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Investopedia Stock Portfolio Review

Kyle Reese


Email : Reese.kyle99@gmail.com

Investopedia Stock Simulator - My Portfolio

Overview

This will be a semi-comprehensive review of the portfolio I have created on Investopdia’s stock simulator. I will list the number of shares I purchased and their purchase price (comes from profile dashboard on website). Then display key insights based on how they’ve been performing over the past few weeks. I will also go over why I bought the companies that I did and what I hope to accomplish with my investments. My portfolio is mostly a dividend driven plan with some growth aspects to it. I will demonstrate the simple calculations on how I created my $2,318.80 annual dividend portfolio that is already up in value 4.43% or $4,437.28! (Dividends will be highlighted yellow that make up the total $2,318.80 annual dividend)

Goals

  1. Dividend Portfolio My goal is to build passive income that will guarantee growth in my portfolio simply from dividends. I will reinvest dividends into more stocks that will further compound my money.

  2. Risk/Return Is an important ratio to be aware of when making investing decisions and I will share some of my thoughts on my risks and expectations of my returns.

My Portfolio.


1. (F) Ford Motors - bought 50 shares @ $20.03/share - $1,001.50

I bought Ford for the potential growth in EV sales and their strong position in the automotive industry. I expect generous price appreciation in the next 12 months, with some dividend growth as well. Currently getting $20 annually in dividends from Ford on a $0.40 dividend/share. Some risk relies on Ford being able to capture market share in the EV space from competitors like Tesla.


2. (PNC) PNC Financial - bought 8 shares @ $195.78/share - $1,566.24

I bought PNC for the solid dividend of $5.00/share, which yields me $40 annually with my 8 shares. PNC is also positioned well to face a high interest rate and inflationary environment. I expect most financial companies to perform well over the next few years to come. PNC has also been on a tear recently and is one of my best performers so far on a percentage return basis. I am also a customer of PNC for my business banking and student loans and am very pleased with their products and services. I am a believer in what this firm is trying to do and I’m happy to invest in them.


3. (RKT) Rocket Co. - bought 200 shares @ $14.53/share - $2,906.00

Rocket Mortgage has been a company I have been watching since before its IPO. The IPO price of around $24.00/share is a fair valuation for the company. I bought a small portion of RKT as a growth prospect due to its undervaluation. Rocket has distributed dividends in the past but not consistently and I am hopeful of a dividend return as more upside to this trade. Overall I assess a higher risk with this investment and am hoping for a proportionately higher return associated with that risk.


4. (PFE) Pfizer - bought 100 shares @ 58.30/share - $5,830.00

Pfizer is a clear pandemic winner and will reap the benefits of their effective vaccine for possibly decades. This company will be a backbone for growth in my portfolio while servicing a tasty dividend of $1.60/share amounting to $160 annually for my 100 shares. I bought in at a relative peak, so I have seen some short term poor performance with the stock price correcting a bit, but I am still optimistic about a 2022 continued price rally for PFE. Pfizer also offers many other profitable drugs that make up large portions of their revenues, including others in research and development that could lead to more potential earnings growth.


5. (BXMT) Blackstone Mortgage Trust - bought 200 shares @ $30.33/share - $6,066.00

Blackstone is a company that I find attractive because of their healthy dividend distribution and dividend history. BXMT distributes $2.48/share in dividends currently which amounts to $496 annually for my 200 shares. Another important attribute for Blackstone’s mortgage trust company is their exposure to real estate through mortgage holdings. With interest rates on the rise, I forecast possible dividend increases or continued price appreciation for BXMT.


6. (T) AT&T - bought 310 shares @ $23.68/share - $7,340.80

AT&T was the first company I ever owned with my own real money. It has been a rough ride since that original purchase in 2016. The stock was at all time highs and I bought for the trustable dividends then and I did again now. I lost money on the first trade, but never realized those losses and have been holding for the dividends since. The only difference now is the price is in a much better valuation and the management of the company seem to be turning things around with key divestitures & acquisitions taking place. I love the dividend of $2.08/share which amounts to $644.80 annually for my 310 shares. That dividend along with the recent price appreciation since I purchased these shares makes this seem like a sound investment moving forward.


7. (GOOGL) - Alphabet - bought 3 shares @ $2,824.00/share - $8,472.00

Alphabet is a monster. The management of this company has been Uber successful at creating shareholder value through acquisitions like YouTube and others. The flagship products like the search engine “GOOGLE” and “Gmail” products are other key drivers of value for Alphabet. I think the markets are due for a correction from the high growth stocks like Alphabet, but I felt the company was fairly valued and still wanted some exposure to FAANG stocks. GOOGL doesn’t offer dividends currently and could offer them in the future as potential upside for this investment. They are also uniquely positioned to withstand this high inflation environment with very high margins on their products/services.


8. (BAC) Bank of America - bought 200 shares @ $46.84/share - $9,368.00

Bank of America is a company that I wish I could’ve bought at a lower price as I calculate it trading at a very fair price and I would’ve liked to get it when it was undervalued. In my personal account with real money I bought in after the march 2020 dip when shares were $20 a piece, what a bargain! However, I am still comfortable with the return I am expecting with this investment as I think it is relatively low risk with a lot of upside potential. Including the strong dividend of $0.84/share giving me a $168 annual return on dividends alone. I expect BAC to do well all of 2022 with the current interest rate and inflationary environments.


9. (SNAP) Snapchat Inc. - bought 300 shares @ $42.74/share - $12,822.00

Snapchat is arguably a very high risk trade as the company hasn’t been profitable for very long. They are starting to turn a solid profit and can generate billions in revenue. I expect future earnings growth to continue as the company finds ways to generate more advertising revenue from their younger demographic that dominates their social media platform. The company identifies itself as a camera company and has been making great strides in the augmented reality market and is poised to see a measurable amount of growth because of their investment. This stock has room to soar, but I expect it to be volatile until it can post consistent earnings growth. Which I could see happening in 2022 or early 2023 based on their past quarters financial performance. They have had strong revenue growth and are grossing over a billion dollars a quarter, I expect that to continue with the fluctuations coming in earnings due to more research and development costs associated with the augmented reality segment of their business. SNAP has been getting hammered in the market this week, losing up to 10% at today's lows. That makes this trade seem to carry a lot of downside risk associated with it, but that is what I’m counting on which is why I expect a better than market return on this investment. Snap currently does not distribute any dividends.


10. (KHC) Kraft Heinz Co. - bought 350 shares @ $36.26/share - $12,691.00

I have seen this stock get crushed over the past few years and eventually the merger of Kraft and Heinz has started pulling themselves together. The dividend has stayed intact. KHC gives $1.60/share yielding me $560 annually from my 350 shares. They have had revenue growth stalled and varying earnings throughout the past couple years which is a risk, but I think with some new divestitures and other new business strategies being implemented that could reverse. I expect the divestitures to lead to an influx in cash which will ease supply constraints while helping the business invest in new opportunities. There is a fair amount of risk associated with this trade as there hasn’t been indications of stronger financial performance yet, but that is why I think the stock is trading at a discount and is a bargain for the solid dividend.


11. (WM) Waste Management - bought 100 shares @ $160.71/share - $16,071.00

Pfizer Waste Management is the easiest trade to place that I made. I love this company, their mission statement, their business model, and the consistent growth this company has been able to organically achieve. This company is always innovating and has a captivating market share that will strongly protect that healthy dividend of $2.30/share. That alone will bring me $230 annually and I expect some positive price movement as the stock has been trading lower over the past six months from all time highs. Waste Management is always looking for cutting edge innovation that can bring new ways grow the company while maintaining the core business. By that I mean the research and development this company has done on the use of the waste they collect. They even have pushed some marketing ads to support their scientific progress with slogans like, “What if your waste powered this truck? We’re turning ‘what if’s’ into what is.”


12. (HOOD) Robinhood Markets - bought 1,100 shares @ $16.32/share - $17,952.00

Ah, save the most bold of trades for last… Robinhood has been getting slammed in the market after not being able to maintain their account activity once crypto trading settled down on the platform. Financial projections were far to kind and management was somewhat misleading in presenting what growth was reasonable to continue after the first months of their IPO. Down from a $43 IPO price this stock sitting at around $16 is a steal. After all they still are a huge disrupter in the “Fintech” industry. They pioneered no commissions trading by using payment for order flow to generate revenue for the firm and value for their customers. They also connected a much less wealthy and younger demographic with their no account minimum policy. It was also impressive to see the marketing campaigns they rolled out, one popular to be named was the “refer a friend, you both get a free stock!” The company has taken a lot of criticism in the press and by the market, but I’m a firm believer in the long term outlook of Robinhood. That is why I think it is a bargain at $16/share and why I had to scoop up 1,100 shares! They don’t give any dividend yet, but I am hoping for some high risk adjusted return in the form of price appreciation over the next few years and a possible dividend for more upside.


Conclusion

My thesis for investing with this portfolio is to let the income producing equities fund my reinvested dividends into high growth and other dividend stocks. This is taking advantage of compounding my money while being adjusted for risk. I cited some of my concerns for the overall economic landscape and the major three things that are of concern are the variants of covid, inflationary pressures, and the disruptions in supply chains on the markets. They have all had major impacts on the economy already, and we will see how much they continue to be impacted in the coming months/years. My goal is to have at least a 10% annual return for this portfolio in this first year. As of right now I do not expect to make any other trades, but rather sit back to collect my dividends and reinvest them. I will be cognizant of price fluctuations, but won’t allow them to deviate me from my strategy. I will remain strong in the philosophies I am putting into practice and have faith they will serve me well over the course of 2022 and beyond.


P.S. More updates on my account to come. Please create an account in the Stock Simulator on “Investopdia.com”! I am not a financial beneficiary of that site, I am just an avid supporter. I encourage you to email me your trades you’ve made once you set up your account and we can talk over our investing decisions further. You can find financial information on Investopdia.com, yahoofinance.com, or bloomberg.com. They are all great resources that I use everyday and would highly recommend you check them out if you don’t already have them!

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