December 18, 2011

I Sold Bristol Meyers Squibb

In July 2009 I bought Bristol Meyers Squibb (BMY)

At the time I paid $19.6 for 25 shares.

Reasons I gave for buying the stock were :
1)6% dividend yield
2) PE of 7.5
3) solid financials
4) adding pharmaceutical holding
5) diversified

I recently sold my holdings for $33.36 per share.   The PE is now up to 17.18 and the dividend yield is 4%.  
 I mainly sold because the PE had gotten much higher and it had a pretty good run up in price.  With that high of a PE it isn't a particularly good bargain/value stock today.

Thats a 70% increase in market value in 2 years 5 months.  Over the past couple years the stock has also paid out $72.75 in dividends.

Initially spend $490, received $72.75 in dividends then sold for $834.

This equates to about 29% annual growth on investment including the dividend pay out.

By comparison in July 2009 the S&P 500 was trading around 900 levels and today is up to 1234.  The index then has gone up about 33% total or around 12% annually.   My investment in BMY easily doubled the performance of the S&P 500 index.

I would consider this a successful investment.   I  bought a solid company with good financials that was trading for a relatively low price and then rode the stock till it grew substantially then cashed in nice profit.


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