As the stock market reaches new all time highs I continue investing new funds into my dividend portfolio. Some folks are hoarding cash anticipating a market crash just waiting for the right time to jump in. As much as I’d like to see stock prices come down I cannot predict the future. I don’t want cash collecting dust in my savings account with interest rates dropping more and more. My personal strategy is to just keep investing in the good times and bad.
As mentioned in my Dividend Investing Guide For Beginners from time to time I am okay paying premium valuation for premium companies. Don’t get me wrong I love buying stocks on deep discount, but sometimes one must pay up for quality. I am fairly early on in my dividend journey building my portfolio and there is certain stocks that I just want to own in my portfolio.
With that being said I decided to initiate a small starter position in Starbucks (SBUX). I know you must be thinking I’m crazy for buying into SBUX at the current valuations, but believe it or not I’m thrilled to own a very small piece of this wonderful company. I have been watching this stock for quite some time kicking myself for not buying in when it was a lot lower. After watching SBUX come down a bit of its 52 week high I decided to initiate a position.
My biggest reasoning for wanting to jump in at these valuations is quite simple I believe in and really like this business. The dividend yield leaves a bit to be desired currently a 1.94%, but with the payout ratio hovering around 50% the company has some room to grow the dividend. This is definitely a position I plan on holding for a very long time so I’m not that worried about my current yield as it should grow over time if the company continues to do well.
This is a world class company I’m very proud to own in my portfolio. Definitely a prime example of me paying up for quality. I plan to slowly continue adding to my position monthly until I reach my desired allocation. I’m hoping the stock continues to pull back some so I can buy at lower valuations, but I have no way of predicting the future so I will just continue buying either way.
Thanks for reading!
Disclosure
I am long Starbucks (SBUX)
Disclaimer
All information on this blog is solely for entertainment purposes. I am NOT a licensed professional of any kind. Any stock transactions or analysis published on this blog should NOT be considered investment recommendations. Please consult with a licensed financial/tax professional before investing any of your money or undergoing any financial/personal changes. Unless your investments are FDIC insured, they may decline in value. I will NOT be liable for any losses,damages,errors,or omissions. All information is presented as is with no warranties.
