September 2018 dividend growth update

“As it starts getting colder, the September 2018 dividend growth shows no signs of cooling down”

When we started our journey, we were expecting some gains and some loses. What a blunder from our side. September 2017 versus September 2018 dividend growth comparisons show an 85% gain! We will try to keep this up for our September 2019 dividend growth update as we think a strong foundation has been created. Our shares from 2017 showed good growth and we added a couple of new shares that we believe are long-term growth companies with a broad moat (A reference to Mr. Buffett’s moat definition of a business’ ability to maintain it’s competitive edge, click for more information). Here’s the breakdown to our September 2018 dividend growth achievement.

Your Diagram Title2018 September → 2018:
599.05
2018 → RDSA:
256.80
RDSA → 2017:
246.87
2018 → RIO:
90.46
2018 → LVS:
50.11
2018 → O:
48.76
2018 → UNA:
46.80
2018 → DLG:
31.52
UNA → 2017:
29.16
DRG.UN → 2017:
25.90
2018 → DRG.UN:
25.85
O → 2017:
16.29
2018 → MSFT:
15.96
MSFT → 2017:
5.04
2018 → SIX:
3.41
2018 September:
599.05
2018 September: 599.05
2018:
599.05
2018: 599.05
DLG:
31.52
DLG: 31.52
LVS:
50.11
LVS: 50.11
DRG.UN:
25.90
DRG.UN: 25.90
SIX:
3.41
SIX: 3.41
RIO:
90.46
RIO: 90.46
MSFT:
15.96
MSFT: 15.96
2017:
323.26
2017: 323.26
RDSA:
256.80
RDSA: 256.80
O:
48.76
O: 48.76
UNA:
46.80
UNA: 46.80

Dividend already owned in September 2017

Royal Dutch Shell (RDSA)

There are a number of shares we regret not buying earlier, we mentioned some in our August 2018 Dividend growth update. Royal Dutch Shell (RDSA) is definitely one of the top contenders. The current oil price is very high at the moment and RDSA is definitely benefiting, but not depending on it. It has significantly reduced their cost basis as well as diversified into gas. A combination of number of shares growth (642 in 2018 vs 633 in 2017) and dividend payment (€0.40 in 2018 vs €0.39 in 2017) resulted in 4% increase year on year. It represented 43% of our dividend payout this month.

Unilever (UNA)

Unilever is a company with a tremendous diverse and global reach, that we do not expect it to crumble in the very near future. The 60% September 2018 dividend growth compared to 2017, was mainly based on growing our shares total from 81 to 120 shares.

Realty Income (O)

As a monthly dividend payer, we will just refer to our previous month update. Let’s see if October provides a dividend increase.

Dream Global REIT (DRG.UN)

As with the other monthly dividend payer in our portfolio, no significant change compared to August 2018 dividend update.

Microsoft (MSFT)

As blunders go, back in 2009, we underestimated the power of long-term investment. We had a significant amount of shares, and decided to sell them off because we felt it wasn’t a stable investment. The short term noises distorted our long-term views. We are slowly building our position back up, going from 15 shares in 2017 to 38 in 2018. The dividend payment increased as well, which is always welcomed. We will definitely not make the same blunder again.

Dividend new for September 2018

Las Vegas Sands (LVS)

On of the mistakes that Mr. Blunders has made in the past, is enjoying gambling and the lights of Las Vegas a bit too much. And Las Vegas Sands (LVS) specialized in luring people in. It might be struggling from a share price decline, but as we see it, it allows us to buy more! We had no shares in September 2018, therefore our 2018 September dividend growth comparison doesn’t really work. We do look forward to seeing how the comparison will be in September 2019.

Six Flags Entertainment (SIX)

Sometimes inspiration comes from the strangers places. Another family was sharing with us recent experience visiting a Six Flags amusement park and how much they enjoyed it. At night we became curious (remember our post about not stopping to be curious!) and read up on Wikipedia first about Six Flags. We had no idea what they went through. After checking their current financials and performance, we believed that they are in a far better place and have learned from their mistake. A small position was created (50 shares) and will be monitored closely.

Direct Line Insurance (DLG)

Given the scorching heat this summer in the UK, we were having some doubts about Direct Line Insurance (DLG) and how it would affect them. Then we realized that we were about the make the same blunder as we mentioned a couple of times before, we aspire to be long term investors and not short term. DLG is specialized in insurance and therefore has risk mitigation measure to address any kind of calamity (heat, cold, rain, hail, etc..). Depending on how their annual report is, we may see a share price decline as an opportunity to buy more in the future.

Rio Tinto (RIO)

A blunder many people have warned for, is under diversification. We took a look at our portfolio and wanted to diversify in 2 direction, geography and industry. We looked around and assessed Rio Tinto (RIO) as a company that would fulfill these criteria. It has global operations, is headquartered in Australia (we bought the AUD share to diversify exchange rate risks) and is in an industry that we do not have represented yet, mining. Some of our companies depend on metals/minerals to operate and therefore we believe it will be a good hedge should there raw materials go up or down in price.

Dividend discontinued before September 2018

None

We feel very proud of ourselves that for the first time there are no companies that have left our portfolio. Does it reflect that we bought the right companies as a strong foundation? Maybe. We’re we lucky this past year? Maybe. Does it provide us with more confidence to maintain our strategy of long-term investors? Certainly.

Total September 2018: €599.05 vs €323.26 September 2017

A month that made us feel very proud, as nearly €600 was paid out to us without having to lift a finger. The September 2018 dividend growth rate of 85% has been moment of joy for us and we look forward to what October 2018 dividend growth will bring us.

Anything that you experience in September 2018 that will prevent you from making future blunders?

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