If you can buy
a dividend growth company at a better price, you are rewarded with a higher yield.
Not exact matches
There are a multitude of reasons as to why this occurs but it's a powerful enough force that many investors have done quite well for themselves over an investing lifetime by focusing on
dividend stocks, specifically one of two strategies -
dividend growth, which focuses on acquiring a diversified portfolio of
companies that have raised their
dividends at rates considerably above average and high
dividend yield, which focuses on stocks that offer significantly above - average
dividend yields as measured by the
dividend rate compared to the stock market price.
So far nothing special from any of the
companies I hold and now I started doubting too if we will get anything one time special
dividend or one time buybacks or anything even
dividend growth has been generally in - line with past years
at least for the
companies I hold so far.
Companies that pay
dividends are saying that future
growth is limited so it's better to give
at least some of those profits back to owners so they can find better investments.
Management
at growth companies are able to use that earnings
growth to produce a higher return for investors with a return - on - equity of 17.8 % versus 16.4 % on average
at dividend - paying
companies.
The model has unmatched functionality, allowing the user to factor in not only a
company's near and long - term
dividend growth rate but also the quarterly reinvestment of growing
dividends at a future expected stock price.
In one of my latest blogposts, I wrote about the importance of putting rock solid defensive
companies such as consumer staples
at the core of the investment portfolio in order to build an ever growing passive income machine as a
dividend growth investor.
While the
company's five consecutive years of
dividend increases is a bit shorter of a track record than I'd typically like to see, the
dividend growth has been tremendous: the stock's three - year
dividend growth rate is sitting
at 44.2 %.
That's more than three - times the earnings
growth rate
at dividend - paying
companies of 4.6 % over the same period.
I usually look
at the past 5 years
dividend growth history to see how the
company has been doing and read more about management's
dividend policy in their annual statement.
Welcome to our exclusive
Dividend Growth Stock of the Month series, where we will take a look at solid dividend growth companies that you might want to consider for your own po
Dividend Growth Stock of the Month series, where we will take a look at solid dividend growth companies that you might want to consider for your own port
Growth Stock of the Month series, where we will take a look
at solid
dividend growth companies that you might want to consider for your own po
dividend growth companies that you might want to consider for your own port
growth companies that you might want to consider for your own portfolio.
A
company has control over how much it pays in
dividends, but the masses of the market are the ones that determine the stock price
at any given time, so the
company growth and the
dividends they pay are the primary points of focus for
dividend growth investors.
The Elk Valley Coal Partnership puts Teck, a
company that reinvests revenue into
growth,
at odds with the
dividend - hungry Ontario Teachers» Pension Plan.
This month's
Dividend Growth Stock of the Month is a
company that I included in the
Dividend Growth «ETF» that I launched in January
at Motif Investing.
Some names with low payout ratios in my portfolio include Illinois Tool Works Inc. (ITW)
at 39.8 %, Becton, Dickinson and
Company (BDX)
at 30.8 % and CR Bard Inc. (BCR) with a low 9.5 % payout ratio indicating a very safe
dividend with room for future
growth based on current cash flow.
Dividend growth investment (DGI) is about buying big and well driven
company at a fair or undervalued price.
But a look
at a
company's retained earnings can help us get a handle on what kind of
dividend growth to expect going forward into the future.
Shell Oil has more excess profit
at its disposal to fund future
dividend growth than
AT&T does (although
AT&T is a non-cyclical stock that can rely upon steady cash flow from which to pay shareholders each year, whereas Royal Dutch Shell is an oil
company that experiences low profits for 2 - 3 out of every ten due to the cyclical nature of oil and natural gas prices).
• The money stays in the same sector (real estate) • I move some money from being seriously overvalued to being nicely undervalued • The yield on that money moves up from 3.8 % to 5.3 % • I may be looking
at faster
dividend growth (although the future is never guaranteed) • I am reducing risk from being so concentrated in Realty Income • I may be adding a little risk by going down a bit in
company quality
Historically, three - year rolling returns have revealed consistent outperformance from the S&P 500 ®
Dividend Aristocrats ® Index, which is composed of quality companies with at least 25 consecutive years of dividend
Dividend Aristocrats ® Index, which is composed of quality
companies with
at least 25 consecutive years of
dividenddividend growth.
We also didn't want to miss out on the opportunity to invest in these
companies at both a fair price and with the potential for high future
dividend growth.
I know many
dividend growth investors that want
at least 50, or even 100,
companies in their portfolio.
• Trimmed JNJ and PEP each back to 9 % of the portfolio to get them under the 10 % - max guideline • With the proceeds, added to existing positions in
AT&T (T) and Microsoft (MSFT) • With the remaining proceeds, started a new position in Digital Realty Trust (DLR) Thus, this package of trades served several strategic goals
at the same time: • It corrected the over-sized positions by getting them back under 10 % of the portfolio • It allowed me to increase my stakes in two high - quality
dividend growth companies • It allowed me to add a new position, bringing me closer to my target of 20 - 25 stocks overall.
The
company is currently guiding for 12 % or greater annual EPS
growth, which should propel
dividend growth at least in kind.
Dividend growth has been a priority for Dover, which
at 62 consecutive years of annual distribution hikes boasts the third - longest such streak among publicly traded
companies.
Hi Bert - I agree that the
company is fairly valued here, and I've received a lot of comments
at SeekingAlpha.com about how people like to shop
at TJ Maxx but didn't know about the outstanding
dividend growth record.
If the
company grows earnings - per - share
at its expected 5 % to 8 % a year
growth rate, investors will have total returns of between 8 % and 11 % a year from
dividends (3 %) and earnings - per - share
growth (5 % to 8 %).
If there are fewer than 40 stocks with
at least seven consecutive years of
dividend growth, or if sector or country caps are breached, the index will include
companies with shorter
dividend growth histories.
Once a month, we look for good, solid
dividend growth companies that are selling
at a fair price.
We looked
at some of the top
dividend stocks, with an eye on sustainability of the existing
dividend, as well as selecting
companies that are likely to continue
dividend growth for years to come.
Historically, three - year rolling returns revealed consistent outperformance from the S&P 500 ®
Dividend Aristocrats ® Index, which is composed of quality companies with at least 25 consecutive years of dividend
Dividend Aristocrats ® Index, which is composed of quality
companies with
at least 25 consecutive years of
dividenddividend growth.
How long has the
company increased its
dividend payments and
at what
growth rate?
That
growth rate is roughly on par with the
company's long - term EPS
growth rate, and I think it's reasonable when also looking
at the recent
dividend growth, payout ratio, and cash position.
Since I won't even look
at a
company in detail unless it fits my investing style (high
dividend growth rate, etc), I chose
dividend growth rate as my # 1 criteria.
It is the only ETF or mutual fund tracking the S&P 500
Dividend Aristocrats Index, composed of the 52 S&P 500 companies with at least 25 consecutive years of dividend
Dividend Aristocrats Index, composed of the 52 S&P 500
companies with
at least 25 consecutive years of
dividenddividend growth.
•
At 3.2 %, the
company's yield is around average for the best
dividend growth stocks.
To weed out those
at risk of cutting their
dividend,
companies must have a positive five - year
dividend - per - share
growth rate and a
dividend payout ratio of no more than 60 % of earnings.
Dividends4Life presents Genuine Parts
Company (GPC)
Dividend Stock Analysis posted
at Dividend Growth Stocks, saying, «Genuine Parts Co is a leading wholesale distributor of automotive replacement parts, industrial parts and supplies, and office products.
To determine whether you are improving, I would compare the earnings
growth rates of the
companies that you select
at different stages of life, and adjust for the
dividend as necessary.
The
company has grown its
dividend year - over-year
at least 10 % in 18 of the 22 years of
dividend growth.
They have demonstrated excellent earnings and
dividend growth over the past 5 years and currently trade
at a PE ratio of 12; lower than 90 % of the
companies in their industry.
Considering KMI's wide moat, commitment to their
dividend, the current
dividend yield and the
company's
growth prospects, I believe KMI is a great addition to my portfolio
at this time.
You may find me pointing out
dividend growth companies that are a good value
at their current price, which may mean that it would be a good time to buy them.
American States Water could, however, keep the
dividend growth rate around nine percent for a couple of years, as an increase to the
company's payout ratio wouldn't be problematic
at all.
The
Dividend Kings are a small group of companies that have at least 50 years of dividend
Dividend Kings are a small group of
companies that have
at least 50 years of
dividenddividend growth.
Growth stocks may not pay
dividends at all or it may be that the
dividends pay - out of the
companies is damn low.
Companies that have
at least 50 years of
dividend growth are considered Dividen
dividend growth are considered
DividendDividend Kings.
My observations have been: — I have experienced low volatility similar to a balanced series of stock and bonds —
dividend income has grown between 6 - 8 % annually — not that much
growth potential as most of the individual stocks I own are mature
companies — I sleep well
at night — none of these
companies cut their distribution in 2008/2009 meltdown
The power of
dividend growth investing resides in
companies that double their
dividend at least every 10 years.
In order to really build that future
dividend growth expectation, though, we must look
at what kind of underlying business
growth the
company is generating.