Normally i’m planing to write about our latest stock purchases only during our quarterly Portfolio updates and not write about each and every purchase that we are doing, but I’ve decided to do it as i’m impatient to wait for end of June 🙂
So here are the transactions that we made recently:
- Sold 105 shares of Harju Electric for 4,35 EUR / share decreasing annual dividend income by -16,1 EUR (after tax) as the price of this share went trough the roof from 2,5 EUR at end of the year. The increase by almost 2 EUR was lead by almost 25 mEUR profit that Harju electric earned from buyout of previously owned Finn company PKC. That one-off profit represents 1,4 EUR / share, so if we look at 1,8 EUR increase rest 0,4 EUR was not grounded as company’s results did not improved that much. So I cut our holdings at HAE leaving with 150 shares and taking the 455 EUR (after fee) for other investments. P/E was nearing 25 so it was time to take out some cash 🙂 Purchase price was around 2,65 EUR so in the end we made +175 EUR out of this sale including fees. Not so sure what the company will do with the cash, so decided to take some of that in advance.
- Bought 15 shared of AT&T for 40,15 USD / share that cost us 563 EUR. This investment increased our annual dividend income with nice +20.6 USD (after tax) with YOC 3.4% (after tax). Majority of this investment was made from funds received from sale of part of holdings in Harju Electric. AT&T is the leading telecommunication in US with 163 bn. USD sales and only 1 real competitor – Verzon communication with annual sales of 125 bn. USD. With current share price dip its P/E dropped bellow 20 making it a bearable investment. Company has paid and increased dividends for 33 years in a row and is the highest dividend yield S&P Dividend aristocrat. High yield is on the other hand lead by high payout ratio of almost 100%. Companies balance sheet is somewhat heavy with equity level of only 31%, with minimal 6 bn USD cash reserve and quite high Financial debts of 124 bn USD making NetDebt/EBITDA x2.3, actually quite bearable (VZ x2,5). Company is expanding it’s business vertically by purchasing Time warren. I think this move is good in long run as this will definitely have some synergy of owning telecommunication network and TV content.
- Bought 160 shares of Ekspress Grupp paying 1.30 EUR / share in total costing us 210 EUR (incl. fee). This investment will generate additional +6,8 EUR (after tax) o annual dividend income with YOC 3,2% (after tax). With very attractive P/E of only 8.8 and quite strong balance sheet (Equity 69% / NetDebt/EBITDA x1.5) this company is on my list for further investments. I like that this Estonian media giant has main focus on online media (Delfi) and advertising income from there. Also a track record of slow but stable dividend increase in past few years.
So to wrap up our sales and purchases in total FAPI (Forward annual passive income) has grew by +9.4 EUR. (after tax), inching it’s way to almost 320 EUR. That makes the long term goal or our first milestone to financial independence – 500 EUR of Forvard Annual Passive Income (FAPI) 64% completed.