Recent Buy

buyFresh off ofย hearing Warren Buffett and Charlie Munger speak in person, I feel like I’ve never been more inspired or motivated to reach financial independence. I know there’s a me that exists in the future that’s already financially free, and the me of today is simply doing what’s necessary to bridge the gap between the here and now where I’m not free and the future where I am free.

As such, I decided to put some capital to work once more. We’ve just started the month, but it’s just as good a time as any to buy slivers of high-quality businesses at attractive valuations. Like Munger said at the recent Berkshire Hathaway Inc. (BRK.B) shareholders meeting, value investors never go out of style. I feel more popular than ever!

This most recent purchase involved me adding to my stake in a position I initiated last month. I felt shares were already attractively valued, but a recent slide of more than 4% from the time I initiated my stake meant it made sense to me to pick up even more stock.

I purchased 15 shares of W.P. Carey Inc. (WPC) on 5/4/15 for $64.13 per share.

Overview

W.P. Carey Inc. is a global real estate investment trust that provides services including long-term sale-leaseback and build-to-suit financing solutions.

As of December 31, 2014, the company has 219 tenants across 783 properties in 18 countries. The occupancy rate is 98.6% and the average lease term is 9.1 years.

They operate in two segments: Real Estate Ownership (71% of fiscal year 2014 revenue) and Investment Management (29%).

They were founded in 1973 but reorganized as a REIT in 2012.

Averaging Down

I analyzed WPC last month, so I won’t repeat that. However, I will discuss real quickly why I decided to pick up more shares.

I typically like to average down on a stock once it’s at least 5%ย lower than my initial purchase price. At that point, I like to nibble, open to becoming even more aggressive if the stock drops even more.

Now, that’s assuming the fundamentals haven’t materially changed and the valuation is still attractive. As I’ve discussed before, price and value are extremely important to separate from one another. And a drop in price isn’t necessarily indicative of more value, as it could be warranted due to changes in the business.

But nothing has changed here with WPC over the last few weeks. The stock market is like an ocean, with stocks acting like small boats rising and falling regularly, sometimes for no reason at all. WPC is a REIT and as such is somewhatย sensitive to interest rates. Any whisper of a change in rates could cause the price to radically oscillate. But I don’t worry about interest rates. I worry about business performance, fundamentals, quality, brands, and long-term investing. What interest rates do from here matters nil to me. Any short-term volatility here with WPC (or other high-quality REITs) due to rumors of changing interest rates or even the manifestation of changing rates would strike me as a long-term opportunity.

WPC has dropped a bit more than 4% since my purchase price, and it’s down 6.48% over the last month alone. Fine by me, as I’d prefer to buy stocks on sale. Just like I love seeing a sale on food at the grocery store, I enjoy buying stocks for less than I have to. WPC strikes me as on sale right now, so I’m eagerly buying.

I initiated my position in the company last month at $67.15, so $64.13 is even better. If it drops to $60, I’ll be interested in adding more, assuming there’s not a fundamental reason for it other than Mr. Market’s moodiness. As is stands, I increased the size of my position by 75% here.

Risks

WPCย is truly international, so they face currency risks like any other company doing business globally. In addition, they face interest rate risk in the sense that as rates rise the cost of capital increases. Though this is also true for almost every business out there that relies on some debt to conduct business and grow, this is exacerbated for REITs because of their structure.

Another risk is that 25% of WPCโ€™s leases expire within the next five years. Any issues with renewals could be problematic.

Furthermore, only 26% of their tenants are investment-grade.

Lastly, although they have substantial experience in their field dating back decades, their operating history as a REIT is rather short.

Valuation

WPC’s P/AFFO ratio is now 14.06 after the recent slide, which I think warrants attention here. Since the P/FFOย is an appropriate and useful valuation metric for REITs just like the P/E ratio is for most other stocks, one can see why a number just above 14 is attractiveย right now. Moreover, the P/B is well below the five-year average. And the current yield of 5.94% is almost 50 basis points higher than the five-year average, and obviously well above that of the broader market.

I valued shares using a dividend discount model analysis with an 8% discount rate and a 4% long-term dividend growth rate. That growth rate compares quite favorably to WPC’s ten-year dividend growth rate of 7.5%. And the payout ratio is 83.6%, which is common for REITs. All in all, I think WPC will most likely exceed 4% dividend growth for the foreseeable future, ensuring a margin of safety here. The DDM analysis gives me a fair value of $99.06, which means I have an additional margin of safety through the price I paid.

Conclusion

I’m incredibly happy with an opportunity to buy shares in WPC at this valuation and yield. As I previously mentioned, it’s quite rare to find a stock with a yield near 6% and a dividend growth rate well north of 7%. You just don’t find that kind of combination very often, especially attached to a high-quality business like WPC.

The fundamentals are excellent, the yield is very attractive, the firm is growing at a robust rate, and the diversification is outstanding. Count me as a happy shareholder. If WPC falls even more, I’d be interested in buying up additional shares if the capital is there and other opportunities don’t seem more pressing.

This purchase adds $57.15 to my annual dividend income, based on the current $0.9525 quarterly dividend.

I usually include current valuation opinions from professionalย analysts, but neither Morningstar nor S&P Capital IQ follow this stock.

I’ll update my Freedom Fund tomorrow to reflect this recent purchase.

Full Disclosure: Long WPC.

What do you think of WPC? Like the fundamentals? Think it’s attractively valued here?ย 

Thanks for reading.

Photo Credit: Stuart Miles/FreeDigitalPhotos.net

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70 Comments

  1. I picked up some WPC recently also. Glad to know I’m in good company with “the next Warren Buffet” ๐Ÿ™‚

  2. Seems to be a good buy, especially with the dip in price ๐Ÿ™‚ looking forward to reading your Freedom Fund update post!

  3. TDE,

    Ha! The next Warren Buffett’s shadow… maybe. ๐Ÿ™‚

    Glad to be a fellow shareholder here. I’m so glad I was able to grab some more shares here. A yield near 6% with the growth they’ve posted is kind of a no-brainer, in my view.

    Best regards.

  4. Glad you made it to Omaha and back Jason. I need to make it out there next year. Fortunately, my wife’s family lives a few hours south……so our trip can be a two-fer. You were talking about W.P. Carey the other day. Looks interesting on the surface. Thanks for sharing new ideas! How many holdings are in your Fund now?
    -Bryan

  5. Nicola,

    The valuation, quality, and yield are all compelling here. Just fortunate to have some capital. ๐Ÿ™‚

    I’m getting the FF update out a bit late this time due to the Omaha trip, but I should have that live fairly early tomorrow.

    Cheers!

  6. Bryan,

    Oh, that sounds like a good deal over there. I like the plan! ๐Ÿ™‚

    Yeah, the recent price action seemed to offer a good opportunity to average down just a bit on a stock that I thought was already a fairly good deal.

    The Freedom Fund now has 56 positions – all three purchases last month were new positions, while this first buy in May was an addition to an existing position. We’ll see how it goes. I’ve still got a little ammo in the BB gun for some more action this month.

    Best wishes!

  7. Great buy! I’m planning to make a purchase of WPC tonight, along with some JNJ and MUR. Fresh capital being added to my account always gets me excited, and like you I love going on stock shopping sprees.

    I’m glad you had a blast at Omaha. I was surprised to see new articles from you so soon. For some reason, I thought you were going to be away for like a week or something. At least you were able to glean some inspiration from Buffett and Munger. Hopefully this will translate into some new interesting blog topics from you as well.

    Keep up the march to financial freedom!

    Sincerely,
    ARB–Angry Retail Banker

  8. Great add. I thought it was a solid deal around 70. The valuation was a little on the fair to slightly high side, but the yield offereed great support and was right in line with the past few years at 5.4%. Today’s yield in the upper 5.x range is even better!

    Some of these REITs have just been operating very strongly for the past few years. VTR is another high quality name I’d like to get my hands around. The yield is slightly lower than I’d prefer, but the growth has made up for it. Industrials have also started to move up. I really wanted to get into DOW for a while now, but other purchases came up first. I may have to pony up a bit more than earlier this year, but it still seems to be a good value.

  9. I’ve also been nibbling on REIT’s, but will save most of my funds for future larger purchases when the market over reacts with the inevitable rate hikes. Long OHI, O, WPC, and my most interesting ARCP.

  10. More WPC – nice! I bought some a few weeks ago.

    I liked the Berkshire Hathaway trip write-up. I have been talking about going for a while now (shareholder since 2007), but still haven’t gone. Maybe 2016 is my year.

    Question for you – How do you track your portfolio / track your dividends? Spreadsheet? Software? Website? Have you written a post on this?

  11. Seems like a good buy. Any chance to average down on a company that you believe in is always a good thing I think.

  12. Nice move! I can only imagine the motivation the weekend gave you to get back to buying high quality businesses and I think you added to a great one here. I thought you’d make a move soon based on a recent comment, but didn’t know it’d be the very next day, big congrats! Excited to see what you decide on next.

  13. Great buy! WPC is definitely a great investment with a nice yield. I plan on purchasing some shares as soon I get some more capital. Thanks for sharing!
    LOMD

  14. I see in many places people talk about averaging down their purchase price and I’m not sure why you/others look at it this way. I prefer to look at my purchases when I average my yield up. I do this because when their is a dividend increase it puts a floor under the price. At a certain point your price will not fall below your initial purchase price. It’s like waiting for Coke to fall to $30 because your purchase price was $33. It is not going to get there. Now maybe I am not looking at it right but it helps me think of valuation better. If I could buy it at a %1/2 better yield I am in and work my way from there.

  15. IP,

    I’m with you. Tough to find that combination of yield and growth, especially when it’s accompanied by value and quality. ๐Ÿ™‚

    Thanks for stopping by!

    Best regards.

  16. ARB,

    Yeah, I can’t think of anything I like buying more than high-quality dividend growth stocks. ๐Ÿ™‚

    I’m actually behind a bit, which is why I’ve put out a couple articles in a row. And I’ll be updating the Freedom Fund tomorrow. A little late, but better late than never. I’m not sure I really landed any fresh ideas from the Omaha trip, but I’ve got something like 60 articles in draft mode. I need more time than ideas at this stage. I’ve got so many really great topics to discuss, but it just seems like I never have enough time to really do all I want to do. I’m way busier than I ever thought I’d be, which is really incredible and wonderful.

    Thanks for all the support. Hope you get in on WPC at an even better price than me!

    Cheers.

  17. Ravi,

    Yeah, many of the REITs I track have performed really well over the last five or ten years in terms of operations. And I think many of them have vastly outperformed the broader market in terms of total return. Not really all that surprising when you see the combination of yield and growth there, but I’m purposely conservative on the growth rate I model in there.

    We’ll see how it goes, but I think WPC should do well over the long haul. And that’s even assuming the growth rate slows markedly.

    Cheers!

  18. Wood,

    I certainly hope we see rates rise and REITs fall. I wouldn’t mind the opportunity to buy shares in some of the best REITs at an even better value. Although, I’ve been hearing that “rising rates” tune for the past two years. I can’t predict such things, so I don’t try. ๐Ÿ™‚

    Take care.

  19. sfmitch,

    I do hope you’re able to go in 2016. It was an unforgettable experience across the board.

    I’ve discussed tracking the portfolio a few times now. The article I can recall off the top of my head is this one:

    https://www.dividendmantra.com/2014/11/is-managing-a-large-dividend-growth-stock-portfolio-time-consuming/

    But my dividends are all tracked via my brokerages. And then of course I track them here on the blog as well.

    Hope that helps!

    Cheers.

  20. Tawcan,

    I’m with you. I always appreciate the opportunity to buy the same equity with the same fundamentals for a lower price. ๐Ÿ™‚

    Cheers.

  21. Ryan,

    Ha! The motivation is through the roof right now. I’m bound by capital and opportunities, but I enjoy the challenge. ๐Ÿ™‚

    We’ll see how WPC goes, but I’m pretty optimistic here. Not sure where the share price goes from here, but the business seems to be operating at a high level.

    Best regards!

  22. LOMD,

    Thanks!

    I can’t see much to dislike here. I can certainly nitpick a little here and there, but the business is overall high quality. Love the yield and the growth, that’s for sure. ๐Ÿ™‚

    Thanks for dropping by.

    Best regards.

  23. josh,

    Well, when a stock’s price is lower, the yield is higher. Price and yield are inversely correlated, so that’s just another way to look at the same thing. I would, however, caution against chasing yield. If the price drops because of a fundamental issue, then the yield will obviously be higher (assuming the dividend wasn’t cut). But that’s not necessarily a good thing. It’s important to look at a stock’s price in relation to its value and within the context of fundamentals and quality.

    As far as a stock not falling below your initial price, that sometimes happens. And as I discussed in the article linked above, it’s oftentimes a good idea to average up as the price increases over time. In fact, if you’re a long-term investor, the odds are quite good that you’ll be doing this fairly often when dealing with high-quality companies as their earnings increase and the valuations keep pace.

    Take care!

  24. I just bought WPC too at 64.25.. After your first purchase I began looking into the company and liked what I saw. I was fortunate enough to buy at a low price and hopefully this will be a winner for us for years to come.

    I still need to get a post up about it, but just been too busy!

  25. Really great article. Most people would be nothing but mad that something they just bought has gone down in price but looking at the long term it hasn’t become a stock not worth investing in. If money is made when you purchase your investment then you made even more today than a few weeks ago.

    Also the article you refer to at the start of this one (on catching up to future you) is one of the most inspirational financial articles I’ve ever read (and also the article that got me hooked on your blog)

  26. And thus the Fieber snowball of awesomeness continues to grow, haha! A solid purchase as usual; can’t wait to read about your April dividend income!

    Keep up the good work as usual!

    Cheers

  27. I bought some share of O, but come to find out the dividend is nonqualify. So I’m backing off on REIT. The second reason is, if the rate is increased, the REIT share price will go down. Then if they want to buy new property, they just create more share, so my share value get diluted. Publically traded company can also do this, but less. But REIT would do this more often. Please correct me if I’m wrong.

  28. Looks like a solid choice from a valuation standpoint. Its always good for nothing to change with the company but you get to buy it cheaper. The combination of yield and growth rate is impressive.

  29. According to Fidelity Payout ratio is 184.95%. Industry average is 111.01%. I don’t see how the dividend is sustainable. I just sold AT&T just because it ratio is 170% and it is not sustainable.

  30. ADD,

    Nice price right there. Solid move! ๐Ÿ™‚

    I think WPC will treat us well. Looking forward to seeing how the next decade or so plays out. We’ll see!

    Best regards.

  31. Tyler,

    Glad you enjoyed that article. I always think of this future version of myself, as I’m incredibly responsible for this version that exists out there years from now. I want that version to be proud of the me of today. ๐Ÿ™‚

    Some people unfortunately let Mr. Market bully them around, assuming that prices and values are one and the same. That’s really just not always or even commonly the case. I’m happy to take shares off others’ hands if/when things aren’t working out, though. Just one of those things.

    Best wishes!

  32. ZTZ,

    Can’t stop rolling that thing. It’ll one day be rolling by itself, but I’m still pushing with great enthusiasm. ๐Ÿ™‚

    Thanks for dropping by!

    Best wishes.

  33. Vivianne,

    “The second reason is, if the rate is increased, the REIT share price will go down.”

    Hmm, I’m not so sure about that. I’d be careful to just assume common assumptions are automatically true. Do you have information on how REITs perform both operationally and in terms of share prices in a rising rate environment?

    “…they just create more share, so my share value get diluted. Publically traded company can also do this, but less.”

    REITs are publicly traded companies, or we wouldn’t be able to buy shares. ๐Ÿ™‚

    I think you mean C corps? Either way, REITs issue shares because of their structure. Utilities also do this quite frequently. REITs don’t retain a lot of capital to grow due to their unique dividend/tax structure. That doesn’t mean they can’t be fantastic investments, however.

    Cheers!

  34. Hey Dividend Mantra,

    Big fan of your blog and I have learned a tremendous amount dividend stocks. Was curious to hear your thoughts on First Energy? I have owned a small amount of the stock for the past couple of years and it has a decent dividend yield, currently ~4%. Would love to hear what you think?

    Thanks,
    Dividend King

  35. As far as REITs go WPC seems to be a solid long term play with a nice yield to soften these price swoons. I understand you wanting to average down your buy price as I like to do the same with newly initiated stocks that have fallen a bit after a buy. Quite frankly, I thought I’d see a new buy in ADM but the stock has climbed a bit since you posted your stock consideration article. Thanks for sharing. WPC is looking interesting to me as well now that I joined the REIT movement with HCP, HCN and VTR.

  36. DK,

    Thanks so much. Glad you’re enjoying the blog. Means a lot to me!

    I just took a cursory look at FE. Looks like they cut their dividend pretty dramatically not too long ago and net income has been going in the wrong direction for some time now. Just not a stock that’s in my wheelhouse.

    Cheers!

  37. DH,

    WPC definitely appears to be one of the more solid REITs available when looking at the track record, dividend growth streak, fundamentals, yield, and valuation. But REITs in general have been falling a bit lately, which is starting to offer a bit more opportunity. ๐Ÿ™‚

    Thanks for stopping by!

    Cheers.

  38. Hey Jason,

    I read an article a few months ago that showed that the price of REITs will generally fall for only a few months at worst after a rise in interest rates, and then continue their steady march upward. I can’t find that particular article, but I came across a coupe others that give similar information.

    (Just look at the first chart in the document)
    http://www.altegris.com/~/media/Files/White%20Paper/ALT_WP_InterestRatesREITs_2014_04_FINAL.pdf

    http://seekingalpha.com/article/2306375-do-rising-rates-spell-doom-for-reits

  39. Josh,

    Thanks for sharing that!

    I’ve run into similar information/research over the years, which is why I was asking those questions. They were somewhat rhetorical because I think that people often automatically assume that conjecture is truth. The second article is one I’ve shared with other people here and there because I think the underlying point – rising rates spells an improving economy – is missed by many.

    Best regards.

  40. 60!? Geez, I only have 1. Then again, I have about 90 topics saved on my phone. I can’t wait to see what you come out with, and I definitely can’t wait to see your dividend income. Good luck making $7,200!

    Sincerely,
    ARB–Angry Retail Banker

  41. Good writeup, DM, as always.

    I read your article about why you prefer taxable over retirement account, but this would probably have better invested within an IRA, given its high non-qualified dividend yield. If you put it in a roth IRA, you can save a lot in taxes and still be able to withdraw your principal in 5 years if you need to. The tax difference would be even greater if sales from your new popular book propel you to a much higher tax bracket later ๐Ÿ™‚

    Also, why require only 8% discount rate, when the historic return for REITs and stocks is about 10%? If 10% is used instead, WPC is only worth $66.04, which is close to its current stock price.

  42. JTF,

    One can still earn plenty of qualified and non-qualified dividend income before paying any taxes at all. I just ran TurboTax’s TaxCaster and entered in $30k in qualified dividend income and $10k in non-qualified dividend income and the tax liability came up as $0. I’m not real concerned.

    http://turbotax.intuit.com/tax-tools/calculators/taxcaster/

    In addition, as I’ve pointed out before, even maxing out the Roth for a decade or so would still be a small overall piece of my income/wealth pie.

    As far as the discount rate, that’s a good question. I use a 10% discount rate for most stocks, especially for those with yields less than 4%. I’ve started to dial it back to 9% for yields between 4% and 5% and then use a discount rate of 8% for yields above 5%. That’s to account for the time value of money. All else equal, I’d rather have a yield of 5% and growth of 5% than a yield of 3% and growth of 7%, so I account for the time value of money in the discount rate.

    Hope that helps! ๐Ÿ™‚

    Cheers.

  43. Thanks for the explanation. The $0 tax liability assumes you have no other income though, which is probably not true for you. If you add in another $50k taxable earnings (online income for example), the same online calculator estimates $12,825 tax liability. Now, the same $50k taxable earning and $30k qualified dividend, without the $10k nonqualified dividend, would yield only $10,325 tax liability, a saving of $2,500 if the asset throwing off $10k nonqualified dividend is put into a roth IRA.

  44. JTF,

    Right. Well, I guess the question becomes will I be earning $50k in online income when I’m 40? Will I still want to write 30 or 40 articles per month? How much will I want to write after keeping at it for 12 years? A lot? Unlikely, but I think the odds are quite good that I’ll earn something. I’d be happy to hit $50k in online income now or later. In all honesty, I’d rather have a tax problem than a revenue problem. But I’m forecasting for $0 in active income just in case. Any active/online income will just be icing on the cake.

    The numbers I presented are purely hypothetical, just to show that conjecture isn’t truth. The fear over dividend taxes – even non-qualified – is sometimes misplaced or incorrect. I’ll be earning a lot less than $10k in non-qualified dividend income, as you can see based on my goal to earn $18k in dividend income by the time I’m 40 and assuming a 10% allocation to REITs. Regardless, I think the overall tax liability will be quite low. Even better, I’ll be able to show what that looks like in real-life down the road. ๐Ÿ™‚

    Cheers!

  45. I agree with most of your analysis, but not on this one. I mean, why wouldn’t you contribute to a ROTH when you can always withdraw your principal if needed with no penalty? The tax calculation you cite only works if that $30K is your only source of income. Particularly with a REIT if you make a considerable amount of other money(like blogging) – you’ll pay 28% or 35% income tax on those dividends.

  46. JayP,

    I agree the Roth is probably the most handy of them all, though I still don’t find a lot of benefit for someone in my situation.

    Sure, I could invest $5,500 in a Roth. And after a year there would have been $220 in dividends paid out (assuming a 4% yield). Assuming a 25% tax on that, you’d be looking at $55.00 in tax savings that first year. And of course that grows as the account and contributions grow. So there’s room to save a few dollars there, but I just don’t view it as particularly pressing or important. I’m leaving a few bucks on the table over the course of 12 years of investing, but I like having all of my capital and all of my income liquid and available at any given time. Some will view the few hundred dollars or thousand bucks or whatever in tax savings over the course of a decade as worth it. I just don’t. But I think I’ve already been pretty open about my views there. And I’ve also stated that most people should maximize their tax-advantaged accounts. What I do probably won’t work for most other people, unless their asset accumulation phase is quite short and they value that liquidity and income as much as I do.

    Cheers!

  47. Jason,
    I added a REIT to my holdings today, VTR. I thought I would add some diversity to the REITs in our portfolio, and VTR joins HCN, O, OHI, and WPC. I totally eliminated ARCP the other day, selling the last 20% of the shares I bought before the accounting fiasco, so VTR brings the total number of REITs back to 5.

    WPC is only down 3.7% from where I bought it. I will be adding to the holdings if prices continue to fall.

  48. KeithX,

    Nice move there!

    REITs have been weak lately, which seems to be offering an opportunity here. I didn’t plan to be particularly aggressive in the REIT space this month, but I did decide to add to one of my other REIT holdings this afternoon. I hope to get a post up about that early next week. Let’s hope this continues! ๐Ÿ™‚

    Cheers.

  49. Great analysis. Awesome buy. I plan to buy some WPC and O in my ROTH IRA account, considering the tax effect.

    Thanks for sharing.

    All the best,
    MU

  50. Your post and the comments on it were so convincing that I could not help but initiate my purchase of WPC. I bought 50 shares at $63.4. Don’t worry. It is my responsibility to accept any consequences out of my investment in WPC ๐Ÿ™‚

  51. DS,

    Hey, glad to be a fellow shareholder!

    I think we’ll do well, or else I wouldn’t have put my money there. As always, I put my money where my mouth is. ๐Ÿ™‚

    The yield, growth, and quality are all compelling here. Not sure where the stock price goes tomorrow or even next year, but I think operations should continue to impress.

    Take care!

  52. Thanks Jason, for pointing out to me WPC. . . I have been eyeing the best quality REITs on the recent drop and will act soon. I never really trusted the REITs individually, because I was not as acclimated to their structure and accounting, which is quite different than standard DGI stocks, so I had invested in VNQ a while back to get less risky exposure to the space. Now that my VNQ shares are up still roughly 25% and the premium REITs such as O, OHI, and WPC are down this month, I am going to trade out of safety into yield. Long term, I don’t think this trade can lose, and I get roughly 6% vs. 3.8% on capital and no commissions. Ca-ching!

  53. I made a sale last month. It was the last of the 5 mutual funds that my former financial advisor invested in on my behalf way back in 2006 when I opened my first IRA. Kind of an exciting time for me. Now, for the first time, every equity in my portfolio has been hand picked by me. The fund had performed well, but I feel I have educated myself to the point where it didn’t really fit for me anymore. Too much cross-over with some of the individual companies I’ve purchased the last 3 years, and knowing about the fees they were taking were driving me nuts.

    I used the proceeds to add to my stakes in O and XEL.

  54. Daniel,

    Sounds like the right move for you over there. I don’t track or know much about VNQ, but I can definitely say that WPC offers a lot to like. The yield, quality, growth, and valuation all kind of check the boxes for me, while I really love that international diversification across geographies and industries. Looking forward to seeing where WPC might be in a decade or so. ๐Ÿ™‚

    Cheers!

  55. BCS,

    I can imagine how you feel. I wouldn’t be very comfortable with paying a fee for someone else to manage a portfolio for me, either. Especially when I’m fully capable of hitting a little “buy” button by myself in order to pick up stocks.

    Have fun running things yourself 100% from here. ๐Ÿ™‚

    Best regards.

  56. REITs are getting hammered today. So I decided to add some more REITs too. At a 6% yield, solid management, long track record, dividend achiever status, WPC definitely looks appealing.

    No matter what happens in the markets, and investor expectations on interest rates, you will still get paid every quarter. And you will likely still receive an inflation beating dividend raise annually too. Hopefully prices go even lower, so that you can buy more future income cheaply.

  57. DGI,

    “No matter what happens in the markets, and investor expectations on interest rates, you will still get paid every quarter.”

    Couldn’t have said it better myself. ๐Ÿ™‚

    Enjoy that extra dividend income! I also added to OHI yesterday even though I wasn’t planning on it. But I’m always okay with changing direction on the fly, if the opportunities present themselves.

    Cheers!

  58. I think it would make sense to ask why REITS are getting hammered. Sometimes the past isnยดt a good proxy for the future ๐Ÿ˜‰

  59. Ha! That’s funny. Just read this at lunch today after having added some OHI this morning. Future me is smiling somewhere out there…

  60. investing0711,

    Well, if you know the phone number or email address to Mr. Market so as to ask him why he’s depressed about REITs, do share. Otherwise, I worry about fundamentals and business performance. I only worry about a stock price as it relates to valuation and then use any large spread to my advantage when capital and opportunity is there. The larger the spread, the more anxious I am to buy. ๐Ÿ™‚

    Cheers!

  61. GG,

    Nice move!

    I also made a small move there, just adding a few shares with a free trade I had. OHI is typically a high-yielding stock, but getting in over 6% seems prudent. The five-year average is actually higher, so we’ll see. Either way, I like the valuation quite a bit here.

    Cheers.

  62. Hi DM and all,

    Where did you guys dig the data of WPC? I searched their website, but don’t think I have enough info, such as quarterly/annually powerpoint, webcast, etc. Thanks.

    All the best,
    MU

  63. MU,

    I used the annual reports and David Fish’s CCC list. WPC’s annual reports go back to 2000, which should provide plenty of information.

    Cheers!

  64. Funnily enough, I just had some cash lying around — for 15 WPCs also.

    I mean: Nearly 6% with realisticly inbuild increases, thatยดs a pretty good investment regardless of a rate hike or “normal” interest rate environment.

    I feel pretty good now: bought dividend growth stories like ADM and EMR .. and current income machines like WPC.

    And it feels even better when I check my calendar … next payment days coming soon!

    by the way: can you recommend an application (apple or android) to “manage”/”transfer to calendar” this dividend days (payment etc.)?

    Anyway, wonderful suggestions you present here … never thought of a commission fee …. ๐Ÿ˜‰

  65. Thorsten,

    Those are some high-quality companies you’re adding to your portfolio over there. And they’re diversified across very different industries. Nice job! ๐Ÿ™‚

    I’m honestly not aware of an app that can manage/schedule your dividend payouts like that, but I have seen some other bloggers put together pretty in-depth spreadsheets that do that. I’m personally not a spreadsheet whiz nor do I have any interest in being one, so I just worry about dividend income more holistically in terms of annual income. And then, obviously, how that compares to expenses on a monthly run rate.

    Thanks for dropping by!

    Cheers.

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