Emerson Electric Co. (EMR), Becton, Dickinson and Co. (BDX): An Island of Sanity in a Volatile Market

As the market zigzagged over the past couple of weeks, the real-money Inflation-Protected Income Growth portfolio just kept humming along, collecting dividends and buying shares. Since the last general update near the end of March, the portfolio is up a couple hundred dollars, which isn’t bad given the near-daily whipsaw it feels like we’ve been riding recently.

The secret to the portfolio’s success isn’t much of a secret at all. Instead, it’s a time-tested approach to investing inspired by Benjamin Graham, the father of value investing and the man who taught investing to Warren Buffett. By combining the benefits of dividends, valuation, and diversification into one single vehicle, the iPIG portfolio is designed to let the companies behind the stocks, not the market’s daily fluctuations, drive the investment returns.

Emerson Electric Co. (NYSE:EMR)

So what did happen?
While the overall message was one of relative calm, the market’s machinations did provide the iPIG portfolio the opportunity to pick up shares of Emerson Electric Co. (NYSE:EMR) . As a company with over 55 years of consistently rising dividend payments, it’s a natural fit for a portfolio that seeks to invest in an increasing income stream. Yet until the market was so kind as to knock down Emerson’s price to a more reasonable level, it was simply too pricy to justify buying.

Additionally, Becton, Dickinson and Co. (NYSE:BDX), made good on its dividend pledge, handing the iPIG portfolio $8.91 for the 18 shares it holds ($0.495 per share). That was the second consecutive dividend by Becton, Dickinson at that level. Should the medical device titan follow recent trends, I anticipate that it could increase its dividend near the end of the year for its December payment.

Not to be outdone, Genuine Parts Company (NYSE:GPC) also continued its long streak of paying and increasing dividends. The iPIG portfolio picked up $12.36 for its 23 shares ($0.5375 per share). That was Genuine Parts’ first dividend payment at its new higher rate, and like Emerson Electric Co. (NYSE:EMR), Genuine Parts can celebrate more than 55 consecutive years of increasing dividends.

Finally, Union Pacific Corporation (NYSE:UNP) kept moving money into the iPIG portfolio’s pocket, handing the portfolio $4.14 for the six shares it holds ($0.69 per share). As with Becton, Dickinson and Co. (NYSE:BDX), that was Union Pacific’s second dividend at its current level. Should that railroad giant keep with its pattern, it’d be on track to raise its dividend near the end of the year, as well.

And what comes next?
None of the companies in the iPIG portfolio are expected to pay dividends in the next week or so, but the portfolio still has a touch more than $3,000 in cash that it can deploy. About half of that is in a limit order waiting to see if the market will offer another opportunity to buy the stock that might get away. The other half? It’s available if the market offers up another compelling opportunity like it did last week with Emerson Electric Co. (NYSE:EMR).

To follow the iPIG portfolio as buy and sell decisions are made, watch my article feed by clicking here. To join The Motley Fool’s free discussion board dedicated to the iPIG portfolio, simply click here.

Dividends matter
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iPIG Portfolio Snapshot as of April 5, 2013

Company Purchase Date No. of Shares Total Investment (including commissions) Value as of April 5, 2013
United Technologies 12/10/2012 18 $1,464.82 $1,667.52
Teva Pharmaceutical 12/12/2012 38 $1,519.40 $1,490.36
J.M. Smucker 12/13/2012 17 $1,483.45 $1,668.04
Genuine Parts 12/21/2012 23 $1,476.47 $1,772.38
Mine Safety Appliances 12/21/2012 36 $1,504.96 $1,762.56
Microsoft 12/26/2012 55 $1,499.15 $1,578.50
Hasbro 12/28/2012 43 $1,520.60 $1,863.19
NV Energy 12/31/2012 84 $1,504.72 $1,758.96
United Parcel Service 1/2/2013 20 $1,524.00 $1,670.80
Walgreen 1/4/2013 40 $1,501.80 $1,880.40
Texas Instruments 1/7/2013 47 $1,515.70 $1,607.40
Union Pacific 1/22/2013 6 $805.42 $831.24
CSX 1/22/2013 34 $712.50 $810.56
McDonald’s 1/24/2013 16 $1,499.64 $1,622.72
Becton, Dickinson 1/31/2013 18 $1,518.64 $1,729.98
AFLAC 2/5/2013 27 $1,466.35 $1,336.23
Air Products & Chemicals 2/11/2013 17 $1,510.99 $1,447.21
Raytheon Company 2/22/2013 27 $1,473.91 $1,570.86
Emerson Electric 4/3/2013 28 $1,548.12 $1,560.44
Cash $3,102.28

Data from the iPIG Portfolio’s brokerage account, as of April 5, 2013.

The article An Island of Sanity in a Volatile Market originally appeared on Fool.com is written by Chuck Saletta.

Fool contributor Chuck Saletta owns shares of every public company named in this article. The Motley Fool recommends Aflac, Becton Dickinson, Emerson Electric., Hasbro, McDonald’s, Mine Safety Appliances, and United Parcel Service. The Motley Fool owns shares of Hasbro, McDonald’s, Microsoft, and Raytheon.

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