Dividend portfolio update: Imperial Brands, Unilever & Murray Income Trust

Imperial Brands Unilever

Over the past couple of weeks, I have capitalised on the market volatility and made several additions to my personal dividend portfolio. Here’s a look at what I’ve been buying.

Imperial Brands

I have owned tobacco manufacturer Imperial Brands (LON: IMB) shares for a few years now and took the opportunity to buy more shares recently, at a price of around 2,700p.

With analysts expecting a dividend payout of 187.2p per share this year, a prospective yield of 6.9% just looked too good to resist.

Imperial has raised its dividend by 10% per year for nine consecutive years now and promised to keep doing so in the medium term.

Just last week, the company stated in an AGM statement: “Cash generation remains strong underpinning our 10% dividend growth.”

Imperial’s long-term chart is shown below. It appears to me that the stock is right back near the long-term trend line. At the same time, the RSI indicator, which signals whether a stock is overbought or oversold on a relative basis, is signalling that Imperial is extremely oversold.

Imperial

Source: Stockopedia

The 7% yield on offer from Imperial is a steal, in my view.

Unilever

I have been waiting patiently for Unilever’s (LON: ULVR) valuation to come down a little, and in recent weeks, it has. I bought a small holding at around 4,000p. In hindsight, this was a little early, as the stock has continued to fall lower, however, at that level, the dividend yield was beginning to look attractive to me, at around 3.4%. While this clearly isn’t the highest yield in the FTSE 100, it’s a decent improvement on the 2.8% yield the stock offered in October, when the shares were around 4,550p.

I’ve bought the shares because I like the stability of the company’s earnings and also for the emerging markets story. I’ll be looking to add to my holding in the future.

Murray Income Trust

Lastly, I added another investment trust to my portfolio. I already own The City of London Investment Trust (LON: CTY), but thought I would add some extra diversification with the Murray Income Trust (LON: MUT).

In mid-January, this trust was trading above 810p. I picked it up at around 730p.

I’ve covered the trust before here. It’s run by Aberdeen Asset Management and was founded in 1923. It aims to achieve a high and growing income along with capital growth, and has increased its dividend for 43 consecutive years now.

Last year’s dividend payout of 32.75p per share gives me a yield of 4.5% on my purchase price.

The top holdings are shown below, and include Unilever, British American Tobacco and AstraZeneca.

Murray Income Trust

Source: murray-income.co.uk

I’m still sitting on plenty of cash at the moment, so I’m hoping the market volatility persists for a while. There are plenty of other high-yielding dividend-growth stocks I have my eye on right now.

 

Disclosure: Edward Sheldon, CFA owns shares in Imperial Brands, Unilever and Murray Income Trust. 

This article is provided for general information only and is not intended to be investment advice. The value of an investment may fall. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.

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