MY NEXT TWO STOCKS FOR MY IRA ACCOUNT

I revised my automatic stock purchase plan for my IRA account to purchase my next two dividend stocks.  The newest additions to my IRA will be Eli Lilly (LLY) and Pfizer Inc. (PFE).  Both are well known corporate brands with great dividend yields and have a long history of paying dividends.  I believe that both companies will be around for years to come and will make good additions to my investment portfolio.  The purchase of shares in these two stocks will add a total of 8 dividend payments per year towards my goal of 365 days of dividends. 

PFIZER AND PEPSI ARE OUT, LINN IS IN!

I recently reviewed the terms of the merger between PBG and Pepsi Co and decided instead, to take advantage of recent price increases to sell my position in Pepsi Bottling. I also decided to sell my stake in Pfizer due to lackluster performance and poor dividend returns. The proceeds from the sale of these two stocks will be reinvested in Linn Energy LLC (LINE: NASDAQ).

Linn Energy carries a dividend payout of $2.52 which works out to over a 9.5% yield on their recent share price of $26.03. Linn Energy, LLC. is an independent oil and gas company focused on the development and acquisition of long life properties which complement its asset profile in producing basins within the United States. The company's properties are currently located in the Mid-Continent and California. The company seeks to be the operator of its properties so that it could develop drilling programs and optimization projects that not only replace production, but add value through reserve and production growth and future operational synergies. The development program is focused on lower risk, repeatable drilling opportunities to maintain and/or grow cash flow. The oil and gas industry is highly competitive. The company encounters strong competition from other independent operators and master limited partnerships in acquiring properties, contracting for drilling and other related services and securing trained personnel.

Adding Linn Energy to my investment portfolio should work well with my goal for 2010 of increasing dividend income. With the recent increase in demand for oil and gasoline along with rising prices, I think Linn will do well for the foreseeable future.

It's All About Earnings

About half the Dow 30 and a quarter of the S&P 500 report in the week ahead. Analysts expect the majority of these companies to continue to beat expectations. Of the 61 S&P companies that reported so far, 79 percent have reported better than expected earnings. The Dow gained 1.3 percent for the week, ending at 9,995, just shy of the 10,000 mile marker it reached on Wednesday. The S&P 500 scored a 1.5 percent gain, ending the week at 1,087. The dollar lost about 1 percent against the euro and the same against a basket of currencies.

Stocks declined Friday as disappointing results from Bank of America and General Electric eclipsed strong results from big techs. After two straight finishes above 10,000, the Dow Jones Industrial Average shed 67.03, or 0.7 percent, finishing at 9,995.91. Still, for the week, the blue-chip index gained more than 100 points, or 1.3 percent. This is the second straight week the Dow is up — it's gained more than 5 percent in that time. Shares of both GE and Bank of America lost more than 4 percent.

Pfizer, which reports Tuesday, expects higher earnings on slightly lower revenue, while Merck (MRK: 33.22, -0.09, -0.27%), which reports Thursday, is likely to post profit and revenue increases. Eli Lilly & Co. (LLY: 34.42, -0.09, -0.26%), reporting Wednesday, is expected to return to the black after last year's results were hurt by legal settlements. Economists predict small increases in September building permits and housing starts from the previous month, continuing the general trend since spring. That report is due Tuesday, a day after the National Association of Home Builders releases its October housing market index, which reflects builders' confidence in the market. Next Friday, the National Association of Realtors reports on September existing-home sales, which are forecast to grow 5.5% from a month earlier. Sales dropped in August after rising since April.

The government will issue the September Producer Price Index, which measures wholesale inflation, on Tuesday. Predictions are for a 0.1% rise, after a bigger-than-expected 1.7% increase in August. On Wednesday, the Federal Reserve will release its Beige Book, which provides information about economic activity in various regions. The nonprofit Conference Board's September index of leading indicators is out Thursday.

(I currently own shares of Merck and Pfizer so I'm hoping for good news from both.)