Recent Buy – WPC, EMR

Immediately after I sold 1200 PSEC shares, I executed the following stock purchase orders. – WPC  50 shares @ $63.4 + $9.99 commission at e*trade – EMR 50 shares @ $58.45 + $27 commission at my Japanese brokerage First, I bought W.P. Carey Inc. shares almost solely because I agreed with Dividend Mantra after reading his recent post and some comments on it. I have to admit that I am a follower rather than on my own, but I needed to add relatively high yield at the same time relatively stable stock to make up for PSEC. At my purchase price, yield at cost is about 6% and the expected annual gross dividend income from WPC is $195.50. EMR, Emerson Electric Inc. engages in designing and supplying product technology and delivering engineering services to various industrial and commercial, and consumer markets worldwide. The company operates through five segments: Process Management, Industrial Automation, Network Power, Climate Technologies, and Appliance and Tools. EMR has increased its dividend for 58 years in a row. Due in part to its exposure to the energy sector, however, EMR share price has declined by about 15% during the past year. According to my stock evaluation tool, its dividend payout ratio is 56% and divided coverage by free cash flow is 2.41. Given these numbers, I think it has a sustainable dividend payout.  As of the last trade day, its price is just 25% from 52W low (100% if the price is 52W high and 0% if it is 52W low). In addition, EMR is trading at 18.65 times trailing earnings and 15.25 times forward earnings. I thought the current valuation of EMR was very attractive.This purchase adds $31.00 to my annual dividend income, based on the current $0.47 quarterly dividend. How do you think? Full disclosure: Long WPC, EMR

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