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I’ve been thinking about adding Tesco to my DRIP portfolio. It’s nice to hear that Buffett has a stake in Tesco, it makes my choice easier.  This is my DRIP portfolio at the moment:

Berkshire Hathaway Inc B              0.4225
Coca Cola                                     14.30654
Kraft Foods Inc                             23.16033
McDonalds                                    10.63966
Nestle N                                        2.89255
PepsiCo                                        13.17289
Procter&Gamble                        2.25718
Lloyds Bank                                  964.57166

Current Portfolio value: $4012

My DRIP portfolio as you can notice is a mixture of income stocks and risk. Lloyds bank is a risky move and the other stocks except Berkshire are income stocks. It feels nice having a income portfolio with growth. Going to sleep is alot easier, believe me!

I know that my DRIP portfolio is ridiculously small, I’m waiting for better opportunities to buy more shares. I’m looking intensely at the share prices of Coca Cola and Pepsico. Coca cola and pepsico are obvious choices for the income investor. I think the majority of dividend investors have pepsico and coca cola in their drip portfolio. But it’s important to get them at fair prices.

I’m looking to buy more shares at:

KO < $50

PEP < $55

Good luck fellow dividend investors! 

The company has strong brands and was punished for the cadbury-nonsense. Steady growth and reliable dividends makes this company a good DRIP. I like the fact the stock was lowered because of disappointment with the managment. But the facts remain that Kraft Foods is a strong company with growth and relatively low P/E of 16.75. Income investors should consider adding Kraft Foods to their portfolio.

Kraft foods hasn’t performed well since it’s IPO:

This is one disappointing graph for investors. The stock price is even lower today then it was since its IPO.

But the profit and the dividend of kraft foods has been on a steady rise during this period. The reason why Kraft Foods hasn’t performed well is because the P/E ratio when it first went public was relatively high, the profit growth was already priced in the stock.  Looking at historial performance for Kraft Foods can be a very misleading indicator on how the future will be. I think that Kraft Foods will perform way better than the past 10 years. I’m saying this because now it’s trading at a lower P/E than before and Kraft’s profit is still growing. With a divided yield of 4.10% and a yearly dividend growth between 7-10% makes Kraft Foods a good high dividend paying stock with growth potential. My estimate is that Kraft will outperform dow jones and S&P500 for the next ten years.

I have bought Kraft Foods shares for my DRIP portfolio. My plan is to regurarly buy more KFT shares every month, I believe it will be great DRIP stock.