Recent Buy – AT&T (T)
It has been a while since I was able to announce I have made a buy where I am adding new capital into the portfolio. Free capital is tight and I have been working on a different goal of paying off debt and not taking on any more. But I was finally able to stash away a little bit and take advantage of this dip.
I purchased 18 shares of AT&T (T) at a cost basis of $33.09. You can find more info on T below.
Annual Dividend: $1.96
Years Paying/ Increasing: 32 years
Dividend increase from prior year: 2%
Payout Ratio: 66.9%
P/E Ratio: 15.83
There were a few reasons behind this buy. Mainly, it was a yield play which adds a lot of dividend income to my portfolio. Even though T has been increasing their dividend for over 30 years, the increments are small. Maybe 2 or 3 percent a year. I typically like higher growth dividend stocks for long term, but I think it is important to have a mix of both. Some high yield and some high growth. I don’t just chase yield around. But no one does high yield like T. Getting to almost 6% at the time of this post, it was hard to pass this opportunity up.
So the dividend income helps, but it isn’t the only reason for adding to my position. The price point was a factor as well. I have not seen T stock price this low since I originally bought it back in 2015. This buy helps me to lower my overall cost basis on this position. I have been waiting for an opportunity like this for a few years. There are a few others stocks I have my eye on right now to lower my cost basis as well, including CAH, GIS, HRL, etc. But I guess they will have to wait for another time.
As shown above, T has a dividend yield of 5.89% or $1.96 annually. This will add another $35.28 to my yearly dividend income. Broken down quarterly, it will add $8.82 per quarter. I am very happy with this purchase.
What do you think of this buy? Do you like T or do you currently own any? What other companies are on your watch list right now? Do you think the merger will go through? Comments are always welcome below.