I Added More Shares Of This Energy Company:

BP_Logo.svgIt seems like the market is setting new record highs every day, and it’s becoming challenging for me to find the right place to deploy new capital.  There are so many companies I’d love to own a part of, but I can’t justify the lofty valuations.  Luckily I’ve got a few holdings that are in the red, and in my last update I mentioned wanting to average down on IBM and BP;  I went with BP first.

BP was one of the first companies I owned as part of a Sharebuilder automatic investment in May of 2013 when I bought $400 worth at $43.44 a share.  This was a few months before I had discovered the personal finance and dividend growth investment blogging community, so it feels like forever ago!  I recently topped off that position in August of this year when the share price was $48.25;  so of course it makes sense to me to add even more now that the price has fallen even lower.

Today I added 35 shares for $41.35 each and a $6.95 commission for a total transaction cost of $1,454.20.  My yield on cost increases from 5.08% to 5.39%.  The purchase adds $84.00 to my 12 month forward dividends for a new total of $1,274.70.  I’m now on pace to average over $100 a month in passive income.  I was waiting tables before I was an editor, and on a good night I’d take home about $100.   Through investing in companies with growing dividends, I’ve essentially hired a waiter for one night a month. I can’t wait to invest more capital so he can pick up even more shifts.

Here are some Fast Graphs of BP:

2014_NOV_FG_BP

2014_NOV_FG_BP2

What do you think of BP?  What have you been buying lately?

My Dividend Growth

http://www.mydividendgrowth.com

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16 thoughts on “I Added More Shares Of This Energy Company:
  1. Dividend Mantra

    Ryan,

    Nice buy here. I think BP is a high-risk play, but it’s also got a lot of value right now. It appears to be low-hanging fruit if they can keep raising that dividend, which appears highly likely.

    I’ve thought about adding to my 80 shares myself, as it’s trading in line with my cost basis. I’m wavering. The yield and growth potential is appealing, but I might have taken on enough risk. Tough call.

    Keep up the great work. I know what you mean about waiting tables. I did that all throughout college. Brutal job!! Glad you’ve been able to hire one for a night. I’m sure you’ll be on to two nights before you know it. 🙂

    Best regards.

     
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    1. My Dividend Growth

      Jason,

      Thank you much! It seems that some of the only places to find value these days is when there is a lot of risk involved. I sometimes struggle when trying to balance that risk, but so far I’m happy with the companies I’ve picked. It sure beats some of the way overvalued non dividend paying stocks that people suggest to beginning investors. I’m lucky I’ve found you and that your strategy clicked with me almost instantly 🙂 I’d be so interested to hear your yield on cost with BP, I bet it’s been worth it to hold even through that price volatility. Crude Oil prices are weird right now, crazy that they’re the lowest they’ve been in over four years. While I can’t predict when they’ll come back up, I can sure fill my car up cheaply and collect some sweet dividends while those uncontrollable forces settle themselves! Here’s hoping neither of us will have to smell like a restaurant ever again… unless it rubs off while we’re financially independent and enjoying some fine dinning!

      Best Wishes,
      Ryan

       
      Reply
  2. DivHut

    Good call on the BP. It has been on my watchlist for some time now. I guess around $40 is a good entry point considering the risk involved with the stock. But between the great current yield and pretty much every known bad thing already baked into the stock price you should do well. Thanks for sharing this recent buy.

     
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    1. My Dividend Growth

      DivHut,

      I appreciate it! I love that BP has increased that dividend twice this year already, even if it’s smaller increases. I’m starting to feel my portfolio becoming bloated in energy though and still want to find my way into a Canadian bank or two like you’ve been doing. I’ve got one more risky, yet obvious averaging down to make in IBM, then it’s time for a new company possibly. Always great when you stop by!

      Best,
      Ryan

       
      Reply
  3. writing2reality

    Congratulations on passing the $100 per month milestone. Certainly a heck of an achievement given your short journey so far! As for BP, I owned it back in the spring of 2013, but at the time didn’t want to deal with not owning enough to reinvest the dividends since I wasn’t adding capital as regularly. At this point, I would absolutely consider reopening a position, as I agree with others that the price has already accounted for much of the risk.

     
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    1. My Dividend Growth

      W2R,

      We must have bought BP around the same time in 2013. I wish had been following your blog at that point 🙂 I’ll be curious to see if you get into this company, I like their website and the new technologies they’re getting involved in, but they sure do have tons of legal and geographical risks. It feels good to get to this point in forward dividends, but I still can’t stop thinking about how much time and capital I wasted in past years. I couldn’t be happier to finally be on the right track and have supportive friends like yourself pushing me! I always enjoy hearing from you and am cheering you on to finish the month strong!

      Take care,
      Ryan

       
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  4. roadmap2retire

    I see BP is popular amongst DGIs. Saw it getting picked up by a couple of other bloggers earlier. Congrats on adding more dividend income to your stream and a special congrats on passing the milestone of $100/month.

    Keep it up!
    R2R

     
    Reply
    1. My Dividend Growth

      R2R,

      Thank you! This milestone happened faster than I anticipated because I’ve only just started this adventure and haven’t been afraid of lower yielding investments. I saw PIP and TwoInvesting pick up more BP and rightly so in my opinion as energy has taken a big dive. I’ve got one more ultra risky investment to make in that old blue chip tech company that you suspect is dying, hehe. After that, I’m going to try to get into some more SWAN type picks. I’ve really been enjoying all your analysis lately and thanks for giving me great investment ideas! Can’t wait to see where your capital goes next 🙂

      Best wishes,
      Ryan

       
      Reply
  5. Dividends with Children

    MDG,

    I executed almost this exact purchase a couple days ago to raise my share count to 59. I’d be willing to make one more purchase in the $38-39 range to lower my cost basis to the $41 range, but that would be it considering the future uncertainty with oil and BP’s legal woes. Thankfully I’m a patient man and can ride out the rough waters for calmer seas ahead.

    Awesome waiter analogy!

    Best,
    DWC

     
    Reply
    1. My Dividend Growth

      DWC,

      I’m happy you’ve stopped in because now I’ve found your blog, it looks great and I can’t wait to follow along. Congrats on all the recent purchases and I’m hoping to join you in adding to my IBM position, as I got in much higher a few months back. Cheers to patience and a long term mindset, it’ll be very rewarding as our journey goes on.

      Wishing you the best!
      ~Ryan

       
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  6. Special Agent Dividend

    I think BP is very attrative at the moment, and I decided to nibble yesterday. While it’s not the safest among big oil, I think the current prices support buying with a great yield and good forward P/E. Good pickup Ryan!

     
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    1. My Dividend Growth

      SAD,

      I appreciate the support! Nice work in nibbling on BP, I’m excited to read about it. The yield is a monster right now, though there is a lot of risk. I’m thinking a few years down the road we’ll be mighty happy with investing at this price.

      Take it easy!
      ~Ryan

       
      Reply
  7. Dividend Growth Journey

    Nice purchase. Oil stocks has been under pressure for the past few months. I have initiated position in BP, and added to my COP position in the last couple of months. With additional holdings in CVX and KMP, I don’t think I will be adding any Oil related stocks for a while now.

     
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    1. My Dividend Growth

      DGJ,

      Thanks! COP was a nice addition for you, I’m a big fan of the company and management. I’m liking this whole sector right now as these sales continue. If CVX falls a bit below my cost basis I’ll likely add a little more, but that’ll be the last of my oil stocks for a good while unless prices really tank massively lower. Luckily, my portfolio is so new that I don’t need to worry much about weighting at this point and can pickup whatever presents the best opportunity. I’m excited to see what you pick next and hope you have a great coming weekend!

      Best,
      Ryan

       
      Reply
  8. Mr. SFZ

    Nice buy Ryan and congrats on passing the $1200 mark in forward dividends! I’ll probably be adding to BP as well here soon once I have some capital available. I think the oil sector is where the most value is right now with crude prices dropping like they have been here lately. Chevron and Exxon both look pretty good as well, but it’s hard passing up BP’s almost 6% yield even with the current risks facing the company.

     
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    1. My Dividend Growth

      Thank you, Mr. SFZ! So far this year has been way more productive than I could have ever imagined. I really want to carry this momentum into 2015 if my job situation remains stable. You’re so close to that $1200 mark yourself, I’ll be sending positive vibes that you pass that this month! Hopefully you’ll have plenty of time to add a little to BP while it’s still falling. All of these oil stocks are presenting amazing deals and in a short while, I think we’ll all be very glad we added at these levels. Excited to hear about your next purchase and cheers to finishing November with some power!

      Best wishes,
      Ryan

       
      Reply

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