Archer-Daniels-Midland Company (ADM) Purchased on 11/9/15

Archer-Daniels-Midland Company (ADM) has taken me on a roller coaster ride since I bought it, although my summary of the stock price and dividend growth makes it look like a slow, steady riser:

In actuality, the price has fluctuated wildly with a fall of about 20% before rebounding and moving up from there, as you can see in its F.A.S.T. Graph:

At the time I purchased ADM, I was happy to see that it had fallen quite a bit already.  It looked like a great deal.  A lot of stocks I purchased in late 2015 and early 2016 were falling for a number of months, and most of them have come back up quite a bit since.  Prices change with time, and not always in relation to changes in profits. 

Now profits were falling in 2015 at ADM, and the price fell with it.  But profits were rising in 2008, yet the price of ADM fell hard at the same time.  It is hard to say what might happen to any particular stock in the market.  But by comparing stock price to profits, it is easier to tell what might happen at some point in the future to the price of a stock.   

I will likely sell some of the stocks in this portfolio this year, and perhaps ADM should be on my list of stocks that I might sell at this time, mostly because it is now slightly overvalued.    But I am not necessarily in any hurry to get rid of ADM.  

ADM's dividend has been growing for a long time.  In 2000, it paid out dividends totaling 18 cents.  In 2017, the dividend payout will be $1.20 plus whatever increase comes along.  An increase is expected in February.  The dividend growth rate so far this century is about 12.5%.  And that is something that I would not give up unless something about ADM changes or something much more promising comes along and pulls me away.

Imagine what will happen with ADM's dividend if it keeps growing at that 12.5% growth rate until 2035:  

My current average monthly payment from ADM:  $1.24

The factor by which the dividend will grow if the 12.5% rate continues for 19 years:  9.37

My average monthly dividend from ADM in 2035 if the growth rate continues:  $11.62

If I receive that same payment from 42 different stocks, then the total is $488 per month.

That is not far off from my $560 goal.  

Of course there are a lot of assumptions going on here.  Plus, I did not take reinvested dividends into consideration in the calculations.  And different stocks have different dividends as well as different dividend growth rates.  This is going to be an interesting process.