Most people agree that it’s hard to pursue value at this moment. The market is at all time highs. Valuations keep going higher and the sky seems to be the limit. All signs that we are approaching some kind of bubble which means that there is a serious chance for a mayor setback sooner or later. However, on the other hand nobody knows when that setback will come. Nobody even knows if it ever comes. Maybe this is the new norm or maybe we trade sideways for a couple of years.
And because the market is not a big stock market but a market of stocks there are always companies that are better buys at that moment. For example, utility stocks and REITS all lost value as of late. Mainly because the rent is increasing. So that is where I started looking for value.
Last Friday I bought shares in Realty Income. I have my eyes on this company for quite a while now. There is a reason Realty Income patented the credo “The Monthly Dividend Company”. The company pays monthly, increased the dividend nicely each year and is one of the favourites in the DGI world. I had a target of 5% dividend for a while now. Although Realty Income didn’t reach that yet I decided to initiate a starter position.
I purchased 25 shares of Realty Income (O) for a price of $ 54,02 a share. Together with my fees of $ 13,85 my cost basis is $ 54,57.
This buy adds $ 65,70 of forward dividends per year to my portfolio. After taxes that netts me $ 55,85 per year in dividends which is € 44,94 in Euro’s with the current conversion rate. My forward income excluding taxes for my portfolio is now € 505,40 per year and after taxes with the current conversion rate.
What do you think of this purchase? Do you have O in your portfolio? Don’t hesitate to comment below!