I increased my position with the purchase of more shares of International Business Machines Corporation (IBM)
20 shares @ $114.99 on 10/31/2018.
This increases my forward 12-month dividend income by $125.60 to a total of $6,836.04
I also updated my portfolio page to reflect the change.
In my last post, I mentioned how Ownes & Minor Inc. (OMI) cut its dividend which forced me to sell all my shares of the company. This is what I did with the additional capital I had after the OMI sell.
Currently, IBM pays out a dividend of $6.28 a share for the year and has estimated adjusted earnings of $13.80 for this year. This gives a dividend payout ratio of 45%. The company sports a 5-year dividend growth rate of 12.3%. The most recently dividend increase was a lot less than the 5-year average at 4.7%. It is not great, but I will take that since it currently has a high dividend yield.
I was able to pick up shares at a good price and an even great dividend yield. Even though it has run up a little since this buy, but I still think that there is valued to be had.
I find IBM to be undervalued, and I recommend it as a BUY at this time. I have a fair value price at $128.23. This means that IBM is 4.75% Undervalued Based on today’s price of $124.49 (11/28/2018).
What do you think of the company? Plan on owning it or already do? or why not?
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