I have written frequently about how a combination of MFI stocks that have at least a 2.6% dividend yield have vastly outperformed everything since 2006. With my open tracking portfolios, this continues to be the trend. They are winning 9 of the 12 open portfolios versus the Russell 3000 and they are winning 10 of 12 against the broader MFI.PETS was the most recent dividend stock to shoot up, over a 10% pop post solid earnings that saw revenues (finally) increase (PetMed Express beats by $0.03, beats on revs).
September 30th MFI Dividend Portfolio
I thought readers might like to see how a dividend portfolio is performing. Here is a listing of September 30th, that is up a composite 24%, despite a dismal CHKE:
| Stock | Initial Price | End Price | Percent Change | Mkt Cap |
| STRA | 75.85 | 116.62 | 54% | 935 |
| MDP | 22.32 | 32.48 | 46% | 1,041 |
| PETS | 8.89 | 12.62 | 42% | 195 |
| KLAC | 38.00 | 51.26 | 35% | 6,523 |
| HRB | 13.13 | 16.87 | 28% | 4,198 |
| DLX | 18.39 | 23.42 | 27% | 995 |
| LPS | 13.61 | 16.56 | 22% | 1,205 |
| AMAT | 10.29 | 12.31 | 20% | 13,992 |
| MSFT | 24.70 | 29.34 | 19% | 213,169 |
| PDLI | 5.42 | 6.36 | 17% | 807 |
| CMTL | 27.59 | 30.50 | 11% | 684 |
| USMO | 12.97 | 14.22 | 10% | 303 |
| CHKE | 12.64 | 10.42 | -18% | 112 |
Of course, one of the ironies about the MFI Dividend stocks is that while I would humbly suggest I am the person that has highlighted the out-performance, I personally have not benefited. Why is that?
I have been buying MFI dividend stocks for the past two or three years. Sadly, the ones I have picked have generally underperformed.
CHKE - poor
UNTD - poor
MNDO - poor
CEL - poor
PETS - poor
RTN - ok
MSFT - ok
CMTL - ok
INTC - good
PM - good
RAI - good
STRA - good
RGR - good
What does this mean? I'd humbly suggest it means I am a lousy stock picker.
What should I do? I am tempted to get back into MFI, but purely on the dividend side and purely mechanically. I have mentioned that I will be obtaining some funds at the end of February. Perhaps I will simply make a listing of MFI stocks at the end of February that qualify as dividend stocks and buy a basket.If I were to do it today, these are the stocks I would buy:
| NOC |
| GNI |
| PDLI |
| UNTD |
| USMO |
| DLX |
| HRB |
| RTN |
| MSFT |
I would definitely have to hold my nose on a couple of these. But that is why they call it mechanical. We'll see.
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2 comments:
Any thoughts on also looking at market cap? Using your list, which is obviously am extremely small sample set, the 4 with the worst returns are in the bottom 5 in market cap. The reason I am mentioning this is I have seen something similar in my extremely small data set, small caps with decent dividends do not seem to performed as well.
AD - I have seen the same thing - small divvy stocks seem to lag. Not sure why, I guess their cash flow is less certain.
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