Saturday, June 24, 2017

New Position: Sempra

It's been a good little while since I've added any new positions into the Dividend Scythe but this week it finally received one. For this month's investment, I opened a position in Sempra Energy. If you haven't heard of the company before, Sempra Energy is a holding company that mainly operates out of San Diego. Their current holdings include but are not limited to San Diego Gas & Electric (SDG&E), Southern California Gas Company (SoCal Gas), and Sempra South American Utilities. After reviewing their fundamentals and thinking on it for the last few months, I finally decided to pull the trigger on this addition.


Summary of Purchase:

  • Ticker: SRE
  • Price: $113.395/share
  • Shares: 16
  • Total Price: $1,821.27
  • Additional Annual Dividends: $52.64
  • New Projected Annual Income: $1,041.63 (broke the $1,000 mark!)
This price wasn't exactly what I was hoping for but it was at least a little depressed from their 52-week high of $117.97 and still at a great price point. Regardless, I have had an eye on the CEO, Debra Reed for quite some time. While the company has been under her leadership it has had great success and I expect that trend to continue upward as her personality is that of a shark. Whether it's fun or not, it looks like she is willing to do everything in her power to ensure that the stock price is protected and growing and that is exactly what I want in CEOs running my stock positions. At least as long as she is at the helm, I think I will be keeping this position open and collecting dividends (save for any surprises).

In addition to the above, the stock has a P/E ratio of 19.42x, an EPS of 5.81 and what I deem to be a relatively safe payout ratio. Currently the stock pays a dividend of $3.29 annually which at today's price equates to a 2.92% yield on cost and with an ex-dividend date of 7/5/17, I will gladly take the nearest payout to buffer my trading fee of $7. 

All in all, I'm happy with the purchase. If you or anyone you know has also been looking or have entered a position into SRE, feel free to leave a comment below. If however you disagree with this stock pick, you can kindly send me $500 via paypal at... kidding! 

Until next time, keep on keepin' on! 

64 comments:

  1. I think i may have heard the name,but done remember anyone buying,good luck with it.

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    1. It's a well known name in the San Diego name but if you're not from the area I could see how it would be a little harder to stumble upon :)

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  2. Although I have not heard this company before but your detailed information helped to have a good know-how about the company.

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    1. One thing I really try to do is to "discover" other options for dividend investors when the more normal channels are a little too contested. SRE fits right into that category.

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  3. Looks like a good one. The dividend growth is very high for a utility as well. I love utility stocks personally. They are very solid with low risk since their earnings are essentially guaranteed and rate increases provide growth which will continue over time. They are more recession proof than most other stocks as well.

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