I’d been thinking about and writing about to some extent, starting a position in Nestle, which is one of the biggest brands in the world and an absolute machine when it comes to generating wealth. The price has come down from a high of $81 per ADR share (1 ADR = 1 share on the Swiss exchange) to a low of $66 within the last week. As such, I scooped some up into my brokerage account. Nestle pays its dividend once per year and due to taxes in Switzerland it isn’t really a good idea to put the shares into a retirement account, as you’ll pay 35% on the dividend. In the brokerage account, you can fill out a form and get that knocked down to 15%, I believe. This is one of the reasons that this company gets so overlooked at times, however, even with the witholding tax Nestle is a beast.
The per share price is the lowest it has been in three years and I felt that this was a good entry point. With shares paying out $2.3195 in dividends in 2016, I expect another raise to be forthcoming, which should mean the dividend after taxes should be right around a 3% yield.
I’ll be continuing to watch this stock and hopefully it’ll move even lower so that I can grab more at a better price point.
Buy: 6.9683 shares @ $69.46 of Nestle SA (NSRGY). Increases forward dividends $16.17.