THE DIVIDEND INVESTMENT ARCHIVES

Thursday, July 28, 2011

Dividend Growth Stocks: 8 High-Yielding Dividend Aristocrats Not Afraid to Raise Their Dividends

8 High-Yielding Dividend Aristocrats Not Afraid to Raise Their Dividends

The S&P 500 Dividend Aristocrats is the most recognized list of dividend stocks. The Dividend Aristocrats index is designed to measure the performance of S&P 500 constituents that have followed a policy of consistently increasing dividends every year for at least 25 consecutive years.

Dividend Aristocrats exhibit the following characteristics:

- They are a member of the S&P 500
- The index is equally weighted with constituents re-weighted quarterly
- List is reviewed and updated annually in December

Make no mistake, Dividend Aristocrats are the blue-blood of dividend growth stocks. When building your core portfolio, this list is where you want to start your evaluation. If you want dividend growth, these stocks have been there, and done that - for decades.

This week week, I screened my dividend growth stocks database for Dividend Aristocrats with a yield greater than 3% and have increased their dividends for at least 35 consecutive years. The results are presented below:

Procter & Gamble (PG)
Yield: 3.1% | Years of Dividend Growth: 54
The Procter & Gamble Company is a leading consumer products company that markets household and personal care products in more than 180 countries.

Pepsico, Inc. (PEP)
Yield: 3.1% | Years of Dividend Growth: 39
PepsiCo, Inc. is a major international producer of branded beverage and snack food products.

Johnson & Johnson (JNJ)
Yield: 3.2% | Years of Dividend Growth: 49
Johnson & Johnson is a leader in the pharmaceutical, medical device and consumer products industries.

Abbott Laboratories (ABT)
Yield: 3.6% | Years of Dividend Growth: 39
Abbott Laboratories is a diversified life science company and is a leading maker of drugs, nutritional products, diabetes monitoring devices, and diagnostics.

Kimberly-Clark Co. (KMB)
Yield: 4.1% | Years of Dividend Growth: 39
Kimberly Clark Corp. is a global consumer products company that produces tissue, personal care and health care. Its brands include Huggies, Pull-Ups, Kotex, Depend, Kleenex, Scott and Kimberly-Clark.

Consolidated Edison, Inc. (ED)
Yield: 4.5% | Years of Dividend Growth: 38
Consolidated Edison, Inc. is an electric and gas utility holding company that serves parts of New York, New Jersey and Pennsylvania.

Leggett & Platt, Inc. (LEG)
Yield: 4.6% | Years of Dividend Growth: 39
Leggett & Platt Inc makes a broad line of bedding and furniture components and other home, office and commercial furnishings, as well as diversified products for non-furnishings markets.

Cincinnati Financial Corp. (CINF)
Yield: 5.6% | Years of Dividend Growth: 51
Cincinnati Financial Corp. markets primarily property and casualty coverage. It also conducts life insurance and asset management operations.

As with past screens, the data presented above is in its raw form. Some of the the companies would be disqualified for poor dividend fundamentals. However some of the others may be worth additional due diligence.

My database, D4L-Data, is an Open Office spreadsheet containing more than 20 columns of information on the 210+ companies that I track. The data is sortable and has built-in buttons and macros to make it easy to use. Companies included in the list are those that have had a history of dividend growth. The D4L-Data spreadsheet is a part of D4L-Premium Services and is updated each Saturday for subscribers.

Retirement's 4% Rule: Surprising Answers You Need to Know About the Inflation Factor - Seeking Alpha

Retirement's 4% Rule: Surprising Answers You Need to Know About the Inflation Factor - Seeking Alpha: "The predominant retirement-financing method advocated by investment advisors, fund and ETF companies, AAII, Morningstar, and many pundits is called the “total return” approach. It has two phases:
The accumulation years, during which you save for retirement, targeting a nest egg whose ideal size is known as The Number.
The withdrawal years, when you sell off pieces of that nest egg to obtain the cash you need for living expenses during retirement."

Wednesday, July 27, 2011

51 Dividend Increases Expected in the Next 10 Weeks - Seeking Alpha

51 Dividend Increases Expected in the Next 10 Weeks - Seeking Alpha: "In compiling the Dividend Champions list I get to see what companies are nearing the anniversaries of their previous dividend increases. Since most of these firms raise their payout about the same time every year, I can say with some confidence that they are likely to do so again.

Activity Increasing

In the previous article in this series, I mentioned that we had passed the very slowest period of increases during the year in terms of declarations, and the number of approaching dividend increases seems to be picking up. Of the 46 companies listed in my July 11 article, 10 announced increases and one will pay the same amount for a fifth quarter, so again the majority of them have been carried over here, and are joined by companies with Ex-Dividend Dates in late September, and early October."

Thursday, July 21, 2011

How Dividend Investing Can Help You Stay Away From Ponzi Schemes ? Intelligent Speculator

How Dividend Investing Can Help You Stay Away From Ponzi Schemes

The last few years have seen many different trends in the financial markets. Unfortunately, one of them has been the explosion of frauds related to capital securities. Insider trading, market manipulation, and many other types of frauds are taking place at an increasing rate. One fraud that has been in the spotlights more than any other has been the Ponzi scheme. There have been small ones, big ones and then the Bernie Madoff one. These schemes have been happening a lot more than you would think but only the biggest ones got attention from the mainstream media.

How Ponzi Schemes Work

You can find much more detailed information but the basic concept is that investors buy shares in a fund. The manager then manages to publish falsified valuations making the returns look much better than they actually are. The effect is twofold:

-Current Investors Put More Money Into the Fund
-New Investors Come Knocking To Invest

This can go on for a long time because the basic ways such a scheme will get caught are if authorities catch on or when investors start withdrawing money which the fund often does not actually have. That is what happened to Madoff. If the financial crisis had not occurred, investors would have perhaps left their funds invested for many more years and the Ponzi scheme could have gotten much bigger. Other frauds such as Enron relied on different accounting frauds.

How Dividend Investing Can Help You Avoid Frauds

-Diversification: While it is not unique to dividend investing, the truth is that dividend investors tend to have much more diversity in their holdings than the average investor’s portfolio.

-Type Of Company: Generally, dividend investors tend to like long term, sustainable dividend companies such as the dividend aristocrats that have often been running for 50, 100 years or even more . While such companies can end up being fraudulent, the risk is much smaller than when investing in newer companies

-Take Money Out:One of the great things about dividend investors is that they take money off of the table in form of dividends. The only Bernie Madoff that did not get destroyed were those who had taken out money over the years instead of always reinvesting into the same funds.

Dividend Investors Beware

I think it’s still important for dividend investors to look out for opportunities that look too good to be true. A company cannot keep increasing dividends by 10% per year for decades, it’s just not possible. Still, I think that as a dividend investor, my odds of being caught up in a major fraud are diminished.

Do you agree?