After my Amgen and Delta buys in January it is time to shift my attention to new buys for February. There are currently three candidates on my watchlist: Johnson & Johnson, Qualcomm and VF Corporation. In this post I go over these three candidates and set out my reasons for why they are on the watchlist - and make my trigger finger itchy!
Johnson & Johnson (JNJ) researches and develops, manufactures, and sells various products in the health care field worldwide. It operates through three segments: Consumer, Pharmaceutical, and Medical Devices.
The company is a favorite among dividend growth investors and with good reason: JNJ is a dividend champion with 54 years of raising dividends. It’s current yield is a decent 2.82% with a payout ratio of 54%.
I already hold 12 shares of JNJ in my portfolio but would like to add more. Apart from it’s attractive dividend features the current PE ratio is 19.12 versus a 5 year historic average of 19.40. Taking PE as a measure this means that I am interested in adding more JNJ when the price is below 115.
Second on my list is Qualcomm Inc. (QCOM). This company develops, designs, manufactures, and markets digital communications products and services in China, South Korea, Taiwan, the United States, and internationally. The company operates through three segments: Qualcomm CDMA Technologies (QCT); Qualcomm Technology Licensing (QTL); and Qualcomm Strategic Initiatives (QSI).
Qualcomm is a dividend contender, boasting 14 years of dividend increases. The current yield is a very appealing 4.01% with a payout of 65%.
My original purchase of Qualcomm dates back to November of 2015. Since then the shares enjoyed a rally to ~70 USD. More recently the stock showed a sharp decline due to several competition and patent issues. The current PE is 16.12, below it’s historic 5 year average of 18.18. The relatively low PE plus the great 4+% dividend raises my interest in adding more Qualcomm in the near future.
The final candidate on my February watchlist is VF Corporation (VFC). The company engages in the design, production, procurement, marketing, and distribution of branded lifestyle apparel, footwear, and related products in the United States and Europe. Famous brands include The North Face, Vans, Timberland, Kipling, Napapijri, Jansport, Reef, Smartwool, Eastpak, lucy, and Eagle Creek brands. It also provides denim, casual apparel, footwear, and accessories under the Wrangler, Lee, Lee Casuals, Riders by Lee, Rustler, Timber Creek by Wrangler, and Rock & Republic brands.
Retail - recently labeled as ‘uninvestable’ by a Wells Fargo analyst - is not the most popular investment category right now. Keeping with the trend, VFC’s price has pretty much collapsed in the past year. However, just by looking at the dry facts of VF Corporation there remains a lot to be liked.
The company is a dividend champion with 44 year of raising dividends. The Greensboro, NC clothing behemoth has been around since 1899 and has thus weathered some storms before. Due to it’s price decrease the current yield is at a very decent 3.42% with a payout ratio of 59%. VF Corporation’s PE is 17.10, way below it’s 5 year historic average of 21.83.
What do you think about these three companies? What is your watchlist for the month? Leave a comment/reply to share your thoughts!