As part of my process towards increasing and sharing my passive income, I post my trading activity for my dividend growth portfolios. As such, early this month on September 11th, I purchased 18 shares of Deere & Company (DE) at $81.90 per share, giving me a cost basis of $82.18 per share net of commissions.
DE is a producer of equipment and machinery in the agriculture and construction industries. In addition to producing these products, DE also provides financing services to its customers as a part of its product offerings. Primary competitors are Caterpillar (CAT), Kubota Corp (KUBTY), and AGCO Corporation (AGCO).
Fairly valued at just approximately 9.5 times trailing 12-month earnings, DE has seen some weakness in its stock price over the last six months, as seen below:
DE is a Dividend Contender, and can be found on David Fish’s CCC list, with an 11 year track mark of increasing dividends. Their 5-year dividend growth rate is 13.4%, with their latest increase being 17.6%, going from $0.51 to $0.60 per share per quarter.
Given my only industrial position is General Electric (GE), DE provides some much need diversification in this sector. DE currently pays an annual dividend of $2.40 per share, with a payout ratio of just 26.8%. My yield on cost for this purchase is a corresponding 2.92%, and increases my forward 12-month dividends by $43.20 to $1,591.24. DE pays its dividends in February, May, August and November.
What do you think about this purchase? I know many folks in the DG community have picked up shares of DE over the past few months.
I’ve updated my dividend growth portfolio page to reflect this purchase. You can see all of my dividend growth holdings on that page.