I’m having trouble finding value in many of the more commonly known dividend payers, such as The Coca-Cola Company (KO) and Johnson & Johnson (JNJ).  In fact, many of these stocks are at or near all time highs.  When looked at thru the lens of a fastgraph, these stocks are predicted to only offer mid-single digit returns over the next 5 years.

So, I’ve had to look much closer at the more cyclical sectors of the market, such as technology, energy, and basic materials.  That’s where I see value right now and the potential for decent returns in the future.

With those themes in mind, this month I added shares of the following companies:

Apple (AAPL):  The lowering of earnings estimates and the recent uncertainty of what the company has planned for all of it’s cash has led Apple to swoon from over $700 per share to sub $400 within the last few months.  Now that the company has declared how they will return value to shareholders with a massive share buyback and dividend increase, I think we will see a floor in the stock price and the possibility of future dividend growth over time.

International Business Machines Co (IBM):  Earnings and revenue miss = temporary stock price drop = buying opportunity

Intel Corporation (INTC):  Another laggard of the tech sector.  Just averaging down on my cost basis and enjoying the dividend yield.

BHP Billiton plc (BBL):  When commodity prices take a hit, mining conglomerates like (BBL) take it on the chin.  Long term, I think this is a great hedge against inflation.

BP PLC (BP):  If BP can ever get past the Gulf Of Mexico spill, the stock price and dividends should return to pre-spill levels.  In  the meantime, an almost 5% dividend can’t hurt.

I also continue to add shares of the Schwab Emerging Markets Equity ETF (SCHE) when the price dips.  Even though the yield on this ETF is sub 3%, I think the potential for long term earnings growth is strong and the yield will gradually increase over time.  Plus, emerging markets offer the potential for strong capital gains as well.

This is an update of my dividend income investing portfolio for May 1st 2013. The linked table below shows changes that were made to this real world dividend portfolio during the month of April 2013.

Dividend Portfolio Table May 2013

I plan to update this dividend portfolio every month.

Here is a written summary of the portfolio changes that occurred in April 2013:

Dividends Reinvested:

Coach Inc (COH) added 0.2375 shares ($12.00)

Cisco Systems (CSCO) added 0.8284 shares ($17.08)

General Electric (GE) added 3.8234 shares ($84.66)

GUESS? Inc (GES) added 0.3856 shares ($9.80)

iShares DJ US Financial Sector ETF (IYF) added 0.01165 shares ($0.79)

iShares DJ US Home Construction ETF (ITB) added 0.00084 shares ($0.02)

Kaydon Corporation (KDN) added 0.8009 shares ($20.43)

The Coca-Cola Company (KO) added 0.9216 shares ($37.49)

Leggett & Platt Inc (LEG) added 0.4491 shares ($14.70)

Lockheed Martin (LMT) added 0.3868 shares ($36.94)

CapLease Inc (LSE) added 2.3386 shares ($15.50)

Main Street Capital Corporation (MAIN) added 0.4475 shares ($13.60)

Medtronic Inc (MDT) added 0.7746 shares ($36.09)

Altria Group Inc (MO) added 1.9212 shares ($68.67)

PepsiCo Inc (PEP) added 0.3225 shares ($25.69)

iShares S&P U.S. Preferred Stock Index ETF (PFF) added 0.268 shares ($10.80)

PowerShares International Dividend Achievers Portfolio ETF (PID) added 1.2841 shares ($21.63)

Prospect Capital (PSEC) added 1.4451 shares ($15.23)

SYSCO Corporation (SYY) added 0.8959 shares ($31.24)

Universal Health Realty Income (UHT) added 0.6038 shares ($34.86)

Vanguard Value ETF (VTV) added 0.4654 shares ($30.47)

Vanguard Emerging Markets Stock ETF (VWO) added 0.1087 shares ($4.65)

Wal-Mart Stores Inc (WMT) added 0.1454 shares ($11.00)

Dividends Not Reinvested:

Armanino Foods of Distinction (AMNF) ($18.00)

Shares Bought or Sold:

Bought 3 shares Apple (AAPL) for $1,269.13 (cost basis: $423.04 share).  This purchase added $36.60 in annual dividend income to the portfolio.

Bought 21 shares BHP Billiton plc (BBL) for $1,183.06 (cost basis: $56.34 share).  This purchase added $46.83 in annual dividend income to the portfolio.

Bought 52 shares BP PLC (BP) for $2,202.01 (cost basis: $42.35 share).  This purchase added $109.72 in annual dividend income to the portfolio.

Bought 6 shares International Business Machines Co (IBM) for $1,149.25 (cost basis: $191.54 share).  This purchase added $20.40 in annual dividend income to the portfolio.

Bought 71 shares Intel Corporation (INTC) for $1,494.98 (cost basis: $21.06 share).  This purchase added $63.90 in annual dividend income to the portfolio.

Bought 46 shares Schwab Emerging Markets Equity ETF (SCHE) for $1,142.76 (cost basis: $24.84 share).  This purchase added $25.76 in annual dividend income to the portfolio.

Sold 261.7725 shares Met Pro Corporation (MPR) for $3,498.72 (sell price: $13.36 share).  This sell resulted in a reduction of approximately $75.91 in annual dividend income to the portfolio.  This sell was the result of a takeover offer for Met Pro Corporation (MPR) from CECO Environmental Corp (CECE) resulting in a strong capital gain for the dividend income portfolio.

Dividend Increases or Decreases:

Apple (AAPL) increase in the quarterly dividend to $3.05 per share versus previous quarterly dividend of $2.65 per share resulting in an approximate $16.00 increase in annual income.

Coach Inc (COH) increase in the quarterly dividend to $0.3375 per share versus previous quarterly dividend of $0.30 per share resulting in an approximate $6.03 increase in annual income.

CSX Corporation (CSX) increase in the quarterly dividend to $0.15 per share versus previous quarterly dividend of $0.14 per share resulting in an approximate $13.58 increase in annual income.

Johnson & Johnson (JNJ) increase in the quarterly dividend to $0.66 per share versus previous quarterly dividend of $0.61 per share resulting in an approximate $9.78 increase in annual income.

Kinder Morgan (KMI) increase in the quarterly dividend to $0.38 per share versus previous quarterly dividend of $0.37 per share resulting in an approximate $3.14 increase in annual income.

LinnCo LLC (LNCO) increase in the annual dividend to $3.08 per share versus previous annual dividend of $2.84 per share resulting in an approximate $6.72 increase in annual income.  This dividend rate will be implemented over the next few months, with a change from quarterly dividend payments to monthly dividend payments.

Overall Dividend Income Portfolio Results:

Annual Dividend Income as of May 1st 2013:

$8,264.79

Monthly Dividend Income as of May 1st 2013:

$688.73

Average Portfolio Yield on Cost as of May 1st 2013:

4.38%

Increase in Annual Dividend Income for the month of April 2013:

$297.17

Increase in Monthly Dividend Income for the month of April 2013:

$24.76

Increase in Total Cost Basis for the month of April 2013:

$6,229.24

The next update for this portfolio should be on June 1st, 2013.

I sold my position in Miller Industries Inc (MLR).  The stock has been very cyclical over the last few years and is one of the few stocks to show NO gain since I bought it.  Also, when reviewed on Fastgraphs, the predicted annual returns for (MLR) are less than 3% for the next 5 years.

I invested the money from the liquidation of Miller (MLR) into more shares of Prospect Capital (PSEC).  This added a nice bit of yield to the portfolio.

Despite the concerns and predictions of the pundits, we have yet to see a serious correction in the market. 

Will this bull market continue, juiced up on QE infinity?

I don’t know if it will or if it won’t, but I have my plan of adding more and more shares of dividend paying stocks to the income portfolio each month.  I’ll try to add shares that are undervalued and avoid the “penalty box” of overpaying for shares.

(Housekeeping Note:  I quit using the embedded table with each monthly update.  Now, the table is included as a PDF document that you can download by clicking on the link below.  I think this makes the blog posts more user friendly.  It also makes it easier to print the table for future reference.)

Dividend Table April 2013 PDF

This is an update of my dividend income investing portfolio for April 1st 2013.  The linked table above shows changes that were made to this real world dividend portfolio during the month of March 2013.

I plan to update this dividend portfolio every month.

Here is a written summary of the portfolio changes that occurred in March 2013:

Dividends Reinvested:

Archer Daniels Midland (ADM) added 1.2103 shares ($39.88)

AFLAC Inc (AFL) added 0.5825 shares ($29.10)

Conoco Phillips (COP) added 0.9993 shares ($57.91)

CSX Corporation (CSX) added 1.9788 shares ($47.26)

Dover Corporation (DOV) added 0.2406 shares ($17.70)

Emerson Electric (EMR) added 1.3269 shares ($75.99)

Halliburton (HAL) added 0.0658 shares ($2.65)

Harris Corporation (HRS) added 0.3417 shares ($15.25)

Intel Corporation (INTC) added 4.4535 shares ($93.79)

Johnson & Johnson (JNJ) added 0.3774 shares ($29.60)

Kohl’s Corp (KSS) added 0.3776 shares ($17.50)

Main Street Capital Corporation (MAIN) added 0.3828 shares ($13.04)

McDonald’s Corporation (MCD) added 0.766 shares ($75.98)

Met Pro Corporation (MPR) added 1.8401 shares ($18.85)

Mine Safety Appliance (MSA) added 0.3228 shares ($15.79)

Microsoft Corp (MSFT) added 0.8174 shares ($23.00)

iShares S&P U.S. Preferred Stock Index ETF (PFF) added 0.1533 shares ($6.17)

Prospect Capital (PSEC) added 1.3538 shares ($15.08)

Phillips 66 (PSX) added 0.0832 shares ($5.34)

R.R. Donnelley & Sons Company (RRD) added 2.7567 shares ($28.57)

Unilever Plc ADR (UL) added 0.3768 shares ($15.42)

UMH Properties Inc (UMH) added 1.7388 shares ($17.82)

Walgreen Co (WAG) added 0.7277 shares ($30.81)

Waste Management (WM) added 0.608 shares ($23.35)

Schwab U.S. Large-Cap Value ETF (SCHV) added 0.6777 shares ($24.03)

Shares Bought or Sold:

Bought 4 shares Apple (AAPL) for $1,715.49 (cost basis: $428.87 share). This purchase added $42.40 in annual dividend income to the portfolio.

Bought 22 shares Caterpillar Inc (CAT) for $1,954.83 (cost basis: $88.86 share). This purchase added $45.76 in annual dividend income to the portfolio.

Bought 49 shares GUESS? Inc (GES) for $1,242.28 (cost basis: $25.35 share). This purchase added $39.20 in annual dividend income to the portfolio.

Bought 105 shares Prospect Capital (PSEC) for $1,159.23 (cost basis: $11.04 share). This purchase added $138.72 in annual dividend income to the portfolio.

Bought 28 shares Raytheon Co (RTN) for $1,612.51 (cost basis: $57.59 share). This purchase added $61.60 in annual dividend income to the portfolio.

Bought 55 shares Schwab Emerging Markets Equity ETF (SCHE) for $1,399.48 (cost basis: $25.44 share). This purchase added $30.63 in annual dividend income to the portfolio.

Bought 49 shares Wells Fargo & Co (WFC) for $1,772.95 (cost basis: $36.18 share). This purchase added $58.80 in annual dividend income to the portfolio.

Sold 71.7862 shares Miller Industries Inc (MLR) for $1,162.57 (sell price: $16.19 share). This liquidation resulted in a reduction of approximately $40.20 in annual dividend income to the portfolio.

Dividend Increases:

CapLease Inc (LSE) increase in the quarterly dividend to $0.0775 per share versus previous quarterly dividend of $0.075 per share resulting in an approximate $2.00 increase in annual income.

Cisco Systems (CSCO) increase in the quarterly dividend to $0.17 per share versus previous quarterly dividend of $0.14 per share resulting in an approximate $12.06 increase in annual income.

Main Street Capital Corporation (MAIN) increase in the monthly dividend to $0.155 per share versus previous monthly dividend of $0.15 per share resulting in an approximate $5.26 increase in annual income.

Miller Industries Inc (MLR) increase in the quarterly dividend to $0.14 per share versus previous quarterly dividend of $0.13 per share resulting in an approximate $2.87 increase in annual income.  This position was liquidated.

Wells Fargo & Co (WFC) increase in the quarterly dividend to $0.30 per share versus previous quarterly dividend of $0.25 per share resulting in an approximate $9.80 increase in annual income.

Overall Dividend Income Portfolio Results:

Annual Dividend Income as of April 1st 2013:

$7,967.62

Monthly Dividend Income as of April 1st 2013:

$663.97

Average Portfolio Yield on Cost as of April 1st 2013:

4.36%

Increase in Annual Dividend Income for the month of March 2013:

$424.74

Increase in Monthly Dividend Income for the month of March 2013:

$35.40

Increase in Total Cost Basis for the month of March 2013:

$9,678.82

The next update for this portfolio should be on May 1st, 2013.

I added shares of Prospect Capital (PSEC), a business development company, that invests in the debt and equity of middle market companies.  Their portfolio consists of some names that I know, such as Totes Isotoner Corporation, and many that I am not familiar with at all.  The dividend is paid monthly and the yield is over 11% right now.

Another stock that I added was QR Energy LP (QRE).  This MLP owns oil and gas producing properties in the US and pays distributions quarterly.  It issues a K-1 at tax time and I’m interested in how that will affect my tax filing next year.  I guess we’ll see about that.

Then, when YUM Brands (YUM) announced that food contamination problems had damaged their operations in China, I added this global restaurant brand to the portfolio on the stock price dip.

Also, I took a chance and added a few shares of Apple (AAPL) to the portfolio.  I’m thinking they are going to return more cash to their shareholders either via an increased dividend payout ratio or through the occasional special dividend.  Either way, I’ll take their cash.

I also added to some of my existing dividend holdings including:

Conoco Phillips (COP)
MicroFinancial Incorporated (MFI)
Schwab International Equity ETF (SCHF)

Plus, since I am underweight emerging markets in the portfolio, I started adding a little Schwab Emerging Markets Equity ETF (SCHE) here and there.  I plan to gradually build this position up over time, since there is no commission for trading this ETF inside my Schwab account.

In other news, I’m getting rid of my remaining electric utility stocks.  PPL Corp’s  most recent dividend increase was mediocre at best, and with Exelon (EXC) cutting their dividend, I am worried about the potential for earnings and dividend growth from the utility sector.  I sold (EXC) on the news of the dividend reduction and I sold (PPL) and redeployed the funds into LinnCo LLC (LNCO).

This is an update of my dividend income investing portfolio for March 1st 2013. The table below shows changes that were made to this real world dividend portfolio during the month of February 2013.

I plan to update this dividend portfolio every month.

Company / Symbol	Shares Held	Annual Dividend Per Share	Annual Income	Weighted Share Price	Yield On Cost	Total Cost Basis
Abbott Labs (ABT)	110.1973	0.56	$61.71	$10.44	5.36%	$1,150.83
AbbVie (ABBV)	110.1667	1.60	$176.27	$11.33	14.12%	$1,247.97
Archer Daniels Midland (ADM)	209.9008	0.76	$159.52	$27.50	2.76%	$5,773.18
AFLAC Inc (AFL)	83.1328	1.40	$116.39	$41.76	3.35%	$3,471.34
Apple (AAPL)	3	10.60	$31.80	$452.32	2.34%	$1,356.97
Armanino Foods of Distinction (AMNF)	1500	.048	$72.00	$0.73	6.58%	$1,093.45
Coach Inc (COH)	40	1.20	$48.00	$51.19	2.34%	$2,047.75
Conoco Phillips (COP)	87.7461	2.64	$231.65	$55.97	4.72%	$4,910.77
Cisco Systems (CSCO)	100.509	0.56	$56.29	$16.82	3.33%	$1,690.95
CSX Corporation (CSX)	337.5984	0.56	$189.06	$20.43	2.74%	$6,897.15
Dover Corporation (DOV)	50.5639	1.40	$70.79	$50.74	2.76%	$2,565.45
Darden Restaurants (DRI)	41.9307	2.00	$83.86	$40.04	4.99%	$1,678.95
Emerson Electric (EMR)	185.3525	1.64	$303.98	$46.24	3.55%	$8,570.90
General Electric (GE)	445.5972	0.76	$338.65	$16.69	4.55%	$7,437.34
Halliburton (HAL)	21.1802	0.50	$10.59	$30.06	1.66%	$636.64
Hasbro (HAS)	56.6272	1.60	$90.60	$31.00	5.16%	$1,755.31
Harris Corporation (HRS)	41.2268	1.48	$61.02	$35.44	4.18%	$1,460.95
Intel Corporation (INTC)	416.8435	0.90	$375.16	$22.66	3.97%	$9,445.33
Johnson & Johnson (JNJ)	48.5249	2.44	$118.40	$61.02	4.00%	$2,961.13
Kaydon Corporation (KDN)	102.1253	0.80	$81.70	$21.43	3.73%	$2,188.10
Kinder Morgan (KMI)	78.6282	1.48	$116.37	$34.50	4.29%	$2,712.34
Kohl's Corp (KSS)	50	1.40	$70.00	$42.24	3.31%	$2,111.90
The Coca-Cola Company (KO)	134.0262	1.12	$150.11	$33.67	3.33%	$4,512.98
Leggett & Platt Inc (LEG)	50.7001	1.16	$58.81	$18.79	6.17%	$952.60
LinnCo (LNCO)	28	2.90	$81.20	$36.94	7.85%	$1,034.31
Lockheed Martin (LMT)	32.1185	4.60	$147.75	$63.80	7.21%	$2,049.25
CapLease Inc (LSE)	200	0.30	$60.00	$5.42	5.53%	$1,084.66
Main Street Capital Corporation (MAIN)	87.3339	1.80	$157.20	$16.97	10.61%	$1,482.03
McDonald's Corporation (MCD)	98.6655	3.08	$303.89	$87.76	3.51%	$8,658.81
Medtronic Inc (MDT)	138.7894	1.04	$144.34	$31.53	3.30%	$4,376.56
MicroFinancial Incorporated (MFI)	317.353	0.24	$76.16	$6.72	3.57%	$2,132.98
McGrath RentCorp (MGRC)	105.1766	0.96	$100.97	$21.01	4.57%	$2,209.95
Miller Industries Inc (MLR)	71.7862	0.52	$37.33	$16.41	3.17%	$1,177.95
Altria Group Inc (MO)	156.0619	1.76	$274.67	$24.42	7.21%	$3,811.56
Met Pro Corporation (MPR)	259.9324	0.29	$75.38	$8.44	3.44%	$2,193.95
Microsoft (MSFT)	100	0.92	$92.00	$26.45	3.48%	$2,644.75
Mine Safety Appliance (MSA)	56.3947	1.12	$63.16	$34.50	3.25%	$1,945.88
National Retail Properties (NNN)	78.9098	1.58	$124.68	$29.30	5.39%	$2,312.40
PepsiCo Inc (PEP)	47.7967	2.27	$108.50	$57.45	3.95%	$2,745.95
Prospect Capital (PSEC)	137	1.32	$180.92	$11.48	11.51%	$1,572.12
Phillips 66 (PSX)	17.0821	1.25	$21.35	$31.83	3.93%	$543.67
QR Energy LP (QRE)	60	1.95	$117.00	$17.39	11.21%	$1,043.29
R.R. Donnelley & Sons Company (RRD)	109.8895	1.04	$114.29	$11.26	9.24%	$1,237.45
A. Schulman, Inc (SHLM)	50.7071	0.78	$39.55	$21.08	3.70%	$1,068.95
Simulations Plus Inc (SLP)	251.835	0.20	$50.37	$4.25	4.70%	$1,070.71
Senior Housing Properties (SNH)	80.4703	1.56	$125.53	$20.05	7.78%	$1,613.27
SYSCO Corporation (SYY)	111.5616	1.12	$124.95	$25.77	4.35%	$2,875.46
Tesco Plc ADR (TSCDY)	66	0.67 (Variable)	$44.22	$14.68	4.57%	$968.64
Universal Health Realty Income (UHT)	56.2205	2.48	$139.43	$32.53	7.62%	$1,828.95
Unilever Plc ADR (UL)	47.6354	1.25	$59.70	$31.32	4.00%	$1,491.99
UMH Properties Inc (UMH)	99	0.72	$71.28	$10.49	6.86%	$1,038.55
Walgreen Co (WAG)	112.057	1.10	$123.26	$31.06	3.54%	$3,480.99
Waste Management (WM)	63.961	1.46	$93.38	$28.05	5.21%	$1,793.95
Wal-Mart Stores Inc (WMT)	23.4005	1.88	$43.99	$58.73	3.20%	$1,374.23
YUM Brands (YUM)	30	1.34	$40.20	$61.36	2.18%	$1,840.85
iShares MSCI EAFE Value ETF (EFV)	134.8042	1.83 (Variable)	$246.98	$34.44	5.32%	$4,643.18
iShares DJ US Home Construction ETF (ITB)	5.05739	0.11098 (Variable)	$0.56	$35.59	0.31%	$180.00
iShares DJ US Financial Sector ETF (IYF)	4.11409	1.01 (Variable)	$4.17	$113.04	0.90%	$465.04
iShares S&P U.S. Preferred Stock Index ETF (PFF)	61.7136	2.29 (Variable)	$141.61	$30.04	7.64%	$1,853.95
PowerShares International Dividend Achievers Portfolio ETF (PID)	402.68	0.42713 (Variable)	$172.00	$12.60	3.39%	$5,072.91
Schwab International Small-Cap Equity ETF (SCHC)	281.4294	0.8106 (Variable)	$228.13	$22.02	3.68%	$6,196.94
Schwab International Equity ETF (SCHF)	137.1486	0.7238 (Variable)	$99.27	$23.31	3.11%	$3,196.64
Schwab Emerging Markets Equity ETF (SCHE)	21	0.56	$11.70	$26.18	2.13%	$549.83
Schwab U.S. Large-Cap Value ETF (SCHV)	133.8975	0.9305 (Variable)	$124.59	$22.94	4.06%	$3,071.55
Vanguard Value ETF (VTV)	78.539	1.608 (Variable)	$126.29	$35.63	4.51%	$2,798.28
Vanguard Emerging Markets Stock ETF (VWO)	80.2284	0.975 (Variable)	$78.22	$19.45	5.01%	$1,560.75
NUMBER OF HOLDINGS:			ANNUAL DIVIDEND INCOME:	MONTHLY DIVIDEND INCOME:	AVERAGE YIELD ON COST:	TOTAL COST BASIS:
66			$7,542.88	$628.57	4.36%	$172,923.41

Here is a written summary of the portfolio changes that occurred in February 2013:

Dividends Reinvested:

Abbott Labs (ABT) added 0.4373 shares ($15.37)

Abbvie Inc (ABBV) added 1.1667 shares ($43.60)

Darden Restaurants (DRI) added 0.4417 shares ($20.74)

Kinder Morgan (KMI) added 0.764 shares ($28.81)

Main Street Capital Corporation (MAIN) added 0.4059 shares ($13.04)

MicroFinancial Incorporated (MFI) added 1.4526 shares ($10.43)

McGrath RentCorp (MGRC) added 0.8207 shares ($24.52)

National Retail Properties (NNN) added 0.9092 shares ($30.81)

iShares S&P U.S. Preferred Stock Index ETF (PFF) added 0.2935 shares ($11.76)

Senior Housing Properties (SNH) added 1.2465 shares ($30.90)

Shares Bought or Sold:

Bought 3 shares Apple (AAPL) for $1,356.97 (cost basis: $452.32 share).  This purchase added $31.80 in annual dividend income to the portfolio.

Bought 38 shares Conoco Phillips (COP) for $2,215.61 (cost basis: $58.30 share).  This purchase added $100.32 in annual dividend income to the portfolio.

Sold 31.2876 shares Exelon Corporation (EXC) for $974.71 (sell price: $31.15 share).  This sell resulted in a reduction of approximately $66.95 in annual dividend income to the portfolio.

Bought 28 shares LinnCo LLC (LNCO) for $1,034.31 (cost basis: $36.94 share).  This purchase added $79.52 in annual dividend income to the portfolio.

Bought 142 shares MicroFinancial Incorporated (MFI) for $973.13 (cost basis: $6.85 share).  This purchase added $34.08 in annual dividend income to the portfolio.

Sold 34.42 shares PPL Corporation (PPL) for $1,038.12 (sell price: $30.16 share).  This sell resulted in a reduction of approximately $50.59 in annual dividend income to the portfolio.

Bought 137 shares Prospect Capital (PSEC) for $1,572.12 (cost basis: $11.48 share).  This purchase added $180.92 in annual dividend income to the portfolio.

Bought 60 shares QR Energy LP (QRE) for $1,043.29 (cost basis: $17.39 share).  This purchase added $117.00 in annual dividend income to the portfolio.

Bought 21 shares Schwab Emerging Markets Equity ETF (SCHE) for $549.83 (cost basis: $26.18 share).  This purchase added approximately $11.70 in annual dividend income to the portfolio.

Bought 1 share Schwab International Equity ETF (SCHF) for $27.67 (cost basis: $27.67 share).  This purchase added $0.72 in annual dividend income to the portfolio.

Bought 30 shares YUM Brands (YUM) for $1,840.85 (cost basis: $61.36 share).  This purchase added $40.20 in annual dividend income to the portfolio.

Dividend Increases or Decreases:

Archer Daniels Midland (ADM) increase in the quarterly dividend to $0.19 per share versus previous quarterly dividend of $0.175 per share resulting in an approximate $12.59 increase in annual income.

Exelon Corporation (EXC) decrease in the quarterly dividend to $0.31 per share versus previous quarterly dividend of $0.525 per share resulting in an approximate $26.90 decrease in annual income.  This holding was liquidated.

Halliburton (HAL) increase in the quarterly dividend to $0.125 per share versus previous quarterly dividend of $0.09 per share resulting in an approximate $2.96 increase in annual income.

Hasbro (HAS) increase in the quarterly dividend to $0.40 per share versus previous quarterly dividend of $0.36 per share resulting in an approximate $9.06 increase in annual income.

The Coca-Cola Company (KO) increase in the quarterly dividend to $0.28 per share versus previous quarterly dividend of $0.255 per share resulting in an approximate $13.40 increase in annual income.

Kohl’s Corp (KSS) increase in the quarterly dividend to $0.35 per share versus previous quarterly dividend of $0.32 per share resulting in an approximate $6.00 increase in annual income.

LinnCo LLC (LNCO) increase in the quarterly dividend to $0.725 per share versus previous quarterly dividend of $0.71 per share resulting in an approximate $1.68 increase in annual income.

McGrath RentCorp (MGRC) increase in the quarterly dividend to $0.24 per share versus previous quarterly dividend of $0.235 per share resulting in an approximate $2.10 increase in annual income.

PepsiCo Inc (PEP) increase in the quarterly dividend to $0.5675 per share versus previous quarterly dividend of $0.5375 per share resulting in an approximate $5.73 increase in annual income.

PPL Corporation (PPL) increase in the quarterly dividend to $0.3675 per share versus previous quarterly dividend of $0.36 per share resulting in an approximate $1.03 increase in annual income.  This holding was liquidated.

Wal-Mart Stores Inc (WMT) increase in the quarterly dividend to $0.47 per share versus previous quarterly dividend of $0.3975 per share resulting in an approximate $6.78 increase in annual income.

Overall Dividend Income Portfolio Results:

Annual Dividend Income as of March 1st 2013:

$7,542.88

Monthly Dividend Income as of March 1st 2013:

$628.57

Average Portfolio Yield on Cost as of March 1st 2013:

4.36%

Increase in Annual Dividend Income for the month of February 2013:

$538.04

Increase in Monthly Dividend Income for the month of February 2013:

$44.83

Increase in Total Cost Basis for the month of February 2013:

$8,480.54

The next update for this portfolio should be on April 1st, 2013.

This is where the benefit of having “dry powder”, or cash on hand comes into play.  If I had been fully invested, I would have had to pass on the opportunity to buy these solid income performers at a discount.  Keeping some cash on hand is one of the core strategies for income investing that I follow.

In other news, Kinder Morgan Inc (KMI) was the only portfolio holding to increase their quarterly dividend this month.  There were no dividend reductions.

I also decided to add 200 shares of CapLease Inc (LSE) and 99 shares of UMH Properties Inc (UMH) to the portfolio.  Many of my REIT holdings, other than National Retail Properties (NNN), are in healthcare and I want to remain diversified and own other types of real estate properties.

CapLease invests in office, warehouse and retail space.  UMH Properties owns manufactured housing communities, a manufactured housing sales operation, and a portfolio of other REIT securities. 

These two REITs appear to be more risky, and certainly don’t have the dividend paying record of UHT or NNN, however they are a very small portion of the portfolio (< 1% each), so it’s a small risk.

This is an update of my dividend income investing portfolio for February 1st 2013. The table below shows changes that were made to this real world dividend portfolio during the month of January 2013.

I plan to update this dividend portfolio every month.

Here is a written summary of the portfolio changes that occurred in January 2013:

Dividends Reinvested:

General Electric (GE) added 2.9149 shares ($65.11)

Main Street Capital Corporation (MAIN) added 0.4092 shares ($12.98)

Altria Group Inc (MO) added 2.0587 shares ($67.76)

PepsiCo Inc (PEP) added 0.3688 shares ($25.49)

iShares S&P U.S. Preferred Stock Index ETF (PFF) added 0.398 shares ($15.85)

PowerShares International Dividend Achievers Portfolio ETF (PID) added 1.7758 shares ($28.66)

PPL Corporation (PPL) added 0.42 shares ($12.24)

Schwab International Small-Cap Equity ETF (SCHC) added 7.9377 shares ($219.26)

Schwab International Equity ETF (SCHF) added 3.4917 shares ($96.03)

Schwab U.S. Large-Cap Value ETF (SCHV) added 1.2193 shares ($39.65)

A. Schulman, Inc (SHLM) added 0.3293 shares ($9.82)

Simulations Plus Inc (SLP) added 7.7351 shares ($34.17)

SYSCO Corporation (SYY) added 0.9753 shares ($30.96)

Universal Health Realty Income (UHT) added 0.6677 shares ($34.44)

Vanguard Value ETF (VTV) added 0.6358 shares ($38.17)

Dividends Not Reinvested:

AbbVie (ABBV) ($26.24) received as cash in lieu of fractional shares.

Main Street Capital Corporation (MAIN) ($30.28) special dividend.

Mine Safety Appliance (MSA) ($15.79) special dividend.

Tesco Plc ADR (TSCDY) ($14.84) minus ($1.12) ADR fee.

Shares Bought or Sold:

Received 109 shares AbbVie (ABBV) from Abbott Labs (ABT) split.

Bought 40 shares Coach Inc, (COH) for $2,047.75 (cost basis: $51.19 share).  This purchase added $48.00 in annual dividend income to the portfolio.

Bought 50 shares Kohl’s Corp (KSS) for $2,111.90 (cost basis: $42.24 share).  This purchase added $64.00 in annual dividend income to the portfolio.

Bought 200 shares CapLease Inc (LSE) for $1,084.66 (cost basis: $5.42 share).  This purchase added $60.00 in annual dividend income to the portfolio.

Bought 100 shares Microsoft (MSFT) for $2,644.75 (cost basis: $26.45 share).  This purchase added $92.00 in annual dividend income to the portfolio.

Bought 3 shares Schwab International Small-Cap Equity ETF (SCHC) for $83.61 (cost basis: $27.87 share).  This purchase added approximately $2.43 in annual dividend income to the portfolio.

Bought 99 shares UMH Properties Inc (UMH) for $1,038.55 (cost basis: $10.49 share).  This purchase added $71.28 in annual dividend income to the portfolio.

Dividend Increases or Decreases:

Kinder Morgan (KMI) increase in the quarterly dividend to $0.37 per share versus previous quarterly dividend of $0.36 per share resulting in an approximate $3.11 increase in annual income.

Overall Dividend Income Portfolio Results:

Annual Dividend Income as of February 1st 2013:

$7,004.84

Monthly Dividend Income as of February 1st 2013:

$583.74

Average Portfolio Yield on Cost as of February 1st 2013:

4.26%

Increase in Annual Dividend Income for the month of January 2013:

$364.93

Increase in Monthly Dividend Income for the month of January 2013:

$30.41

Increase in Total Cost Basis for the month of January 2013:

$8,925.19

The next update for this portfolio should be on March 1st, 2013.

I do appreciate the fact that these companies are trying to look out for their shareholders and save them some money on their taxes.  However, I also wonder how many investors will be effected by the tax increase, since it really only applies to dividends earned in a taxable account.

I’m sure it will be a bit confusing for me in trying to reconcile dividend payment months and amounts for the next couple of quarters with what I have in my very organized excel spreadsheet.  I don’t look forward to that struggle.

The drama of the fiscal cliff and the associated lackluster performance of our federal government in doing anything to resolve it, meant that the market was especially volatile this past month.  Volatility can be a good thing, especially when you have cash on hand and find dividend bargains on sale.  I used some of that cash to add more of both CSX Corporation (CSX) and General Electric (GE) to the income portfolio.

This is an update of my dividend income investing portfolio for January 1st 2013. The table below shows changes that were made to this real world dividend portfolio during the month of December 2012.

I plan to update this dividend portfolio every month.

Here is a written summary of the portfolio changes that occurred in December 2012:

Dividends Reinvested:

Archer Daniels Midland (ADM) added 1.3611 shares ($36.50)

AFLAC Inc (AFL) added 0.5491 shares ($28.90)

Conoco Phillips (COP) added 0.5697 shares ($32.46)

Cisco Systems (CSCO) added 0.6899 shares ($13.97)

CSX Corporation (CSX) added 1.654 shares ($33.03)

Dover Corporation (DOV) added 0.2728 shares ($17.60)

Emerson Electric (EMR) added 1.463 shares ($75.39)

Exelon Corporation (EXC) added 0.538 shares ($16.14)

Halliburton (HAL) added 0.0557 shares ($1.90)

Harris Corporation (HRS) added 0.3124 shares ($15.14)

Hasbro (HAS) added 0.5712 shares ($20.18)

Intel Corporation (INTC) added 4.661 shares ($92.74)

iShares MSCI EAFE Value ETF (EFV) added 1.59553 shares ($76.89)

iShares DJ US Home Construction ETF (ITB) added 0.01429 shares ($0.30)

iShares DJ US Financial Sector ETF (IYF) added 0.02382 shares ($1.45)

Johnson & Johnson (JNJ) added 0.4118 shares ($29.35)

Kaydon Corporation (KDN) added 0.8564 shares ($20.25)

The Coca-Cola Company (KO) added 0.9069 shares ($33.91)

Leggett & Platt Inc (LEG) added 0.549 shares ($14.54)

Lockheed Martin (LMT) added 0.4032 shares ($36.47)

Main Street Capital Corporation (MAIN) added 0.4403 shares ($12.91)

McDonald’s Corporation (MCD) added 0.834 shares ($75.33)

Medtronic Inc (MDT) added 0.8851 shares ($35.86)

Miller Industries Inc (MLR) added 0.6226 shares ($9.25)

Mine Safety Appliance (MSA) added 0.3947 shares ($15.68)

Met Pro Corporation (MPR) added 2.0236 shares ($18.70)

iShares S&P U.S. Preferred Stock Index ETF (PFF) added 0.2968 shares ($11.77)

Phillips 66 (PSX) added 0.0821 shares ($4.25)

R.R. Donnelley & Sons Company (RRD) added 2.9588 shares ($27.80)

Unilever Plc ADR (UL) added 0.3823 shares ($14.93)

Vanguard Emerging Markets Stock ETF (VWO) added 0.8165 shares ($35.74)

Walgreen Co (WAG) added 0.8317 shares ($30.59)

Waste Management (WM) added 0.6661 shares ($22.47)

Wal-Mart Stores Inc (WMT) added 0.1362 shares ($9.25)

Dividends Not Reinvested:

Armanino Foods of Distinction (AMNF) ($18.00)

Shares Bought or Sold:

Bought 100 shares CSX Corporation (CSX) for $2,000.65 (cost basis: $20.00 share). This purchase added $56.00 in annual dividend income to the portfolio.

Bought 100 shares General Electric (GE) for $2,058.95 (cost basis: $20.59 share). This purchase added $76.00 in annual dividend income to the portfolio.

Dividend Increases or Decreases:

Abbott Labs (ABT) increase in the quarterly dividend to $0.54 per share versus previous quarterly dividend of $0.51 per share resulting in an approximate $13.17 increase in annual income.  This increase should be in effect once Abbott splits into two separate entities in early January 2013. (Abbott and Abbvie)

General Electric (GE) increase in the quarterly dividend to $0.19 per share versus previous quarterly dividend of $0.17 per share resulting in an approximate $35.41 increase in annual income.

Phillips 66 (PSX) increase in the quarterly dividend to $0.3125 per share versus previous quarterly dividend of $0.25 per share resulting in an approximate $4.27 increase in annual income.

Universal Health Realty Income (UHT) increase in the quarterly dividend to $0.62 per share versus previous quarterly dividend of $0.615 per share resulting in an approximate $1.11 increase in annual income.

Waste Management (WM) increase in the quarterly dividend to $0.365 per share versus previous quarterly dividend of $0.355 per share resulting in an approximate $2.55 increase in annual income.

Overall Dividend Income Portfolio Results:

Annual Dividend Income as of January 1st 2013:

$6,639.91

Monthly Dividend Income as of January 1st 2013:

$553.33

Average Portfolio Yield on Cost as of January 1st 2013:

4.27%

Increase in Annual Dividend Income for the month of December 2012:

$205.82

Increase in Monthly Dividend Income for the month of December 2012:

$17.16

Increase in Total Cost Basis for the month of December 2012:

$4,041.60

The next update for this portfolio should be on February 1st, 2013.

However, as the month of November has slowly progressed, both the market and my portfolio are moving upwards once again.

What is truly awesome for dividend growth investors, like us, is that we view precipitous market drops (corrections), as an opportunity to pick up the shares of quality companies at a discount.  This month, during the downturn, I added more shares of CSX Corporation (CSX) and Altria Group Inc (MO).  Plus, I purchased a few shares of the Schwab international exchange traded funds (SCHC) and (SCHF).

As usual the annual income generated from my dividend portfolio increased, despite the drop in the price of the underlying equities.

This is an update of my dividend income investing portfolio for December 1st 2012. The table below shows changes that were made to this real world dividend portfolio during the month of November 2012.

I plan to update this dividend portfolio every month.

Here is a written summary of the portfolio changes that occurred in December 2012:

Dividends Reinvested:

Abbott Labs (ABT) added .8802 shares ($55.53)

Darden Restaurants (DRI) added .384 shares ($20.55)

Hasbro (HAS) added .546 shares ($19.98)

Kinder Morgan (KMI) added .8642 shares ($27.72)

Main Street Capital (MAIN) added .4507 shares ($12.84)

Medtronic Inc (MDT) added .8523 shares ($35.63)

McGrath RentCorp (MGRC) added .9098 shares ($24.31)

Micro Financial Inc (MFI) added 1.5384 shares ($10.34)

National Retail Properties (NNN) added 1.0006 shares ($30.42)

iShares S&P U.S. Preferred Stock Index ETF (PFF) added .3196 shares ($12.75)

A. Schulman, Inc (SHLM) added .3778 shares ($9.75)

Simulations Plus (SLP) added 2.6516 shares ($12.07)

Senior Housing Properties (SNH) added 1.3503 shares ($30.37)

SYSCO Corporation (SYY) added .9504 shares ($29.60)

Shares Bought or Sold:

Bought 54 shares Altria Group Inc (MO) for $1,670.48 (cost basis: $30.93 share).  This purchase added $95.04 in annual dividend income to the portfolio.

Bought 50 shares CSX Corporation (CSX) for $1,018.40 (cost basis: $20.37 share).  This purchase added $28.00 in annual dividend income to the portfolio.

Bought 10 shares Schwab International Small-Cap Equity ETF (SCHC) for $254.50 (cost basis: $25.45 share).  This purchase added $8.20 in annual dividend income to the portfolio.

Bought 3 shares Schwab International Equity ETF (SCHF) for $77.15 (cost basis: $25.71 share).  This purchase added $2.25 in annual dividend income to the portfolio.

Dividend Increases or Decreases:

Emerson Electric Co (EMR) increase in the quarterly dividend to $0.41 per share versus previous quarterly dividend of $0.40 per share resulting in an approximate $7.35 increase in annual income.

SYSCO Corporation (SYY) increase in the quarterly dividend to $0.28 per share versus previous quarterly dividend of $0.27 per share resulting in an approximate $4.42 increase in annual income.

Overall Dividend Income Portfolio Results:

Annual Dividend Income as of December 1st 2012:

$6,434.09

Monthly Dividend Income as of December 1st 2012:

$536.17

Average Portfolio Yield on Cost as of December 1st 2012:

4.25%

Increase in Annual Dividend Income for the month of November 2012:

$159.09

Increase in Monthly Dividend Income for the month of November 2012:

$13.25

Increase in Total Cost Basis for the month of November 2012:

$3,020.53

The next update for this portfolio should be on January 1st, 2013.

Dividend increases this month were very modest in comparison to previous months.  However, the annual dividend income generated by this portfolio continues to rise, even if the market value of the portfolio is all over the place.

This month, I finally decided to unload our remaining shares of Avon (AVP).  A quick jump in price seemed too good to pass by, and I decided to end the misery after all.  I personally foresee a dividend cut in Avon’s future.  The cash from that sale went into National Retail Properties REIT (NNN).

Additions to the portfolio this month included Kinder Morgan (KMI), Schwab International Equity ETF (SCHF), PPL Corporation (PPL), and National Retail Properties REIT (NNN).

This is an update of my dividend income investing portfolio for November 1st 2012. The table below shows changes that were made to this real world portfolio during the month of October 2012.

I plan to update this dividend portfolio every month.

Here is a written summary of the portfolio changes that occurred in October 2012:

Dividends Reinvested:

Altria Group Inc (MO) added 1.3041 shares ($43.43)

Cisco Systems Inc (CSCO) added .8016 shares ($13.86)

The Coca-Cola Company (KO) added .8763 shares ($33.69)

General Electric (GE) added 2.7179 shares ($57.79)

Kaydon Corporation (KDN) added .8918 shares ($20.08)

Leggett & Platt Inc (LEG) added .5657 shares ($14.38)

Lockheed Martin Inc (LMT) added .3355 shares ($31.38)

Main Street Capital Corporation (MAIN) added .4293 shares ($12.78)

PepsiCo Inc (PEP) added .3554 shares ($25.30)

PowerShares International Div. Achievers ETF (PID) added 1.9575 shares ($30.08)

iShares DJ US Financial Sector ETF (IYF) added .0166 shares ($0.98)

iShares DJ US Home Construction ETF (ITB) added .00309 shares ($0.06)

iShares S&P U.S. Preferred Stock Index ETF (PFF) added .3054 shares ($12.20)

Universal Health Realty (UHT) added .7214 shares ($33.72)

Vanguard Emerging Markets ETF (VWO) added .9733 shares ($41.18)

Vanguard Value ETF (VTV) added .507 shares ($30.03)

Dividends Not Reinvested:

Armanino Foods of Distinction
(AMNF) ($18.00), plus a special dividend of ($18.00).

Shares Bought or Sold:

Sold 54.949 shares Avon (AVP) for $931.87.  This sale resulted in a reduction of $50.55 in dividend income from the portfolio.

Bought 77 shares Kinder Morgan (KMI) for $2,712.34 (cost basis: $35.23 share).  This purchase added $110.88 in annual dividend income to the portfolio.

Bought 77 shares National Retail Properties REIT (NNN) for $2,312.40 (cost basis: $30.03 share).  This purchase added $121.66 in annual dividend income to the portfolio.

Bought 34 shares PPL Corporation (PPL) for $962.99 (cost basis: $28.32 share).  This purchase added $48.96 in annual dividend income to the portfolio.

Bought 49 shares Schwab International Equity ETF (SCHF) for $1,278.94 (cost basis: $26.10 share).  This purchase added $36.75 in annual dividend income to the portfolio.

Dividend Increases or Decreases:

AFLAC INC (AFL) increase in the quarterly dividend to $0.35 per share versus previous quarterly dividend of $0.33 per share resulting in an approximate $6.60 increase in annual income.

Armanino Foods of Distinction (AMNF) paid special dividend of ($18.00), resulting in a total dividend increase for the year.

Met Pro Inc (MPR) increase in the quarterly dividend to $0.0725 per share versus previous quarterly dividend of $0.071 per share resulting in an approximate $1.55 increase in annual income.

Phillips 66 (PSX) increase in the quarterly dividend to $0.25 per share versus previous quarterly dividend of $0.20 per share resulting in an approximate $3.40 increase in annual income.

A. Schulman, Inc (SHLM) increase in the quarterly dividend to $0.195 per share versus previous quarterly dividend of $0.19 per share resulting in an approximate $1.00 increase in annual income.

Senior Housing Properties Trust (SNH) increase in the quarterly dividend to $0.39 per share versus previous quarterly dividend of $0.38 per share resulting in an approximate $3.11 increase in annual income.

Overall Dividend Income Portfolio Results:

Annual Dividend Income as of November 1st 2012:

$6,275.00

Monthly Dividend Income as of November 1st 2012:

$522.92

Average Portfolio Yield on Cost as of November 1st 2012:

4.23%

Increase in Annual Dividend Income for the month of October 2012:

$300.52

Increase in Monthly Dividend Income for the month of October 2012:

$25.04

Increase in Total Cost Basis for the month of October 2012:

$6,268.96

The next update for this portfolio should be on December 1st, 2012.

I did make changes this month with the sell of part of my holdings of Abbott Labs (ABT).  Abbott had a significant run up in price prior to the upcoming spin off and I felt that it was time to harvest some of the gains for redeployment into other stocks that appear to be undervalued right now.  Part of the proceeds from the Abbott trade went into Intel Corporation (INTC) and some went into Coca Cola Company (KO).

I also attempted to do a little trading inside one of my accounts by buying shares of mining equipment company Joy Global (JOY) after a significant drop in price and then selling them for a quick profit.  My plan did work and I had a small gain, however if I would have held another week or so, I would have tripled my profit on that trade.  But, I guess hindsight is 20/20.  I moved the money from this trade into Mine Safety Appliance Co (MSA).

For me, this just proves that it’s really hard to make money by trading in and out of holdings and that my strategy of income investing is better in the long run.

This is an update of my dividend income investing portfolio for October 1st 2012. The table below shows changes that were made to this real world portfolio during the month of September 2012.

I plan to update this dividend portfolio every month.

Here is a written summary of the portfolio changes that occurred in September 2012:

Dividends Reinvested:

AFLAC INC (AFL) added .5837 shares ($27.06)

Avon Products Inc (AVP) added .8225 shares ($12.45)

Conoco Phillips (COP) added .4243 shares ($23.60)

CSX Corp (CSX) added 1.1201 shares ($25.87)

Dover Corporation (DOV) added .2911 shares ($17.50)

Emerson Electric Co (EMR) added 1.4627 shares ($72.97)

Exelon Corp (EXC) added .4481 shares ($15.91)

Halliburton Co (HAL) added .056 shares ($1.90)

Harris Corp (HRS) added .2963 shares ($15.03)

Intel Corp (INTC) added 1.0223 shares ($25.01)

iShares Preferred Stock ETF (PFF) added .3146 shares ($12.54)

Johnson & Johnson (JNJ) added .4263 shares ($29.09)

Main Street Capital (MAIN) added .4271 shares ($12.29)

McDonald’s Corp (MCD) added .7307 shares ($67.97)

Met Pro Corp (MPR) added 2.0104 shares ($18.17)

Miller Industries Inc (MLR) added .5806 shares ($9.18)

RR Donnelley (RRD) added 2.4691 shares ($27.16)

Schwab U.S. Large-Cap Value ETF (SCHV) added .8751 shares ($28.17)

Unilever PLC (UL) added .382 shares ($13.77)

Walgreen Company (WAG) added .856 shares ($30.36)

Wal Mart Stores (WMT) added .1251 shares ($9.20)

Waste Management (WM) added .6864 shares ($22.23)

Dividends Not Reinvested:

Joy Global (JOY) ($6.48)

Shares Bought or Sold:

Sold 113.0073 shares Abbott Labs (ABT) for $7,572.54 (sell price: $67.00 share).  This sell resulted in a reduction of approximately $230.53 in annual dividend income to the portfolio.

Bought 66 shares Coca Cola Company (KO) for $2,512.66 (cost basis: $38.07 share).  This purchase added $67.32 in annual dividend income to the portfolio.

Bought 13 shares Conoco Phillips (COP) for $760.87 (cost basis: $58.53 share).  This purchase added $34.32 in annual dividend income to the portfolio.

Bought 300 shares Intel Corporation (INTC) for $7,286.05 (cost basis: $24.28 share).  This purchase added $270.00 in annual dividend income to the portfolio.

Bought 56 shares Mine Safety Appliance Co (MSA) for $1,961.67 (cost basis: $35.03 share).  This purchase added $62.72 in annual dividend income to the portfolio.

Bought 1 share Schwab International Equity ETF (SCHF) for $25.94 (cost basis: $25.94 share).  This purchase added approximately $0.75 in annual income to the portfolio.

Shares Traded:

Bought 37 shares Joy Global (JOY) for $1,882.63 (cost basis $50.88 share).  Then sold 37 shares Joy Global (JOY) for $1,971.25 (cost basis $53.27 share).  Profit on this trade $88.62 capital gain + $6.48 dividend payment.

Dividend Increases or Decreases:

Armanino Foods Of Distinction (AMNF) announced a special dividend of $0.012 per share payable in October 2012.

Lockheed Martin (LMT) increase in the quarterly dividend to $1.15 per share versus previous quarterly dividend of $1.00 per share resulting in an approximate $18.82 increase in annual income.

McDonald’s Corp (MCD) increase in the quarterly dividend to $0.77 per share versus previous quarterly dividend of $0.70 per share resulting in an approximate $27.39 increase in annual income.

Overall Dividend Income Portfolio Results:

Annual Dividend Income as of October 1st 2012:

$5,974.78

Monthly Dividend Income as of October 1st 2012:

$497.90

Average Portfolio Yield on Cost as of October 1st 2012:

4.20%

Increase in Annual Dividend Income for the month of September 2012:

$241.74

Increase in Monthly Dividend Income for the month of September 2012:

$20.14

Increase in Total Cost Basis for the month of September 2012:

$3,088.62

With the announcement of QE infinity, the markets really seem to be on a tear with many investors looking for a place to earn some kind of income on their investment assets.  I believe that the lack of decent returns on cash and bonds has driven many into income producing equities, such as dividend growth stocks, in search of that income.  Only time will tell if this recent rally is sustainable, however I think it is prudent to remain cautious and hold some cash to buy on the dips and avoid overpaying for equities.

The next update for this dividend income portfolio should be on November 1st, 2012.

Unfortunately, I was compelled to eliminate my position in Hecla Mining (HL) for a small loss.  I had originally bought Hecla Mining with the thought of diversifying a piece of the portfolio into precious metals, yet still earning some dividend income from that allocation.  However, with a new focus on quality and consistency in this portfolio, the variability and uncertainty surrounding the prospects for the Hecla dividend made me liquidate this position.  I invested the proceeds from that sale into McDonalds Corp (MCD).

This is an update of my dividend income investing portfolio for September 1st 2012. The table below shows changes that were made to this real world portfolio during the month of August 2012.

I plan to update this dividend portfolio every month.

Here is a written summary of the portfolio changes that occurred in August 2012:

Dividends Reinvested:

Abbott Labs (ABT) added 1.6975 shares ($112.29)

Darden Restaurants (DRI) added .3987 shares ($20.35)

Hasbro Inc (HAS) added .5186 shares ($19.80)

Main Street Capital Corporation (MAIN) added .4424 shares ($12.23)

McGrath Rentcorp (MGRC) added 1.0345 shares ($24.07)

Microfinancial Inc (MFI) added 1.1238 shares ($10.27)

iShares S&P U.S. Preferred Stock Index ETF (PFF) added .3158 shares ($12.46)

Senior Housing Properties Trust (SNH) added 1.3181 shares ($29.09)

Simulations Plus Inc (SLP) added 2.8486 shares ($11.93)

Dividends Not Reinvested:

Coca Cola Company (KO) $4.79 cash paid in lieu of fractional shares awarded in a 2 for 1 share split.

Shares Bought or Sold:

Bought 38 shares AFLAC Inc (AFL) for $1,636.87 (cost basis: $43.07 share).  This purchase added $50.16 in annual dividend income to the portfolio.

Bought 53 shares Archer Daniels Midland (ADM) for $1,352.50 (cost basis: $25.51 share).  This purchase added $37.10 in annual dividend income to the portfolio.

Awarded 33 shares Coca Cola Company (KO) in a 2 for 1 share split.

Sold 302.1466 shares Hecla Mining (HL) for $1,393.28 (sell price: $4.61 share).  This sell resulted in a reduction of approximately $15.00 in annual dividend income to the portfolio.

Bought 37 shares Joy Global (JOY) for $1882.63 (cost basis: $50.88 share).  This purchase added $25.90 in annual dividend income to the portfolio.

Bought 75 shares McDonalds Corp (MCD) for $6,666.34 (cost basis: $88.88 share).  This purchase added $210.00 in annual dividend income to the portfolio.

Bought 1 share Schwab Intl Small Cap ETF for $23.69 (cost basis: $23.69 share).  This purchase added $0.82 in annual dividend income to the portfolio.

Dividend Increases or Decreases:

Altria Group (MO) increase in quarterly dividend to $0.44 per share versus a previous quarterly dividend of $0.41 per share resulting in an approximate $11.84 increase in annual income.

Cisco Systems (CSCO) increase in quarterly dividend to $0.14 per share versus a previous quarterly dividend of $0.08 per share resulting in an approximate $23.78 increase in annual income.

Dover Corporation (DOV) increase in quarterly dividend to $0.35 per share versus a previous quarterly dividend of $0.315 per share resulting in an approximate $7.00 increase in annual income.

Harris Corporation (HRS) increase in quarterly dividend to $0.37 per share versus a previous quarterly dividend of $0.33 per share resulting in an approximate $6.49 increase in annual dividend income.

Leggett & Platt Inc (LEG) increase in quarterly dividend to $0.29 per share versus a previous quarterly dividend of $0.28 per share resulting in an approximate $1.98 increase in annual income.

Overall Dividend Income Portfolio Results:

Annual Dividend Income as of September 1st 2012:

$5,733.04

Monthly Dividend Income as of September 1st 2012:

$477.75

Average Portfolio Yield on Cost as of September 1st 2012:

4.12%

Increase in Annual Dividend Income for the month of August 2012:

$372.35

Increase in Monthly Dividend Income for the month of August 2012:

$31.02

Increase in Total Cost Basis for the month of August 2012:

$10,051.29

I think it’s pretty easy to see the progress that this portfolio has made in only a few months of public tracking.  The great thing is that any investor can follow this pathway to dividend success by picking stocks that have a strong history of raising their dividends.  So many people think investing is hard and that they have to pay a professional for advice, but that’s simply not true and I think my dividend income portfolio demonstrates that fact.

The next update for this portfolio should be on October 1st, 2012.

My strategy this month has been to target cyclical stocks that have experienced recent declines in share price on fears of a slowing global economy.  I averaged down my cost basis and added more shares of Emerson Electric (EMR) and Kaydon Corp (KDN).  I also initiated new positions in cyclical stocks like Dover Corp (DOV) and A. Schulman (SHLM).

News of a severe drought and the possible implications for a squeeze in ethanol margins, prompted a decline in Archer Daniels Midland (ADM). Therefore I averaged down my cost basis on that position as well.

Finally, after reading an outstanding article about undervalued dividend aristocrats on Seeking Alpha by Chuck Carnevale, I decided to initiate a small starter position in AFLAC Inc. (AFL).  It looks severely undervalued, when compared to historical norms.  I normally don’t like to allocate much of the portfolio to financials and kept the position size small as a result.

This is an update of my dividend income investing portfolio for August 1st 2012. The table below shows changes that were made to this real world portfolio during the month of July 2012.

I plan to update this dividend portfolio every month.

Here is a written summary of the portfolio changes that occurred in July 2012:

Dividends Reinvested:

Altria Group Inc (MO) added 1.1242 shares ($40.01)

Cisco Systems Inc (CSCO) added .5045 shares ($7.88)

The Coca-Cola Company (KO) added .2125 shares ($16.78)

General Electric (GE) added 2.8144 shares ($57.32)

Kaydon Corporation (KDN) added .37711 shares ($8.00)

Leggett & Platt Inc (LEG) added .6553 shares ($13.70)

Main Street Capital Corporation (MAIN) added .4794 shares ($12.16)

Medtronic Inc (MDT) added .9119 shares ($35.40)

PepsiCo Inc (PEP) added .3571 shares ($25.11)

PowerShares International Div. Achievers ETF (PID) added 5.6205 shares ($82.28)

iShares S&P U.S. Preferred Stock Index ETF (PFF) added .3102 shares ($12.15)

SYSCO Corporation (SYY) added 1.0034 shares ($29.33)

Universal Health Realty (UHT) added .8005 shares ($33.23)

Vanguard Value ETF (VTV) added .5344 shares ($29.82)

Dividends Not Reinvested:

Armanino Foods of Distinction
(AMNF) ($18.00)

Tesco Plc ADR (TSCDY) ($29.79)
*reduced by ADR fee ($1.32)

Shares Bought or Sold:

Bought 60 shares Archer Daniels Midland (ADM) for $1629.55 (cost basis: $27.16 share).  This purchase added $42.00 in annual dividend income to the portfolio.

Bought 44 shares AFLAC Inc. (AFL) for $1834.47 (cost basis: $41.69 share).  This purchase added $58.08 in annual dividend income to the portfolio.

Bought 50 shares Dover Corporation (DOV) for $2565.45 (cost basis: $51.31 share).  This purchase added $63.00 in annual dividend income to the portfolio.

Bought 40 shares Emerson Electric Co (EMR) for $1815.75 (cost basis: $45.39 share).  This purchase added $64.00 in annual dividend income to the portfolio.

Bought 60 shares Kaydon Corporation (KDN) for $1228.75 (cost basis: $20.48 share).  This purchase added $48.00 in annual dividend income to the portfolio.

Bought 50 shares A. Schulman, Inc (SHLM) for $1068.95 (cost basis: $21.38 share).  This purchase added $38.00 in annual dividend income to the portfolio.

Bought 1 share Schwab Intl. Small Cap ETF (SCHC) for $24.24 (cost basis: $24.24 share).  This purchase added approximately $0.82 in annual dividend income to the portfolio.

Dividend Increases or Decreases:

None.

Overall Dividend Income Portfolio Results:

Annual Dividend Income as of August 1st 2012:

$5,360.69

Monthly Dividend Income as of August 1st 2012:

$446.72

Average Portfolio Yield on Cost as of August 1st 2012:

4.15%

Increase in Annual Dividend Income for the month of July 2012:

$327.25

Increase in Monthly Dividend Income for the month of July 2012:

$27.27

Increase in Total Cost Basis for the month of July 2012:

$10,119.37

Despite a period of market volatility, July turned out to be another awesome month of increased dividend income.  The main reason for this increase is that I was able to add a significant amount of capital to the portfolio by transferring money from a couple of poorly performing mutual funds.  

The next update for this portfolio should be on September 1st, 2012.