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This was supposed to post Thursday April 30th it did not.
Orchid Island Capital, Inc. (ORC) had a pretty lackluster quarterly earnings report, and next month their $0.12 dividend is going to drop to $0.10. That’s a 16% dividend cut. Is this concerning? Maybe. I don’t have enough skin in the game to care too much.
What I do care about is that my game plan involved $5,000 in ORC totaling 670+ shares producing $83/m in dividends. Current prices ~$7.05 a share would actually require 710 shares now to reach the 5% allocation goal of the $50,000 dividend fund goal. That would have produced $85.20 a month at the old dividend, but now it will only produce $71. That’s $170 less per year.
Now I have stated multiple times that many funds in my experiment are risking very high dividend payouts in an attempt to speed up my snowball experiment. This is not an unexpected thing that could happen. What’s crazy to me is that my covered calls this week on $2,800 were able to produce $114 in premiums. The CCs take clicks and patience and maybe a little luck. The dividends take set-it-and-forget-it.
I guess this is a reminder for me to evaluate each stock in my plan as it “comes of age” in my buying order. Mix and matching the new covered calls with the dividend growth in order to try and maximize the bonuses. I’ve really been slacking on external income this month.
~~Miniwing~~
Investor, Stoic, Optimist