September 2017 Investment Ideas

September is nearly over and during the exciting period of real estate purchase I nearly forgot to review my stock watch list. Even though I am not planning to buy any shares until our loan to equity ratio falls below 85% again, I will still keep a close eye on the stock market. This will hopefully help me to make better investment decisions when the time comes to buy again. Let’s see below my investment ideas of September 2017!

IBM

Dividend Yield: 3.98% vs 2.7%

P/E: 12.12 vs 12.2

Payout Ratio: 47.4%

IBM share price is slowly climbing up since the last update, but nothing significant happened. I think it is still traded at an attractive entry point, offering a safe, nearly 4% dividend yield.

 

Target

Dividend Yield: 4.11% vs 2.85%

P/E: 11.92 vs 17.26

Payout Ratio: 48.58%

Target is definitely gaining strength these weeks. Within 2 months the share price went up around 20%. It’s currently being traded at very interesting levels. There seems to be a strong resistance at $60. If the price breaks over, it could gain further strength. In case of a correction, it would provide an even more attractive entry point. I personally would wait to see which scenario will happen.

 

Brinker International

Dividend Yield: 4.28% vs 2.31%

P/E: 11.12 vs 18

Payout Ratio: 46.26%

We might finally see a turnaround here. The share price has even dipped below $30 in the beginning of September, but since then it gained nearly 10%. The Q2 earnings were not bad at all and I really don’t see a reason why the share price is still this low. If I had some extra cash to invest right now, I might buy some more shares to my portfolio.

 

Kinder Morgan

Dividend Yield: 2.59% vs 4.62%

P/E: 62.35 vs 161.9

Payout Ratio: 161.29%

This is probably in the worst shape from the list. The reason why I keep it here is the future outlook. For those who haven’t read, Kinder Morgan has announced a 3 years dividend increase plan. Based on this, next year the dividend will be increased by 60% and then 25-25% in the following two years. If all these will be realized, the share price should not begin with 1, but at least 3…

 

W.W. Grainger

Dividend Yield: 2.76% vs 1.84%

P/E: 20.76 vs 21.36

Payout Ratio: 56.72%

The share price of GWW has increased nearly 13% in September, making it less attractive comparing July, when it first got on the list. I’m not saying that this train has already gone, but I would personally wait for a correction.

 

General Mills

Dividend Yield: 3.68% vs 2.98%

P/E: 18.79 vs 21.22

Payout Ratio: 69.18%

The share price has fallen further in September, but I would still love to see General Mills in my portfolio. I really hope that the share price will stay at these levels until I will continue to buy dividend stocks.

 

L Brands

Dividend Yield: 5.61% vs 2.57%

P/E: 12.58 vs 20.13

Payout Ratio: 70.59%

L Brands has been added to the watch list in August. Since then the share price has found support around $36 and bounced 18% from those levels. The payout ratio is a little bit higher than my comfort zone and it also suggests that probably we cannot expect big dividend increases in the next few years. But hey, the stock already offers a very juicy 5.61% dividend yield. I am very interested to see where the share price will be next year.

 

How about you, dear readers? What do you think about the above selection? I’m also interested to hear what you are buying recently.

 

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Disclaimer: This post or any other information on the site is not intended to be and does not constitute financial advice or any other advice. I am solely sharing my idea, plan and progress on financial independence and early retirement.

 

 

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4 Comments

  1. Investment Hunting September 30, 2017
  2. DividendSolutions September 30, 2017
  3. Mr. Robot October 1, 2017
  4. DivHut October 14, 2017

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