2009 net worth results

Well, with 2009 becoming a distant memory it's time to look back at how net worth held up here and with our usual suspects.

First off our net worth rose about 33% for 2009 calendar. That sounds much better than it truly is though, as our net worth was actually at a higher level in May of 2008 than it was in March of 2009. A milestone for 2010 would be to see our house value get to the point where it makes up 50% of our total assets. It currently sits at about 62%.

The Maritime Super-Blogger, at Million Dollar Journey posted a 29% increase in net worth over 2009 reaching the $400,000 mark. The 30 year old is 40% of the way to his goal of a $1,000,000 net worth by age 35.

Tim at Canadian Dream increased his net worth by 39% in 2009. During the year he focused on building his market investments. His net worth stands at $304,500.

If any other bloggers have calculated their net worth increase for 2009 please drop me a comment with your results or a link to your blog, and I will post your results with a link in a follow up post to this one.

climbing the ladder

Canada's, The Globe and Mail published an article recently called Financial Tips As You Climb The Financial Ladder. It was written by Larry MacDonald and it offers some financial advice for those in their 30's and 40's.

Many of my favourite financial blogs are actually mentioned in the article including Triaging My Way To Financial Success, The Dividend Guy, Michael James on Money, and Thicken My Wallet.

the moneygardener was also called out in #7 for the dividend hound that I am...

You are in your thirties or forties, moving up to higher levels of income in your career. Your children are growing up and you are making good progress paying down liabilities such as the mortgage. Overall, it's becoming easier to put money aside and invest for future needs, particularly retirement. Here are 10 financial tips to consider for this stage of life.

top 6 consumer goods stocks for 2010

I don't normally do this but I can't help linking to this article by TheStreet.com. The Street is touting 6 names as the Top 6 Consumer Goods Stocks for 2010, and by George I own 4 of them.

Scotts Miracle Gro (SMG)
Clorox (CLX)
Procter & Gamble (PG)
Phillip Morris (PM)
Johnson & Johnson (JNJ)
Pepsico (PEP)

The article does provide some good insight into the expected fortunes of these six firms as they move into 2010. With the exception of SMG they are all great dividend raisers as well. I agree that these are 6 very good companies to own shares in for the long term, especially if they can be acquired at reasonable value.

got Husky-er

No, I didn't eat too much fruitcake and apple pie this holiday season, I just bought myself a gift on Christmas Eve in the form of 52 more shares of Canadian oil and gas firm Husky Energy (HSE) at $29.63/share. I've been looking to boost my portfolio exposure to oil and gas and after looking at a few option,s I came back to Husky for reasons not limited to the following:

• After Husky shares had fallen from a high of around $52 in 2008 and the company's cut their dividend, they haven't bounced back as much as I expected given the rebound in oil prices. I now don't see a lot of downside for the shares as they price of oil feels firm now that the economy is out of the hole it was in.
• The stock has also underperformed many other oil and gas stocks and the valuation seems reasonable at just $4 above it's multi-year low
• I think Husky will be quick to raise their dividend back up once their earnings catch up to the price of oil. Husky is now paying $1.20/share in dividends, while their EPS in strong-oil years past has been in the $4-$5.50 range. I think we have some high-oil price years ahead of us...
• The current yield of 4% offers some in pocket return with little risk of downside to the share price as the great recession moves further into history

Husky now makes up 7.4% of our non-registered portfolio.

Happy Holidays!

Wishing you the best of the season from the moneygardener, and a successful 2010!

2009 Was A Great Year to Be A Stock Market Investor!

• While cowards fell by the wayside, the S&P 500 index has risen 24% for the year and has nearly doubled since the March low
• Some of the equities that we own are trading at or near their all time highs
• Leveraged investments into the heart of the late 2008 / early 2009 plunges have been paying mostly stable dividends and interest rates have remained low
• All signs are pointing to an improvement in dividend growth in line with general economic activity
• Our net worth has exploded over 30% while we've been doing a poor job of saving money
• All financial media outlets are preaching caution with your money, your mortgage, and your life.......the most bullish sign yet!

Australian Red Wine Roundup (moneygardener recommends)

• Wolfblass Red Label Cabernet Merlot 2008
• Rosemount Shiraz Cabernet 2008

Leon's purchase

Today I purchased a chunk of Canadian furniture chain Leon's (LNF). The stock is so illiquid that I could see my 170 share purchase add to the running total for the day and I saw a chart blip with my name on it on Google Finance. I bought the shares at $9.88 and I will get the $0.20 per share special dividend that Leon's is paying out in December. I have to admit that I have been looking at the stock for a few years and I was surprised to see the valuation it has changed hands at in the last few months. The special dividend did catch my attention but I do think the shares are good value at 12.5x depressed earnings. Several retail stocks with inferior balance sheets to Leon's have much higher multiples in hopes of recovery. I think Leon's stock has room to run and management has navigated through tough times before.

I will be holding for the long term, with these as my primary reasons for purchase:

• 'Go to' name in Canadian furniture & appliances with large, well located, and well laid out new stores
• Always generate return on equity north of 15% and very low debt level
• Yielding 2.8% and have a solid history of dividend growth
• Conservative, family run, shareholder friendly business with room to grow with potential expansion in under-serviced markets in Western Canada

This now makes up 2.2% of my portfolio.

Sysco, Intel, Leon's dividend news

Food distribution powerhouse SYSCO (SYY) has raised it's dividend by 4% to $0.25 per share. This marks SYSCO's 160th quarterly dividend. As far as I can see SYSCO has raised their regular dividend every year since I was born in 1979.

I recently bolstered my position in SYSCO on June 15 of this year when the stock traded at $22.82. The stock now trades at $27.35 and yields 3.7%.

Another notable dividend raise came from chip maker Intel (INTC) who raised their dividend by 12.5% on November 16. That stock now yields 3.1%.

Leon's Furniture (LNF) issued a special dividend of $0.20 per share to celebrate their 100th year of business. Congrats to Leon's shareholders. I wish I had purchased Leon's during the downturn when it traded at $8.00, as I believe that it is a great Canadian business. The stock is trading at $10 per share with a yield of 2.80, a P/E of 12.5 and a debt/equity ratio of only 0.36. Sales and earnings have been down pretty significantly lately due to their sensitivity to the downturn.

net worth update, Nov 09

It's time to report my bimonthly net worth. I report my net worth on the moneygardener or around the 15th of May, July, September, November, January, and March.

Net worth results for the 2 Months Ended November 15, 2009:

• Debt/Asset ratio dropped to 0.47 from 0.48 (record low)

This is a measure of our financial health. Total debts divided by total assets. So currently for every $1 of assets that we have, we have $0.47 of debt. Back in May of 2006 our debt/asset ratio was a whopping 0.77. What is your debt/asset ratio?

• Net Worth gained 3.3% (record high)

Net worth is probably the best barometer of one's financial health. The recent financial crisis caused our net worth to drop by about 14% at one point. Since then our net worth has rebounded 37%. How has your net worth fared in 2009?

• Total Assets rose 1.3% (record high)
• Total Liabilities shrunk by 0.9%
• House Value/Total Assets fell to 62.8% (record low)

I like tracking this because it shows us how diversified we are. Our asset base is made up 62.8% by the value of our humble abode.

• Non-Registered Portfolio grew 3.4% (record high)
• Net Worth Calendar Year to Date Gain/Loss: +27%

2009 is shaping up to be a great year for our net worth. The year began amid the credit crisis and our net worth has grown leaps and bounds since then as the market has risen.

ADP dividend up 3%

Automatic Data Processing (ADP) reported better than expected fiscal first quarter earnings and hiked their dividend 3% to $0.34/share per quarter. This is the 35th year in a row that ADP has raised their dividend. Mounting unemployment in the U.S. continues to have an impact on ADP's revenues, as fewer workers for their clients means less fees to ADP.

ADP has forecasted EPS for fiscal 2010 to come in at about $2.37 per share. The stock is currently trading at 18.3x that forward earnings number and yielding 3%. The current dividend pay out indicates a pay out ratio of 57% on estimated 2010 earnings.

The stock is up 8% since I started a position in ADP inside my wife's RRSP. An interesting thing to note is that this stock seems to have really taken off despite the fact that US unemployment is at best flattening out. Could this be an indicator of the next 6 months to one year? Time will tell. If the job market turns up slower than expected, or stays at depressed levels, ADP could suffer.


* My wife owns shares of ADP in her RRSP.

Telus fails to raise dividend

Canadian telecommunications firm Telus (T.A) has failed to raise it's dividend for the first time in several years. Telus left it's quarterly dividend at $0.475/share for payment on January 4, 2010, the fifth straight quarter of this payment amount.

Some analysts believe that Telus is viewing 2009 as a year of investment in their business and they will resume dividend growth in 2010. Telus is striving to get ahead of the competition as they compete with Bell (BCE) and Rogers (RCI.B) among others including new potential entrants in Canada.

Telus announced earnings today that beat analysts estimates but were still virtually flat from last year at $0.88/share. They also lowered their full year sales and earnings outlook. The best analysts can say is that things don't seem to be getting any worse in the wireless area.