I decided to buy an exploratory position last week in the world's leading animal health company, Zoetis (ZTS), because of something that Motley Fool co-founder David Gardner once said.

To paraphrase David, he said that if you have conviction in a stock, you should buy it, but in three blocks with the money you set aside for the purchase. If the stock price goes up after you buy, then you purchased the first block at a discount. But if the price goes down, then you can buy the next block cheaper and average down.

Zoetis was spun off from Pfizer in 2013 because they wanted to shed non-pharmaceutical subsidiaries, raise cash and pay down debt. It's estimated that Zoetis has about 15-20% of the global animal health market and is a fundamentally sound business.

On the latest Deep End podcast, the guys discussed Ryne's potential sale of Altria (MO), a tobacco company and dividend king, which got me thinking.

Not that long ago, I owned Altria because it pays a high dividend that has been increasing for over 50 years. So, as a dividend growth investor, it was a no-brainer.

But after owning Altria for a few years, I found it bothersome that I owned a company that undeniably harmed the end user... even if the product was legally and willfully purchased.

My wife and I have lost loved ones to cancer caused by years of tobacco use, and the weight of being an owner of a tobacco company became too great, so we sold in the mid-$40s.

One of the most stark differences between Altria and Zoetis is that one undeniably harms the end user, while the other benefits them. The end users of Zoetis are companion animals (our pets) and livestock (animals that provide food for humans).

How cool is that?! Zoetis helps our pets live longer and keeps livestock healthy until they're needed to feed people.

As my friend Ryne Williams said, "One is a win/lose, while the other is a win/win," and I agree.

The Zoetis purchase is exploratory, meaning that I pay attention to what I pay for, and it forces me to gain a better understanding of the company.

Over the next few months, I'll be reading Zoetis' annual reports, listening to earnings and conference calls and reading about the business to decide if I want to seriously scale into the position or sell out if I decide that it's not for me.

But whatever you're thinking of buying, it could make sense to take the money that you had planned on investing, divide it into thirds and buy three blocks weeks or months apart.

And that looks like a win/win situation to me!

Hit reply and let me know if you do anything similar when you're buying a new stock position... I'll respond to every reply!

Disclaimer: This is not investment advice, just one person's opinion. Do your own research before making any investment decisions.

😁THANK YOU to all who responded to the last newsletter!!

Check out the portfolio on Blossom, the podcast, or see what’s cooking on YouTube.

And now, here is this week's portfolio activity...

Dividends Received This Week ~$48.80

Starbucks (SBUX) | $48.80

Dividends Received Year to Date~

$2,157.02

Stocks Bought (AVERAGE)

7 Schwab Intl. Dividend ETF (SCHY) | $27.02
10 Schwab US Dividend ETF (SCHD) | $25.99
1 Zoetis (ZTS) | $168.00

Notable Ex-Dividends This Week + SSD Score

6/2 Expeditors International (EXPD), 1.37% | 99VS
6/2 NextEra Energy (NEE), 3.21% | 90VS
6/2 Lockheed Martin (LMT), 2.74% | 80S
6/2 McDonald's (MCD), 2.26% | 77S
6/2 Nike (NKE), 2.64% | 80S
6/2 Northrop Grumman (NOC), 1.91% | 90VS
6/2 Realty Income (O), 5.69% | 80S
6/4 Old Dominion (ODFL), 0.70% | 81VS
6/5 Home Depot (HD), 2.50% | 87VS
6/5 Landstar System (LSTR), 1.17% | 87VS
6/6 Genuine Parts Company (GPC), 3.26% | 80S
6/6 Kimberly-Clark (KMB), 3.51% | 88VS
6/6 PepsiCo (PEP), 4.33% | 93VS
6/6 Main Street Capital (MAIN), 5.38% | 62S

🎙️Podcast of the week🎙️

This Is How You Know It's Ti...

May 29 · The Deep End

72:57

Ari Gutman and Ryne Williams discuss selling stocks, and Ryne's gnawing feeling that it might be time to sell a dividend king...

🎦If you missed it, I used four AI chatbots to pick cheap and quality dividend growth stocks with a surprising result!

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