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 Strategies & Market Trends : Dividend investing for retirement

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To: Ditchdigger who wrote (11401)3/31/2012 11:39:06 AM
From: E_K_SRead Replies (2) of 16024
 
Hi Ditch-

Hope you had a nice vacation. I have been a net seller of my drug stocks as many of the companies I monitor are selling at the high end of their value range (at least for me). Based on the current prices I was too early peeling off shares as most of them are selling at higher prices.

Here is a list of my recent sales:

LLY	8/2011	$37.50	 closed out position in taxable account $40.27 (Current Price)	4.95% dividend yield
MRK	2/2012	$38.55	 peeled off shares in taxable account   $38.40                  4.4% dividend yield
GSK	11/2011	$43.00   closed out position in taxable account $44.91	                5.0% dividend yield
COV	7/2011  $52.51   closed out position in taxable account $54.59                  1.7% dividend yield
PFE	2/2012  $21.15	 peeled off shares in taxable account   $22.65                  3.9% dividend yield
BMY	2/2011	$25.35	 peeled off shares in IRA account       $33.75	                4.1% yield	
MPW	10/2010 $10.00	 closed out position in taxable account $9.28                   8.66% dividend yield

Recent Buys:

ABT	2/2011	$45.20	New position in Taxable account $61.29	 3.3% dividend yield
NSRGY   6/2011	$62.07	New position in taxable account $63.00   2.9% dividend yield 
MPW     6/2010	$8.54	Added position in IRA           $9.28	 8.7% dividend yield 
(Note: Medical related-REIT Medical Facilities)

Current Drug/Pharmaceutical and/or Medical related positions

Taxable Account: 4.8%   of Portfolio
IRA Account:      14%   of Portfolio
All accounts:     6%    of all equity Portfolios 
(Note: PFE is largest holding in IRA ranked No 3 w/ BMY rank No. 10;  PFE ranks No. 10 in Taxable, followed by MRK No. 13)
---------------------------------------------------------------------------

MRK	 Taxable	 current yield 4.42%
MRK	 IRA
PFE	 Taxable	 current yield 3.93%
PFE	 IRA
ABT      Taxable         current yield 3.35%
NSRGY    Taxable         current yield 1.78%
BMY	 IRA             current yield 4.05%
MPW	 IRA             current yield 8.66%


So, your GlaxoSmithKline plc (GSK) pick at $44.91 may be a good one to add as it has not really moved higher like the other drug companies since my sell in 11/2011. The No Foreign tax is also attractive especially if shares are held in a taxable account. Their forward PE is a bit higher than the other drug companies at 11.91 but their 5% dividend yield is a bit higher than the group average. Their debt profile is in my acceptable range w/ LT debt less than 4x annual net income. Buffet still holds a large position in GSK . He owns JnJ & SNY too. BAYER AKTIENGES ADS (BAYR.pk) yielding 3% at the current price, is one I have had on my buy list for some time but I missed picking up shares in the $50.00 price range.

These are the stocks on my Drug and Pharma Buy list that I will be looking at on any significant market correction: goo.gl 

I probably should increase my Drug/Pharma holdings in the taxable account and could reduce my position(s) in the IRA if/when some of the positions become over valued. My target is to have at least 10% of the total portfolio(s) in some type of Drug/Pharma holdings w/ a net dividend payout of between 4%-5%. In hindsight, that gift buy on ABT (that Steve Felix alerted the board too) was a very good pick up. I needed to buy more.
Hope that helps.

EKS
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