First Conviction Buy of 2016: Novo Nordisk

The first week of 2016 certainly wasn’t kind to investors, quite a lot of my shares nosedived and the total return of my portfolio is once again barely in the green. My overweight position in energy and basic materials is to blame for this as these shares are all deep in the red. Looking back, I started buying this sector way to early but hindsight is 20/20 of course.

I started 2016 by buying 35 shares of Novo Nordisk (NOVO-B), the world leader in diabetes treatment. The annual report had been laying on my desk for a couple of months but once I took a close look at this firm I was so impressed by the firm’s financial performance and growth prospects that I decided to initiate a position.

You can read my analysis about Novo Nordisk over here:

Novo Nordisk: Why I’m Buying This Diabetes Giant Despite The High P/E

 

novo_nordisk.png

Due to its low yield and the high dividend taxation, this purchase adds just 10.16EUR to my 2016 dividend income, but I anticipate the company will be able to grow its dividend at a good rate. There’s a tax treaty between Belgium and Denmark, but unfortunately this rate is not applied automatically so it’s not practical to recuperate the excess withholding tax.

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8 thoughts on “First Conviction Buy of 2016: Novo Nordisk

  1. Roadmap2Retire

    A great company and one that I would like to buy, if it werent for the dividend withholding taxes I’d have to pay for it. If it was US/UK/Can/Aus listed stock, I’d definitely buy it.

    R2R

    Liked by 1 person

    Reply
    1. Dividends Are Coming Post author

      The 27 percent dividend withholding tax is indeed a big bummer. In theory, there’s a tax treaty that lowers the rate to 15 percent but for me it’s not practical. My broker informed me they can reclaim the excess DWT for me but I need a minimum of 130EUR in recoverable taxes and they charge a 100EUR fee for this service.

      There are also several Swiss companies that I’d like to buy but unfortunately
      Switzerland is even worse with its 35 percent DWT.

      Like

      Reply
  2. Integrator@financiallyintegrated.com

    This is a great business. I bought in last year as well. Bottom drawer this one. You’ll be well rewarded in a decade.

    Like

    Reply

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