After giving you all the facts about how my dividend portfolio has done over the past 6 months, I figured it was time to update my spreadsheets to determine whether I am sticking with my 3 dividend producing stocks and the catch-all ETF.

My Current Dividend Portfolio

I took a four step approach to create my dividend portfolio.

  1. First I listed all the Dividend Aristocrats.
  2. Then I cut all those stocks whose P/E ration was either in line, equal or worse as compared to the industry standard.
  3. Next I looked at yield and
  4. Lastly, I looked at Price to Book.

I ended up with 4 stocks that I wanted to pursue,

  • LLY – Lilly (Eli) & Co
  • CTL – Centurytel Inc
  • CB – Chubb Corp
  • SWK – Stanley Black and Decker

I also picked up the Index-ETF just so I could have a small piece of all 44 Dividend Aristocrats.  So my plan is to repeat those four steps.  I will drop/add as necessary but I am going to keep investing in either 4 or 5 stocks (plus the etf).  Even if I decide not to continue investing in a certain stock, I won’t be selling my position.

Stocks on the Dividend Aristocrat List

S&P provides us with the S&P Dividend Aristocrats Index.

The S&P 500® Dividend Aristocrats index measures the performance of large cap, blue chip companies within the S&P 500 that have followed a policy of increasing dividends every year for at least 25 consecutive years.

This first step narrowed the thousands of stocks to 43.

Price to Earnings for Dividend Aristocrat List

Next I looked into comparing P/Es

Right off the bat, I eliminated those stocks in Red.  They were eliminated because I didn’t like their P/E and/or their operating margin is too small as compared to its peers.

The non-highlighted ones, didn’t grab my attention and considering I have enough ones that do, I figured I would move forward.  Speaking of those that caught my attention, they are highlighted in Blue and MUST be further researched.  If you notice their P/Es are substantially lower then their industry standard or they have an operating margin which is higher than its peers.

As you can see 3 of my 4 previous picks are still blue!  But one is red! I will stop investing in SWK.

Comparing Dividend Yield

Next up is comparing the dividend yield of all my choices which are left.  While I am not chasing yields, per se, it would be nice if the yield matched or exceeded those choices which are left.

This only eliminates one stock, BCR, with a yield less than 1%.

Price to Book

Price to Book should be near one.

This metric allowed me to eliminate 3 more choices.

My Current Dividend Producing Portfolio

  • CTL
  • CB
  • LEG
  • LLY
  • PBI
  • SDY (The ETF)

Whatcha think?