A new year has started and that means I have a thread for dividend related ideas. As I mentioned in OP of last year’s dividend basket thread, there is a structure centered around a set of “core” ideas. That will continue in 2025. There was a group of four core names last year. But, two of them really fizzled the second half of the year. Actually, performance wise, all four had a difficult 2024. So, 2025 starts with two carry-over names in FLNG and QCOM, and I think I will add YMAG as a third core name for now.
I don’t consider the basket a DRIP because many of the holdings in the basket are not “DRIP’d”. Or, more appropriately, the characteristics of the holdings make them “bad” candidates for DRIP. There are currently two tickers in the basket that have dividends re-invested (QCOM, QYLD). There is inclination to add more tickers with DRIP activated. A good candidate would be a late 2024 addition - Target (TGT). The company currently just meets my threshold for being included as a basket pick.
Where am I right now? Thirteen companies and three ETFs.
The three largest positions are FLNG, QCOM & YMAG (about 1/3 of the basket). In terms of sectors, the basket is slightly skewed towards shipping - half the basket (8 ticker names) is/are shipping related names.
[Edit: one could say ~50% based on original costs. But, that’s not factoring the dividends paid out. In the FLNG case, over multiple years]
In 2025, more definitively I can say a major purpose of the dividend basket is to give me a leg up in identify names of companies I would like to hold in the future to provide SOME income. I’m not looking for 50% future income at this time.
Although Atlantica Infrastructure (AY) didn’t quite work out well in the end, I would consider another play in the sub-sector - renewable energy. I mean, it is the likely space/shape of future utilities or power providers. Maybe, I tweak the concept a little, and consider a name like Equinor. But the 16 names in the basket currently provide enough of a challenge. So, part of the process in 2025 might be to identify swap candidates.
In 2024, the core ideas were mentioned, and other names were alluded to at various times in the thread. It isn’t like the rest of the names were a secret. Nobody ever asked, so I just went my merry way. Those who follow my shipping thread posts could piece most of the likely shipping names.
But, it is 2025, a new year. So this year, I share the names at the start of the year. Again, this basket is strictly dividend ideas that meet a few criteria e.g. in taxable ac, and meet a $$ threshold. If I hold the same name in the Roth ac or another ac, the value of those shares or any dividends paid are not included in this basket.
Ranked by value at the close of 2024 (12/31/24) *
1 FLNG (13.44%) 2 QCOM 3 YMAG 4 QYLD 5 GLNG 6 INSW 7 NVDY 8 WU
9 TRMD 10 LPG 11 FRO 12 BWLP 13 HAFN 14 BEN 15 CLCO 16 TGT (1.54%)
FRO and NVDY positions factor in 2025 incremental purchases.
I would think anything in this sector would be questionable. Dividends are what companies do when they can’t reasonably invest their profits in something to grow the company. If there’s a “renewable energy” company that can’t find a way to grow, then either they’re in a dead end alley or they’re not trying hard enough. Either way, this seems like a non-starter.
But then I don’t pretend to know all the ins and outs of every company in this area, so perhaps my sweeping generalization is wrong, it just seems to me to run afoul of why companies offer dividends in the first place. (OK, I know they are supposed to because: return money to shareholders. Color me cynical.)
Thanks for sharing your thoughts. I realize there are different types of “renewable energy” entities. I do think the new entities that are going directly into the sector, their focus might be growth. On the other hand, there are entities like Atlantica Infrastructure (AY) that had better backing (Canadian utility Algonquin had been a major backer), and/or better funding for most of their core assets. Nextera Energy Partners (NEP) is another such entity, albeit an LP versus AY which was a regular corporation.
01/31
January 2025 is done. Some surprises of a different flavor e.g. DeepSeek AI, Trump’s EOs, etc. The former likely impacts tech names or tech related ETFs more, so QCOM, YMAG, NVDY. The latter has the potential to hit other names in various ways. Down-the-road is the tariffs and unknown impacts across the production chain and the retail side. At this time, let me just consider them all various unknowns, generally, negative at this time.
What’s occurred in the past month?
Some adjustments, but the total names ended the same with 13 stocks and three ETFs.
Out: CLCO and LPG.
In: UPS and ZIM (counting as div pick, for now)
1 FLNG (14.33%) 2 QCOM (12.64%) 3 YMAG (9.16%) 4 QYLD 5 INSW 6 GLNG 7 WU 8 TRMD 9 NVDY 10 FRO 11 BWLP 12 BEN 13 HAFN 14 TGT 15 UPS 16 ZIM (2.20%)
NVDY somewhat tracking NVDA, had a large drop in value. But, with a second payout in Jan 2025 had the highest payout for the month.
03/01
After a flurry of shipping companies reporting on 02/27 - 02/28, somewhat playing catch-up on the shipping side. Then, there is the larger developments on the political side, and its possible affect on the market. There have been some events related to the dividend basket in the last month. Nibbled on QCOM after price pulled back. Added to YMAG -of course, two components of that ETF (NVDA, TSLA) had major developments in the past month. During the month, slashed both WU and UPS stakes, exited BEN and added to TGT. Div basket flipped to negative in a significant manner. While I did expect a lowered HAFN div, the company whiffed bad on the planned payout - 2.5c/sh, or half my lower end of 5c/sh. YTD, only two names are still black.
Feb payout was only the YieldMax names. Just based on quarterly, INSW’s first expected payout (in Mar 2025) is slightly higher than expected, FRO slightly lower. GLNG as expected and BWLP slightly better than expected (though debt has increased a lot). CLCO, with two vessels trading spot, opted for no div (Even though a major loss, Jan CLCO exit allowed me to preserve capital)