Thursday, 26 May 2016

Recent Buy! April 2016


    Following up on my Watchlist post, I went ahead and added to my position in Algonquin Power and Utilities (AQN). I have held shares in this company since first starting my portfolio, by year end it will be 3 years! I still consider this stock as a long-term hold, and is the largest single holding in my portfolio, with a weighting of 14.87%. Which is from adding more shares and the stocks steady appreciation in value over time.

  I picked up these shares in late April, buying 94 shares at $10.68, with a dividend yield of 5.24%. The dividend is roughly CAD$.14 per share after the foreign exchange conversion from its US Dollar dividend. So these 94 new shares add roughly $13.16 per quarter, and $52.64 per year in dividend income for me. And has the possibility of swinging either higher or lower depending on the FX rate of the day.   

     Since buying the shares, AQN reported a decent first quarter financial results and boosted its dividend by 10%. With the annual dividend payout going from US$0.385, to US$0.4235 per common share. Which is an excellent piece of news. The stock is now also trading at $11.44, looks like I lucked out some on that end. Shares are still trading at a Price/Earnings ratio of 28.14, so a bit high, but is also yielding 4.76% despite the shares value increase due to the dividend raise.

    I now have a total of 464 shares of AQN with a new average share cost of $9.02, from the previous 370 shares at a price of $8.6.

    Overall I really like this company for a few reasons:
- A solid portfolio of renewable energy generation and Utilities.
- Consistent growth of the business.
- The steady and sustainable dividend increases.
- Relatively low volatility for the size of the company (3billion market capitalization).

    Those are just a few of the reasons why I like the company so much, not to mention that it is also my best performing stock pick by a wide margin, with a 25% return! It is also the stock that I nominated for a 2016 Top Investment Picks done by fellow blogger RoadMapToRetire.

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