my Portfolio, you may have noticed that after last month's update my cash position actually became my 9th largest holding (out of 17) due to my sale of American Electric Power for a total return of 24% and my strong belief that the stock market is overvalued mostly.
9th out of 17 is relatively high for a cash holding, and so I recently wrote towards the end of July about considering Wells Fargo as one of the few remaining high quality, value purchases out there. I still believe this to be the case and consequently acted.
Over the last week or so I had watched the stock move sideways in a tight 48.5 range (shown below) for about five trading days or so, and I knew that I had to pull the trigger if I was going to do it.
I thought the stock was definitely going to move one way or the other (to be honest I wasn't certain it'd be up!), and I missed my opportunity to get it in the high 47s earlier in August, (though I did mention in my article that it might drop into the 47s). Anyway, in the end, I purchased it right before its most recent jump into the 50s. Here are the details of my trade:
# of Shares Purchased: 87
Purchase Price: $48.60
Yesterday's close price: $50.80
Thankfully I got in before this recent pop in share price as shown below, though I don't think it will stay as high as it is now nor do I intend to sell anytime soon, so it is basically a mute point. Nonetheless, I still think WFC is valued in the Low 60s, high 50s, giving me sufficient cushion at the stated entry price. Add to that a 3% yield, and increasing rate probabilities and you've got a pretty good total return I think.
What do you think? Often I stay away from financials. I know many have recommended Canadian banks, which I have not acted upon yet but am definitely interested.
Thanks for reading!
Passive Income Dude