With Royal Dutch Shell still trending down I found it too hard to resist so I pooled some fresh money together with the cash from my Baxter sale and added some more RDSB to my already overweight position.
I bought 60 shares of RDSB, at the moment I bought them they traded at an incredible 6.54% dividend yield! After taxes this purchase adds US$84.6 in annual dividend income. There’s going to be little or no dividend growth in the coming years but with such a nice entry yield I can gladly wait for things to return to normal.
A lot of my dividend income is declared in US dollars or British pounds so it’s pretty hard to make projections but at present currency exchange rates this puts my forward annualized dividend income at 953.3EUR. My short-term goal is to break the 1000EUR mark, hopefully I’ll hit it within the next two months.
While RDSB is very tempting at the moment I’m not sure if I’m going to add more in the coming months. I have a lot of faith in this mammoth company but with a weight of 19.13 percent Shell is very overweight in my smallish portfolio. And when I look at dividend income it’s even worse as Shell now accounts for just over 30% of my forward dividend income, not very healthy but the portfolio is still in its early days.
When I started dividend investing last year I pictured Shell as one of my key holdings but in the long run its weight in my portfolio has to go down a lot, especially because I already have another stock (PM) that is pretty overweight in my portfolio.
For the next purchases this year I plan to turn my attention to the consumer staples and healthcare segments. I definitely want to increase my stakes in Coca Cola (KO) and Unilever (ULVR), as well as initiate position in firms like PepsiCo (PEP), Johnson & Johnson (JNJ), AB InBev (ABI), etc.