$CARR - A Good Choice for Any Climate
Welcome to my September Stock Idea! I bounced around a few options, but ended up choosing Carrier Global, $CARR. $CARR is one of my longest held positions and I currently hold it in both my Taxable Brokerage and Roth IRA.

I will hit a few key points about the company, why I invest currently, and what future prospects are for the company that continues to make $CARR a strong investment.

What is Carrier?
Carrier is a "Global leader in healthy, safe, sustainable and intelligent building and cold chain solutions". So what does this mean? Carrier's bread and butter is their HVAC (Heating, ventilation and air conditioning) equipment. Carrier equipment regulates and maintains the climate in your home & workplace through your air conditioner and furnace. Additionally, Carrier provides cooling solutions for industrial applications such as cooling towers, chiller units and refer cars to maintain temperatures in manufacturing processes and transportation. Carrier is the #1 industry leader in the following categories:

Why do I Currently Invest?
As I said above, Carrier is one of my core positions. I started my position in Carrier shortly after they re-listed on the public markets in 2020. I was drawn to Carrier initially by the undervalued share price in the company, compared to what I thought the value was, as well as the dividend.

Working in manufacturing, I was aware of the far reaches of the Carrier name as a provider for chiller units in my facility as well as many HVAC units in homes. It was a company I understood, interacted with, and saw the scope and stability of the business. My trades are currently linking to Commonstock, but you can see how much $CARR makes up my portfolio below:

I have been handsomely rewarded for holding $CARR for nearly 3 years. Share price of my initial investment has grown by over 180%, and is outpacing the S&P 500 by 100% in that time. $CARR is the #1 listing in the S&P Industrials sector since spin-off.

Additionally, the dividends have been steadily rolling in, and growing. In just the past two years, dividend payout has tripled from $0.16 per share in 2020 to $0.48 per share in 2021. One of the 4 capital deployment strategies in Carrier's Investor Day Presentation is to continue to grow the dividend, so I expect this trend to continue.

Why Will I Continue to Invest?
There are many tailwinds that will continue to support and propel Carrier's business in the years to come. There are two things that come to mind - sustainability and technology.

As the world goes green, so is Carrier. HVAC, especially cooling, is a highly energy intensive process. Huge investments are being made to drive towards a greener future, and Carrier is able to capitalize on these investments by offering less energy intensive products. $CARR is projecting a 9% CAGR in green infrastructure investments in the next few years. Carrier already has its vision for Sustainable Buildings, and the market opportunity for this transformation.

Not only does Carrier have the roadmap, but they also have the products to back it up and make the transformation happen:

Climate and environment control go hand in hand with innovation in healthcare, technology and manufacturing.

In research labs where healthcare advances are being developed, clean, controlled environments are required to ensure a sterile environment.

As technology, especially information technology, advances, cooling switch rooms, server rooms, and other applications is critical to ensure equipment functions properly.

Finally, as manufacturing advances and manufacturing processes become more temperature dependent, Carrier will be essential. Cooling reactors, raw materials, tanks, finished goods, all require cooling via chillers and cooling towers that Carrier provides

Conclusion
In summary, Carrier is a global leader in industrial and residential HVAC and cooling applications. $CARR has provided great share price appreciation as well as a growing dividend since its spinoff in 2020. Finally, Carrier has many tailwinds as the globe transitions to green alternatives and the need for climate control and cooling continues to increase.

What are your thoughts? Do you invest in $CARR. Are you thinking of adding to your watchlist?

Link to full Investor Day Presentation:
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Good stuff. Currently on my watchlist bc I haven’t done enough research on it yet, but I like what I know of them and I’m bullish on the companies that are going to make housing and buildings more energy efficient especially when it comes to heating and cooling. Currently invested in AOS and JCI. My one concern with CARR is HVAC is a bit commoditized, (lots of suppliers/not a lot of differentiation), and cyclical, but I think you make a good case as to why CARR could be the most investable leader in the space. The other company I’m considering is $TT Trane.
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September Watchlist Update
I have reviewed my watchlist and updated my potential Birthday Buys for the month of September. As we move closer to January, I am getting more clarity into what I will be buying.
Looking at both portfolios right now, the most intriguing additions are in my Roth IRA. The top rated holdings in my Taxable watchlist are all industrials type companies ($DE, $F, $CAT, and $DMLP). Seeing that I already have Industrials exposure in that account through $CARR, making another Industrials addition would only further clutter and dilute my portfolio.
In my Roth IRA, I have a number of very strong potential buys with $OZK, $RICK, $CAH and $LMT topping the list. As I have said before, I do not like to be influenced by share price, but with Merrill Edge not offering fractional shares, $LMT might be priced out for me in the short term.
Here is my updated watchlist for both accounts and changes that were made:

Taxable
Removed:
$PENN - Has dropped to a 4/6 on my Scorecard. $RICK has moved ahead of it at a 4.5/6. I have existing exposure in Sin Stocks, so I want to be certain with any new additions.
Added: None
Roth IRA
Removed:
$REGN - Dropped to a 4.5/6 on my Scorecard. $CAH is a higher ranked Healthcare company at a 5.5/6 on the Scorecard and will be my Healthcare focus.
Added:
$WM - Its back! After being removed in August, $WM has climbed up to tie $AY as Utilities options at 5/6 rankings.
$TPR - Surprised to see this climb up to a 5/6. Have been tracking for a while after learning about its brands. Will continue to track.
Would like to hear any of your thoughts on the companies mentioned to help add to my research on these positions.
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August Portfolio Review
Interesting month in August. Some macro events driving markets, rollercoaster in the oil space and the ever evolving inflation landscape.

Here is how my portfolios reacted and performed this month:

Overall Top 12
Not very much change in my Top 12, just some shuffling. $AAPL price increase moved it from #8 to #7. $TGT rose from #12 to #11. Other than that, no changes.

Taxable Portfolio
% Change (vs S&P): -2.64% (+1.33%)
Contributions: $94
Dividends: $16.92 (+29.9% over August '21)
Buys: None
Dividend Reinvestments: 0.0216 shares of $CARR, 0.0055 shares of $AAPL, 0.0301 shares of $ABBV, 0.0070 shares of $O
Sells: None
Cash: 1.75%

Top 5 Positions:
  1. $CMA (13.4%)
  2. $VTI (11.9%)
  3. $VEA (7.0%)
  4. $VWO (4.9%)
  5. $PFE (4.5%)

Historic Trend:

Roth IRA
% Change (vs S&P): -2.79% (+1.18%)
Contributions: $50 (thanks @commonstock)
Dividends: $10.34 (+54.6% over August '21)
Buys: None
Dividend Reinvestments: 0.0056 shares of $LOW, 0.0163 shares of $EMB, 0.0427 shares of $CARR, $0.0511 shares of $SBUX
Sells: None
Cash: 1.83%

Top 5:
  1. $VTI (12.2%)
  2. $VNQ (11.4%)
  3. $SBUX (9.4%)
  4. $VIG (9.1%)
  5. $HD (7.2%)

Historic Trend:

Thanks for following along on my journey. Glad to be able to share here and hold myself accountable with all of you! Would love to hear any thoughts or comments below!
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What was running through your mind when Target had that big drop in May? Did it make you want to sell, add more, or indifferent?


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Portfolio activity 8-12 Aug
Another nice week for my portfolios with all seeing healthy gains.

Income Portfolio: Opened a new position in $ROK . Increased holdings in $VIG and $VNQ . Collected dividends on $GD $BK $CARR and $APD . Trimmed position in $CARR

Growth Portfolio: Increased position sizes of both $ENPH and $SWAV.

Speculative: Nil.
Dividend Forecast - Week of 8/8
Good morning!
Below is my expected dividend income this week and how it will be utilized:
Taxable
$CARR - $0.15 per share, $0.92 total, reinvesting
$AAPL - $0.23 per share, $0.93 total, reinvesting
Roth IRA
$CARR - $0.15 per share, $1.82 total, reinvesting
$AAPL - $0.23 per share, $0.46 total, cash
Do you have any dividends coming in this week?
Air conditioning stocks have a major sales catalyst: Europe's massive heat wave
"A recent report by Inaba Denko, an air conditioning manufacturer, found that about 20% of European homes have air conditioning compared to more than 85% in the United States."

Yes, you read that right. Around 20% of European homes have air conditioning. For a long time, many Europeans questioned why American households have air conditioning. Some see it as "excessive" in terms of standard of living.

But ever since the heatwaves starting coming, more Europeans are starting to see the importance of having an AC.

Air conditioning companies like $WSO $CARR $FIX $AAON $JCI etc. will all see massive demand for their air conditioning units as more households in Europe start demanding them. With a high amount of savings among European consumers since the pandemic, many of them could be using it on installing an air conditioning system in their homes.

Europeans don't care for air conditioning and some say it causes a cough or that the recirculated indoor air is unhealthy or that it's just uncomfortable. They're not fond of ice or chilled drinks in a lot of Europe either. Anyway it'll be interesting to see if demand from these companies increases. I wonder if many European residences are outfitted with the type of windows or otherwise to accommodate units and wiring that can handle that kind of electricity?
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May Portfolio Summary
Not a lot of action in May. We have been focusing on using our extra money to pay down some credit cards to increase future cash flow, so I didn't have any new capital to work with. In the life of a buy and hold investor, that makes for a pretty boring month. No buys, other than automatic dividend reinvestments, and no sells. Nonetheless, May provided an "organic" observation of my portfolio 😂
Below is my overall portfolio, with both accounts. I will break down where some of these positions are held in the discussions on each portfolio.

Taxable
% Change (vs S&P): -0.29% (+0.27%)
Contributions: $0
Dividends: $14.11 (+18% over May '21)
Buys: 0.0065 shares of $AAPL, 0.0096 shares of $ABBV, 0.0245 shares of $CARR (all Dividend Reinvestment)
Sells: None
Cash: 1.9%
Top 5 Positions:
  1. $CMA - 13%
  2. $VTI - 12%
  3. $VEA - 8%
  4. $VWO - 5%
  5. $PFE - 5%
Historic Trend:

Roth IRA
% Change (vs S&P): -1.36% (-0.80%)
Contributions: $0
Dividends: $10.02 (+1,001% over May '21)
Buys: 0.0040 shares of $LOW, 0.0166 shares of $EMB, 0.0488 shares of $CARR, 0.059 shares of $SBUX (all Dividend Reinvestment)
Sells: None
Cash: 1.5%
Top 5 Positions:
  1. $VTI - 13%
  2. $VNQ - 12%
  3. $VIG - 9%
  4. $SBUX - 9%
  5. $HD - 7%
Historic Trend:

One bit of commentary - I am happy to see 2 of the Top 5 in each account are individual companies. I have been working to balance the ETF portfolios I had built through Wealthfront and rolled over.
Looking forward to June - it is a large dividend month with the Vanguard ETFs paying out. Should provide some more opportunities to buy!
Would love to hear any of your questions, comments or concerns with my portfolio!
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It's Getting Hotter...
In a note to subscribers last week, I said I'm adding the air-conditioning manufacturer Carrier Global $CARR to the portfolio.

The stock's already fallen from nearly $60, so I'm betting that the stock is more or less done falling. But if the shares fall below $34, we'll reconsider the position - or perhaps average down. At $34, the current share purchase would equal a loss of around 1% to the value of the portfolio - i.e. keep your losses small, let your winners run.

The stock has shown exceptional strength lately, staying even despite the general downward market volatility in the first half of May.

$CARR is a pioneer in air-conditioning from its earliest years. But the firm only had its IPO in early 2020 after being spun off from its longtime corporate parent United Technologies.

If anyone wanted to buy a stock that's likely to benefit from the tragedy and trend of global climate change - this is it.

A good example is in NYC, where the local power company warned consumers that their electric bills would likely rise by 12% on a monthly basis - hotter temperatures are causing more people to install window/portable a/c units.

Likewise, in places like India (where the company manufactures under its subsidiary Carrier Midea India)...the country is undergoing a record breaking heat wave in May. The electricity grid is strained to the max because people are buying a/c units to deal with literally life-threatening extreme heat temperatures.

$CARR is no rocket ship - more like slow and steady, with consistent rising demand. You can buy a new A/C unit, but eventually it's going to need new parts, a shot of freon, etc - so this is a high cash flow sort of business.

$CARR is on track to $2.29 a share this year, $2.58 a share next year, and $2.89 in 2024. Analysts have started to raise profit estimates recently (notice the upticks in the blue and orange lines in the chart below) after the company reported strong quarterly results recently.

As the chart below shows. analysts have begun raising profit estimates for $CARR for 2022 (the blue line) and notably for 2024 (the orange line).

The current valuation - a price/earnings ratio of 17 - is about as cheap as its been since the company held its IPO in 2020.

And we all know we can't do without our air-conditioners. The parts wear out. Every decade or two, we have to upgrade the whole system to more efficient models.

Not a bad business model to have.

Jeff
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Dividend Forecast - Week of 5/16
Taxable
$HAS - $0.70 per share, $0.71 total, cash
$ABBV - $1.41 per share, $1.48 total, reinvesting
$PG - $0.91 per share, $1.87 total, cash
$CARR - $0.15 per share, $0.91 total, reinvesting
$NSC - $1.24 per share, $1.24 total, cash
Roth IRA
$CARR - $0.15 per share, $1.81 total, reinvesting
Do you have any dividends coming in this week?
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