Trimming My Omega Healthcare Position


Everyday I'm constantly monitoring and evaluating my portfolio holdings. As my portfolio continues to grow in size it becomes more and more important to monitor company news such as dividend increases, earnings reports and all relevant company happenings. 

As I continue to evaluate most recent company earnings sometimes a few things jump out at me. I like to maintain a SWAN stock other wise know as a sleep well at night stock. It's amazing to me how things can shift so quickly for some companies. a little over 6 months ago I was buying up OHI and feeling very confident about my position. 

I like to maintain some degree of risk/reward in my portfolio but after the last two quarters and earnings releases I had developed a lot less confidence in the large stake I held in my portfolio. A few things really hit me, one being the company announced they would not be able to increase the dividend payment over 2018. This is a big wake up call to investors that the company is not in the financial position they should be. 

The company is currently going into a restructuring phase and trying to find new tenants to lease buildings to. They have had a few rough quarters due to some tenants also not paying up which really puts a damper on the metrics. I personally felt that I had to much capital invested into what was becoming a high risk play. 

I decided to sell 70% of my holding and reallocate the fund among multiple companies. I ended up selling 87 shares which reduced my annual expected dividend income by an astounding $230... This is never fun to see but I knew it must be done in order to reduce the risk in my portfolio. 

I distributed the funds as such.

  • Stag 42 shares $59.64
  • ADM 10 shares $13.40
  • ED 5 shares $14.30
  • NRZ 12 shares $24
  • WPC 10 shares $40.40
  • Annual expected dividend from purchases = $151.74

With the sale and redistribution of the funds my annual dividend income is at $2,590.23This is still an amazing number but it just hurts to see it take such a steep dip. However, I know this is just temporary and It will be back into full throttle now that I've made some adjustments in the portfolio. 

I have really been analyzing my current holdings and will continue to invest in solid long term dividend growth companies. I probably should have never let my OHI position get as large as it was but, it's easy to lose sight of practical investing standards when one is faced with a high dividend yield. The company will most likely turn the whole situation around but for now I'm going to be sitting on the side lines. I would love to own OHI again down the road but for now I'm going to be focusing on solid blue chip DGI companies.

Thanks for stopping by and feel free to leave me a comment down below about my most recent trades.