Portfolio update August 2014

In August four portfolio changes were made.

One position was sold and three companies were added to the dividend machine

In order to balance out between American and European stocks I decided to buy 3 European quarterly dividend paying companies this month:

The first addition was BP or British Petroleum (ticker BP.L). After the Deepwater Horizon incident the company stopped paying dividends for 3 quarters and the stock price tanked. However since then dividend payments were resumed and they’re climbing. BP is currently cheaper than its peers due to the huge exposure of BP in Russia. Besides : oil prices are not that great lately. I think that on the long term the Ukrainian conflict will be resolved and the oil price will rise again in the future. Therefore I decided to add some BP shares to the dividend machine. I bought 200 BP shares for EUR 1.234,40 including transaction costs and the ‘Stamp Duty’. The current dividend is $0,0975 per quarter so this addition is expected to add $39 this year.

Another British Company was added this month : HSBC (ticker HSBA.L). HSBC is the world’s second largest bank with worldwide exposure. HSBC pays a quarterly dividend which is ,unfortunately, rare in Europe. 152 shares of HSBC were put into the machine at a cost of € 8,19 per share including taxes and fees.

Sold the remaining 700 shares of Imtech IM.AS). Imtech is in trouble and they don’t pay dividends, so I sold them. Something I should have done much earlier.

The last addition this month was the purchase of 45 shares of Seadrill Ltd. (ticker SDRLAD.OL). Seadrill is a drilling company which operates oil drilling equipment. The drilling sector is currently doing not so well which is likely related to the low oil price. But, in the future when oil companies start investing again Seadrill has an excellent position with its young fleet. Seadrill pays an incredible dividend of about 11% per share at the moment. Of course there are risks involved with such a dividend, but for now the looks pretty clear with a P/E of about 4 and and a well covered payout ratio.

I chose the shares listed on the Oslo stock exchange or Oslo Børs over the shares listed in New York. I thought it would be cool to have some stock listed in Norwegian Krone (NOK). I admit: not a very strong argument 🙂

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