel,
ReplyDeleteGreat job putting away capital on a regular basis!
I hope to join you as a SBUX shareholder at some point. Loyal customers with that company, and there are plenty of growth opportunities still yet ahead.
Best regards!
Mantra,
DeleteI am glad your signing off on this purchase. I also feel like this could be a top performer in my portfolio. Currently KO and AAPL seems to be the top performers but that isn't shocking at all. I hope to see you as a future shareholder of SBUX when the valuation becomes a little more attractive.
Great pick ups all around though I am partial to the UL, KRFT and YUM buys. I agree that SBUX has some strong growth prospects going forward but I am unwilling to pay up that much for it. Good to hear you buying on a regular basis too. That's the name of the game. Thanks for sharing.
ReplyDeleteHey DivHut,
DeleteI agree SBUX is selling at a premium but the price has come down a little due to market volatility. I feel better buying at 72 and currently SBUX is selling for an 11.83% discount from their high of 82.50. It would make me happy to buy more shares in the $60's but investors seem to love the growth potential for SBUX so I don't see much selling off here.