Again time to buy has come. This time I bought 31 shares of Target @63.84. This should increase my dividend income by around $75. In fact this buy increased significantly dividend yield from my portfolio.
Why I bought Target? Well, I wrote about it recently in my post and then share price dropped even more. Valuation is low, dividend yield is decent, there are heavy buybacks. Do I believe in Target in long term?
Did I buy it for a long term?
Why is that so?
Well I think that Amazon is much better positioned. Even WMT has brighter future than Target due to bigger share of e-commerce business. I believe that Target’s business will not decline as fast as some people expect. This combined with strong buybacks should increase EPS. Valuation is low, dividend payout safe. Also keep in mind that Target has lot’s of their shops (real estate) on balance sheet. This is much safer than website
Coming back to my believing or not in Target in long term. Truth is that there were some hard times for retailers in the past. Target is almost The Dividend KING (50+ years). I do not believe that brick and mortar trade will finish. I believe that the strongest players will survive. That’s why I am long both WMT and TGT.
How about next buys?
Well, for now only Medtronic seems interesting, maybe AbbVie. Generally it is expensive and I will wait for better prices.
Disclosure: TGT, WMT – long