FFJ Portfolio - April 2022 Report

This is my FFJ Portfolio - April 2022 Report.

When Warren Buffett worked for Graham-Newman, his mentor (Ben Graham) advised him that:

'In the short run, the market is a voting machine. In the long run, it is a weighing machine. People have been successful investors because they've stuck with successful companies. Sooner or later the market mirrors the business.'

Keeping this in mind, I invest in high-quality profitable companies that generate positive free cash flow and which have a sound business model. In doing so, I do not worry about stock price fluctuations.

Purchases

In April, I increased my exposure to the following holdings in the FFJ Portfolio.

  • Brookfield Asset Management (BAM-a.TO): 200 shares @ ~$69/share
  • Copart (CPRT): 100 shares @ ~$116.346/share
  • Danaher (DHR): 25 shares @ ~$266.84/share
  • Intuitive Surgical (ISRG): 50 shares @ ~$254.65/share
  • FedEx (FDX): 6 shares @ ~$201.46/share

I also received additional shares through automatic dividend reinvestment in the following holdings which are either held in the FFJ Portfolio and/or in accounts for which I do not disclose details.

  • Genuine Parts
  • SmartCentres Real Estate Investment Trust
  • BCE
  • Cisco Systems
  • The Bank of Nova Scotia
  • The Canadian Imperial Bank of Commerce
  • Automatic Data Processing
  • Walmart
  • Canadian Pacific Railway
  • The Coca Cola Company
  • Alimentation Couche-Tard
  • Brookfield Infrastructure Partners LP
  • Brookfield Renewable Partners LP
  • Broadridge Financial Solutions
  • Ecolab

New Positions

In my April 4, 2022 Consider Home Depot For Its Attractive Total Investment Return Potential post, I disclose a new position with the purchase of 200 HD shares @ ~$303.36/share.

As an AT&T shareholder, I received shares in Warner Bros. Discovery, Inc. (WBD) when its WarnerMedia business was combined with Discovery. I hold these new shares in an account that is part of the FFJ Portfolio and also in a retirement account for which I do not disclose details.

I received shares in Embecta (EMBC) when Becton Dickinson (BDX) completed the spinoff of its former Diabetes Care business; EMBC is now one of the largest pure-play diabetes management companies in the world. I hold these new shares in an account that is part of the FFJ Portfolio and also in a retirement account for which I do not disclose details.

Dividend Income

Annual Registered Retirement Savings Plans (RRSP) withdrawals are part of our RRSP meltdown strategy. We will not start collecting our Canada Pension Plan and Old Age Security for several years for tax planning reasons.

Although I disclose just the dividend income generated from the holdings within the FFJ Portfolio, I do track the dividend income of all our holdings (including those held in registered accounts). This allows me to easily forecast what could be available if we decide to discontinue all, or a portion, of these automatic reinvestments.

Looking at April, the:

  • CDN dividend income generated from the holdings within the 'Core' accounts is ~$2550 versus ~$2478 in January. The variance is attributable to dividend increases and/or a greater number of shares because of dividend reinvestment.
  • USD dividend income generated from the holdings within the 'Core' accounts is ~$1393 versus ~$1820 in January. The variance is attributable to the $828.75 'special dividend' from CME that is distributed every January. CME distributes regular quarterly dividends in March, June, September, and December.
  • CDN dividend income generated from the holdings within the 'Side' accounts is ~$1758 versus ~$2421 in January.  The variance is attributable to Alimentation Couche-Tard's dividend distributed in April but not in January; the previous quarterly dividend was distributed in December 2021. In addition, The Toronto-Dominion Bank's quarterly dividend payment is scheduled to be distributed on April 30, 2022. This is a Saturday so I will not receive the dividend until the first business day of May.
  • USD dividend income generated from the holdings within the 'Side' accounts is ~$1115 versus ~$1611 in January. The variance is attributable to the $867.43 'special dividend' from CME that is distributed every January. The Automatic Data Processing position is new so the April dividend is the first dividend from this investment. In addition, FedEx distributed a dividend in April but not in January; the previous quarterly dividend distribution was in December 2021. Heico also distributes its semi-annual dividend in January and July.

Holdings

The month-end FFJ Portfolios are accessible here. The value of the holdings in the FFJ Portfolio as at the end of January - April 2022 are:

January 2022

Core Accounts: ~$773,000 CDN and ~$1,858,000 USD

Side Accounts: ~$666,000 CDN and ~$1,475,000 USD

Total: ~$1,439,000 CDN and ~$3,333,000 USD

February 2022

Core Accounts: ~$778,000 CDN and ~$2,014,000 USD

Side Accounts: ~$672,000 CDN and ~$1,465,000 USD

Total: ~$1,450,000 CDN and ~$3,479,000 USD

March 2022

Core Accounts: ~$810,000 CDN and ~$2,118,000 USD

Side Accounts: ~$696,000 CDN and ~$1,554,000 USD

Total: ~$1,506,000 CDN and ~$3,672,000 USD

April 2022

Core Accounts: ~$770,332 CDN and ~$2,026,487 USD

Side Accounts: ~$658,363 CDN and ~$1,514,137 USD

Total: ~$1,428,695 CDN and ~$3,540,624 USD

NOTE: The values reflected above exclude investments in several tax-efficient accounts for which I do not disclose details.

Final Thoughts

Stock price fluctuations should be of little concern if we invest in great companies.

I wish you much success on your journey to financial freedom.

Note: Please send any feedback, corrections, or questions to [email protected].

Disclaimer: I do not know your circumstances and am not providing individualized advice or recommendations. I encourage you not to make any investment decisions without conducting your research and due diligence. You should also consult your financial advisor about your specific situation.

I wrote this article myself and it expresses my own opinions. I am not receiving compensation for it and have no business relationship with any company whose stock is mentioned in this article.