Dividends Value » DCI

12 Stocks Not Missing Their Opportunity To Increase Dividends *

D4L — Fri, 26 Nov 2010 07:30:30 +0000

In everything we do, we always want to be the best or be associated with the best. You never hear fans yelling, ‘We’re number 2, we’re number 2′, while holding two fingers in the air. The same is true when selecting dividend stocks. One attribute of the very best dividend stocks is a long history of consecutive dividend increases.

Below are several dividend stocks that did not miss their opportunity increase cash dividends:

Donaldson Co. (DCI) operates as a worldwide manufacturer of filtration systems and replacement parts. November 19th the company increased its quarterly dividend 4% to $0.13/share. The dividend is payable December 17, 2010, to shareholders of record as of December 6, 2010. The ex-dividend date is December 2, 2010. DCI is a Dividend Achiever and has raised its dividend for 24 consecutive years. The yield based on the new payout is 1%.

South Jersey Industries (SJI) is an energy services holding company that provides energy related products and services. November 22nd the company raised its quarterly dividend 10.6% to $0.365/share. The dividend is payable December 29, 2010 to shareholders of record at the close of business December 10, 2010. The ex-dividend date is December 8, 2010. SJI is a Dividend Achiever and has raised its dividend for 11 consecutive years. The yield based on the new payout is 2.9%.

York Water (YORW) impounds, purifies and distributes water in York County and Adams County, Pennsylvania. November 22nd the company increased quarterly dividend 2.3% to $0.131/share. The dividend is payable January 14, 2011 to shareholders as of record date December 31, 2010. The ex-dividend date is December 29, 2010. The yield based on the new payout is 3.3%.

Hormel Foods (HRL) is a leading processor of branded, convenience meat products (primarily pork) for the consumer market. November 22nd the company raised its quarterly dividend to $0.25/share. The quarterly dividend is payable Feb. 15, 2011, to stockholders of record at the close of business on Jan. 23, 2011. The yield based on the new payout is 2.1%.

Becton, Dickinson & Co. (BDX) provides a wide range of medical devices and diagnostic products used in hospitals, doctors’ offices, research labs and other settings. November 23rd the company increased quarterly dividend 10.8% to $0.41/share. The dividend will be payable on December 31, 2010 to holders of record on December 10, 2010. The ex-dividend date is December 8, 2010. BDX is a Dividend Aristocrat and has raised its dividend for 37 consecutive years. The yield based on the new payout is 2.1%.

Ship Finance Int’l (SFL) owns an international fleet of crude oil tankers, which are leased under long-term, fixed-price charters. November 23rd the company raised its quarterly dividend 2.9% to $0.36/share. The dividend is payable on or about December 30, 2010 to shareholders of record as of December 8, 2010. The ex-dividend date will be December 6, 2010. The yield based on the new payout is 6.2%.

RGC Resources (RGCO) distributes and sells natural gas in Virginia to residential, commercial and industrial users through underground mains and service lines. November 23rd increased quarterly dividend 3% to $0.36/share. The dividend will be paid on February 1, 2010 to shareholders of record on January 14, 2011. The ex-dividend date is January 12, 2010. The yield based on the new payout is 4.4%.

Guess? (GES) offers one of the world’s leading lifestyle collections of contemporary apparel and accessories for men, women and children, sold in multiple channels including wholesale, company-owned retail locations, e-commerce, and licensed stores. November 23rd the company raised increased its quarterly dividend to $0.20/share. The yield based on the new payout is 1.6%.

Raymond James (RJF) offers securities brokerage, investment banking, financial planning, banking and investment advisory and related financial services. November 23rd the company raises its quarterly dividend by 18% to $0.13/share. November 23rd the company raised its quarterly dividend by 18% to $0.13/share. The dividend is payable on Jan. 19 to shareholders of record on Jan. 3. The yield based on the new payout is 1.81%.

McCormick (MKC) manufactures, marketing and distribution of spices, herbs, seasonings, specialty foods and flavors to the entire food industry. November 23rd raised its quarterly dividend 8% from to $0.28/share. The dividend is payable on Jan. 14 to shareholders of record on Dec. 31. The ex-dividend date is Dec. 29. MKC is a Dividend Achiever and has raised its dividend for 24 consecutive years. The yield based on the new payout is 2.5%.

Oriental Financial (OFG) provides a range of financial products and services primarily in Puerto Rico and Florida. November 24th the company increased its quarterly dividend 25% to $0.05/share. The dividend is payable on Jan. 14 to shareholders of record on Dec. 31. The ex-dividend date is Dec. 29. The yield based on the new payout is 1.68%.

Abington Bancorp (ABBC) owns Abington Savings Bank, d/b/a Abington Bank, which provides various financial products and services in Pennsylvania. November 24th the company increased quarterly dividend 20% to $0.06/share. The dividend is payable on Dec. 21 to shareholders of record on Dec. 7. The ex-dividend date is Dec. 3. The yield based on the new payout is 2.02%.

Selecting stocks with increasing dividends is critical for an income growth strategy. The above list contains stocks that recently raised their dividends; it is not a list of recommend buys. As always, due diligence should be performed before buying or selling any stock. For a list of stocks with a long string of consecutive cash dividend increases, see this list.

Full Disclosure: No position in the aforementioned securities. See a list of all my income holdings here.

(Photo Credit)

3 Signs of an Impending Dividend Cut

D4L — Fri, 06 Aug 2010 07:30:39 +0000

Most investors are not surprised when a company cuts its dividend. They saw the early warning signs well in advance of the actual cut. Here are three signs that a company is heading toward a dividend cut:

1.) An abrupt or permanent shift in a company’s business model as a result of business conditions.
2.) A dividend yield that is higher than average and/or higher than others in the industry.
3.) Diminishing cash available to pay dividends.

Ultimately, the ability of a company to pay its dividend is determined by its cash position – both cash on its balance sheet and its ability to generate cash flow. Below are several companies that are NOT cutting their dividends, but instead raising them:

BreitBurn Energy (BBEP) explores and develops oil & gas properties in U.S. July 30th the company increased its quarterly distribution 2% to $0.3825/unit. The distribution is payable on August 13, 2010 to the record holders of common units at the close of business on August 9, 2010. The ex-distribution date is August 5, 2010. The yield based on the new payout is 9.40%.

American Water (AWK) provides water, wastewater and other water-related services to residential, commercial, and industrial customers in the United States and Canada. July 30th the company raised its quarterly dividend 5% to $0.22/share. The quarterly dividend is payable on September 1, 2010 to all shareholders of record as of August 18, 2010. The ex-dividend date is August 16, 2010. The yield based on the new payout is 4.08%.

Donaldson Co. (DCI) operates as a worldwide manufacturer of filtration systems and replacement parts. July 30th the company increased its quarterly dividend 4% to $0.125/share. The dividend is payable September 10th to shareholders of record as of August 20, 2010. The ex-dividend date is August 18, 2010. DCI is a Dividend Achiever and has raised its dividend for 23 consecutive years. The yield based on the new payout is 1.07%.

NuStar GP Holdings, LLC (NSH) owns the 2% general partner interest, a 16.7% limited partner interest, and the incentive distribution rights in NuStar Energy L.P. August 2nd the partnership raised its quarterly distribution 2% to $0.46/unit. The distribution is payable on August 18, 2010, to holders of record as of August 6, 2010. The ex-distribution date is August 16, 2010. The yield based on the new payout is 5.98%.

PetMed Express (PETS) markets prescription and non-prescription pet medications and other health products for dogs, cats, and horses directly to the consumer. August 2nd the company raised its quarterly dividend 25% to $0.125/share. The dividend is payable on August 27, 2010, to shareholders of record at the close of business on August 13, 2010. The ex-dividend date is August 11, 2010. The yield based on the new payout is 3.11%.

Herbalife (HLF) sells weight-management, nutritional supplement, and personal care products. August 2nd the company increased its quarterly dividend to $0.25/share. The yield based on the new payout is 1.91%.

W&T Offshore (WTI) is focused on exploring and developing hydrocarbon resources in the Gulf of Mexico, primarily in the deep shelf and deepwater. August 2nd the company raised its quarterly dividend to $0.04/share. The dividend is payable on September 10, 2010, to the shareholders of record on August 20, 2010. The yield based on the new payout is 1.68%.

Steris (STE) develops, manufactures and markets infection prevention, contamination control, microbial reduction, and surgical and critical care support products and services. August 3rd the company increased its quarterly dividend 36% to $0.15/share. The dividend is payable September 21, 2010 to shareholders of record at the close of business on August 24, 2010. The ex-dividend date is August 20, 2010. The yield based on the new payout is 1.88%.

Euroseas (ESEA) provides ocean-going transportation services worldwide. It owns and operates drybulk carriers that transport iron ore, coal, grains, bauxite, phosphate and fertilizers. August 3rd the company raised its quarterly dividend 20% to $0.06/share. The dividend is payable on September 03, 2010 to all shareholders of record as of August 25, 2010. The ex-dividend date is August 23, 2010. The yield based on the new payout is 5.60%.

Nationwide Health Properties (NHP) invests in senior housing facilities, long-term care facilities and medical office buildings. August 3rd the company increased its quarterly dividend 2.2% to $0.46/share. The dividend is payable on September 3, 2010 to stockholders of record on August 20, 2010, with an ex-dividend date of August 18, 2010. The yield based on the new payout is 4.81%.

Broadridge Financial (BR) provides technology-based outsourcing solutions to the financial services industry. August 3rd the REIT raised its quarterly dividend 7% to $0.15/share. The dividend is payable on October 1, 2010, to stockholders of record at the close of business on September 15, 2010. The ex-dividend date is September 13, 2010. The yield based on the new payout is 2.92%.

Atrion Corp. (ATRI) designs, develops, manufactures, markets, sells and distributes various products and components, primarily for the medical and health care industry. August 3rd the company increased its quarterly dividend 16.7% to $0.42/share. The dividend is payable on September 30, 2010 to stockholders of record at the close of business on September 15, 2010. The ex-dividend is September 13, 2010. The yield based on the new payout is 1.68%.

Acme United (ACU) supplies cutting, measuring, and safety products to the school, home, office, and industrial markets in the United States, Canada, Europe, and Asia. August 4th the company raised its quarterly dividend 20% to $0.06/share. The dividend is payable on October 21, 2010 to stockholders of record on the close of business on October 1, 2010, with an ex-dividend date of September 30, 2010. The yield based on the new payout is 2.30%.

Murphy Oil (MUR) has exploration and production interests worldwide, and refining and marketing operations in the U.S. August 4th the company increased its quarterly dividend 10% to $0.275/share. The dividend is payable on Sept. 1 to shareholders of record on August 16. The ex-dividend date is August 12. MUR is a Dividend Achiever and has raised its dividend for 14 consecutive years. The yield based on the new payout is 1.94%.

Leggett & Platt (LEG) 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. August 4th the company raised its quarterly dividend 3.8% to $0.27/share. The dividend is payable on October 15 to shareholders of record on September 15. The ex-dividend date is September 13. LEG is a Dividend Aristocrat and has raised its dividend for 39 consecutive years. The yield based on the new payout is 5.08%.

Monsanto (MON) is a global provider of agricultural products and integrated solutions for farmers. August 4th the company raised its quarterly dividend 5.7% to $0.28/share. The dividend is payable on October 29, 2010 to shareholders of record on October 8, 2010. The ex-dividend date is October 6, 2010. The yield based on the new payout is 1.88%.

Delphi Financial Group (DFG) provides a diverse portfolio of employee benefit products to customers across the U.S. August 5th the company increased its quarterly dividend 10% to $0.11/share. The dividend is payable on September 1, 2010 to shareholders of record at the close of business on August 18, 2010, with an ex-dividend date of August 16, 2010. The yield based on the new payout is 1.71%.

Dover Corp. (DOV) manufactures a broad range of specialized industrial products and sophisticated manufacturing equipment. August 5th the company raised its quarterly dividend 6% to $0.275/share. The dividend is payable September 15, 2010 to shareholders of record as of August 31, 2010. The ex-dividend date is August 7, 2010. DOV is a Dividend Aristocrat and has raised its dividend for 55 consecutive years. The yield based on the new payout is 2.24%.

Full Disclosure: Long LEG. See a list of all my income holdings here.

(Photo Credit)

18 Dividend Stocks Raising Their Yield On Cost *

D4L — Fri, 26 Feb 2010 11:30:21 +0000

For dividend growth investors, there are certain attributes of investments that are more relevant than others, such as yield and dividend growth. To illustrate the power of dividend growth consider that an investment’s yield-on-cost will double every 5 years if they grow their dividend by 15%/year or 7 years at 10%/year or 14 years at 5%/year.

This week several companies took a step toward doubling their shareholders yield-on-cost by increasing their cash dividends:

PG&E Corp. (PCG) is the parent of Pacific Gas & Electric Co. On February 19th the company increased its quarterly dividend to to $0.455/share. The yield based on the new payout is 4.33%.

Abbott (ABT) is a leading maker of drugs, nutritional products, diabetes monitoring devices, and diagnostics. February 19th the company raised its quarterly dividend 10% to $0.44/share. The cash dividend is payable May 15, 2010, to shareholders of record at the close of business on April 15, 2010. The ex-dividend date is April 13. ABT is a Dividend Aristocrat and has raised its dividend for 38 consecutive years. The yield based on the new payout is 3.24%. [Analysis]

ITT Corp (ITT) is a diversified industrial manufacturer of advanced technology products. February 22nd the company raised its quarterly dividend 18% to $0.25/share. The dividend is payable on April 1, 2010 to shareholders of record on March 3, 2010. The ex-dividend date is March 1. The dividend yield is 1.95% on the new payout.

Home Depot (HD) operates a chain of over 2,200 retail warehouse-type stores, selling a wide variety of home improvement products. February 23rd the company increased its quarterly dividend 5% to 23.625/share. The dividend is payable on March 25, 2010, to shareholders of record on the close of business on March 11, 2010. The dividend yield is 3.01% on the new payout.

Kimberly-Clark (KMB) is a leading consumer products company’s global tissue, personal care and health care brands include Huggies, Pull-Ups, Kotex, Depend, Kleenex and Scott. February 23rd the company raised its quarterly dividend 10% to $0.66/share. The dividend is payable on April 5, 2010, to stockholders of record on March 5, 2010. The ex-dividend date is March 3, 2010. KMB is a Dividend Aristocrat and has raised its dividend for 38 consecutive years. The yield based on the new payout is 4.38%. [Analysis]

MOCON (MOCO) makes equipment to test packages and packaging material, and performs consulting and analytical services. February 24th the company raised its quarterly dividend 6% to $0.095/share. The dividend is payable on May 21, 2010, to shareholders of record on May 7, 2010. The ex-dividend date is May 5, 2010. Yield on the dividend is 3.74%.

Digital Realty Trust (DLR) operates as a real estate investment trust (REIT). February 24th the company increased its quarterly dividend to $0.48/share. The dividend will be paid on March 31, 2010, to common stockholders of record as of the close of business on March 15, 2010. The ex-dividend date is March 11, 2010. Yield on the dividend is 3.76%.

Altria Group (MO) is the largest U.S. cigarette producer. February 24th the company increased its quarterly dividend 3% to $0.35/share. The dividend is payable on April 9, 2010, to stockholders of record as of March 15, 2010. The ex-dividend date is March 11, 2010. MO is a Dividend Achiever and has raised its dividend for 14 consecutive years. The yield based on the new payout is 6.91%.

Westar Energy (WR) provides electric generation, transmission and distribution services to apx. 674,000 customers in Kansas as of December 31, 2007. February 24th the company raised its quarterly dividend 3.3% to $0.31/share. The dividend is payable April 1, 2010 to shareholders of record on March 9, 2010. The ex-dividend date is March 5. The yield based on the new payout is 5.62%.

Chubb (CB) is one of the largest U.S. property-casualty insurers, Chubb has carved out a number of niches, including high-end personal lines and specialty liability lines coverage. February 24th the company increased its quarterly dividend 5.7% to $0.37/share. The dividend is payable on April 6 to shareholders of record on March 19. The ex-dividend date is March 17. CB is a Dividend Aristocrat and has raised its dividend for 45 consecutive years. The yield based on the new payout is 2.90%. [Analysis]

Weingarten Realty Investors (WRI) is a REIT focusing on shopping centers and industrial properties. February 24th the company increased its dividend. The yield based on the new payout is 4.92%.

McGrath Rentcorp (MGRC) rents and sells modular buildings and electronic test and measurement equipment; and manufactures and sells portable classrooms. February 24th the company increased its quarterly dividend to $0.225/share. The dividend is payable on April 30, 2010, to all shareholders of record on April 16, 2010. The ex-dividend date is April 14, 2010. MGRC is a Dividend Achiever and has raised its dividend for 18 consecutive years. The yield based on the new payout is 3.69%.

Essex Property Trust (ESS) is a real estate investment trust primarily owns and operates multi-family properties in California and the Pacific Northwest. February 24th the company raised its quarterly dividend to $1.0325/share. The dividend is payable on April 15, 2010 to shareholders of record as of March 31, 2010, will be $1.0325 per share. The ex-dividend date is March 29, 2010. ESS is a Dividend Achiever and has raised its dividend for 16 consecutive years. The yield based on the new payout is 4.83%.

Donaldson (DCI) operates as a worldwide manufacturer of filtration systems and replacement parts. February 24th the company increased its quarterly dividend 4% to $0.12/share. The dividend is payable March 19th to shareholders of record as of March 5th. The ex-dividend date is March 3. DCI is a Dividend Achiever and has raised its dividend for 24 consecutive years. The yield based on the new payout is 1.147%.

CenturyLink (CTL) provides voice service to 7 million customers and Internet service to 2 million customers in both rural towns and larger cities, like Las Vegas. February 25th the company raised its quarterly dividend 3.6% to $0.725/share. The dividend is payable on March 22, 2010 to shareholders of record on March 9, 2010. The ex-dividend date is March 5, 2010. CTL is a Dividend Aristocrat and has raised its dividend for 36 consecutive years. The yield based on the new payout is 8.37%.

Gap Inc. (GPS) is a specialty apparel retailer operates Gap, Banana Republic and Old Navy stores. February 25th the company increased its dividend 18% to $0.10/share. The dividend is payable on April 28, 2010 to shareholders of record at the close of business on April 7, 2010. The yield based on the new payout is 1.96%.

Old Republic Int. (ORI) writes property and liability, mortgage guaranty, title and life, and disability insurance. February 25th the company raised its quarterly dividend 1.4% to $0.1725/share. The dividend is payable March 15, 2010, to shareholders of record on March 5, 2010. Yield on the dividend is 6.1%. ORI is a Dividend Achiever and has raised its dividend for 28 consecutive years. The yield based on the new payout is 6.13%.

Cleco Corp (CNL) generates, transmits, distributes and sells electricity in Louisiana; holds ownership interest in three steam electric generating stations and one gas turbine. February 25th the company increased its quarterly dividend 11% to $0.25/share. The dividend is payable May 15, 2010. The yield based on the new payout is 3.90%.

The only way a company can consistently increase yield-on-cost is to consistently raise their dividends paid. For a list of stocks with a long string of consecutive cash dividend increases, see this list.

Full Disclosure: Long ABT, KMB, CTL. See a list of all my income holdings here.

(Photo Credit)

The 2010 Dividend Stock Ideas List *

D4L — Wed, 24 Feb 2010 11:30:53 +0000

Last year I introduced the Stock Ideas list and it has proven to be immensely popular. The list consists of Dividend Aristocrats, US Broad Dividend Achievers and U.S. Dividend Champions. Duplications in the above lists are eliminated and stocks are crossed out when I learn that they have either cut their dividend or fail to raise it. Here are some highlights on this year’s changes:

Dividend Aristocrats: Companies in the S&P 500 that have followed a policy of consistently increasing dividends every year for at least 25 consecutive years. As the name denotes, these are the best of the best – the blue blood stocks, including names like:

US Broad Dividend Achievers: Is comprised of companies incorporated in the United States or its territories, trade on the NYSE, NASDAQ or AMEX, and have increased their annual regular dividend payments for the last ten or more consecutive years. Notable names on this list include:

The U.S. Dividend Champions: Is maintained by Dave Fish of MoneyPaper. The list is updated monthly and located at the The Drip Investing Resource Center. Like the Dividend Aristocrats above the Dividend Champions list looks for companies that have increased their dividend for at least 25 consecutive years. However, since S&P 500 membership is not a requirement, the list is larger than the Dividend Aristocrats list and also includes small-cap companies.

- Bowl America (BWL.A) | Yield: 4.50%
- Conn. Water Service (CTWS) | Yield: 4.00%
- Weyco Group Inc. (WEYS) | Yield: 2.70%

Needless to say, last year saw many companies fall off the list. Overall the number of constituents fell to 218 stocks in 2010 from 319 in 2009. What made last year so unusual were the number of big-name companies that no longer qualified for inclusion on the list, some that had paid increasing dividends for decades, including:

- American International Group, Inc. (AIG)
– Bank of America Corporation (BAC)
– General Electric Co. (GE)
- The Home Depot, Inc. (HD)
- Johnson Controls Inc. (JCI)
- Pfizer Inc. (PFE)
- US Bancorp (USB)

The news wasn’t all bad. Partially offsetting the 133 companies that fell off the list were 32 new companies joining the Dividend Stock Ideas List. For the most part, these aren’t household names, not yet at least, but here are some names we will likely be seeing in the future:

- Arrow Financial Corporation (AROW) | Yield: 3.90%
- Energy Transfer Partners L.P. (ETP) | Yield: 7.80%
- Federated Investors, Inc. (FII) | Yield: 3.70%
- Getty Realty Corp. (GTY) | Yield: 8.50%
- Hudson City Bancorp, Inc. (HCBK) | Yield: 4.60%
- Investors Real Estate Trust (IRET) | Yield: 7.80%
- NSTAR (NST) | Yield: 4.60%
- Northeast Utilities (NU) | Yield: 3.80%
- Plains All American Pipeline LP (PAA) | Yield: 6.80%
- Suburban Propane Partners LP (SPH) | Yield: 7.30%

You can see the entire Dividend Stock Idea List here. Remember, not every stock listed here is a great dividend investment, but virtually all great dividend investments are on this list.

Full Disclosure: Long CLX, KO, EMR, JNJ, MCD, PG, WMT, CVX, NUE. See a list of all my income holdings here.

(Photo Credit)

Seven Stingy Dividend Stocks *

D4L — Wed, 26 Aug 2009 10:30:34 +0000

I currently track 100 dividend stocks in my D4L-Dashboard and have determined some of the lower rated stocks could be buys if the companies simply chose to increase their dividends. For various reasons their management has elected keep a low payout ratio and deploy the excess cash elsewhere.

To identify these stingy companies, I used the following criteria on the companies I track:

A Free Cash Flow Dividend Payout (FCFp) of 40% or less. This means that 60% of the company’s cash, after operating expenses, is going elsewhere.
A sum of Debt to Total Capital (Debt) + FCFp of less than 50%. This should help weed out the companies holding the cash to pay interest.
Trailing 12-month Free Cash Flow per share is greater than an average of the last 3 years. This weeds out companies where cash flow is decreasing.
Cash on the balance sheet in excess of short-term debt. This weeds out companies that may have an immediate debt-servicing need for the cash.

Here are seven stocks out of the 100 that I track meeting the above criteria:

Aflac Incorporated (AFL) – 4-Stars – Analysis
Aflac Incorporated engages in the marketing and sale of supplemental health and life insurance plans in the United States and Japan.

FCF Payout: 10%
Debt + FCFp: 34%
Cash/ST Debt: 11.5 Times

C.R. Bard Inc. (BCR) – 4-Stars
Bard (C.R.) Inc is a diversified producer of therapeutic and diagnostic medical devices has exposure to the vascular, urology, oncology, and specialty surgical markets.

FCF Payout: 13%
Debt + FCFp: 19%
Cash/ST Debt: No ST Debt (4.1 Times LT Debt)

Franklin Resources Inc. (BEN) – 2 Stars
Franklin Resources Inc. is one of the world’s largest asset managers, serving retail, institutional and high-net-worth clients.

FCF Payout: 17%
Debt + FCFp: 31%
Cash/ST Debt: 91.2 Times

Donaldson Company (DCI) – 3 Stars – Analysis
Donaldson Company operates as a worldwide manufacturer of filtration systems and replacement parts.

FCF Payout: 17%
Debt + FCFp: 49%
Cash/ST Debt: 1.6 Times

General Dynamics (GD) – 2 Stars – Analysis
General Dynamics is the world’s sixth largest military contractor and also one of the world’s biggest makers of corporate jets.

FCF Payout: 25%
Debt + FCFp: 48%
Cash/ST Debt: 1.2 Times

Lancaster Colony (LANC) – 2 Stars
Lancaster Colony is a diversified Ohio-based company manufactures and markets consumer products; glassware and candles; and automotive accessories.

FCF Payout: 25%
Debt + FCFp: 29%
Cash/ST Debt: No ST Debt (1.3 Times LT Debt)

Walgreen Co. (WAG) – 3 Stars – Analysis
Walgreen Co is the largest U.S. retail drug chain in terms of revenues. It sells prescription and non-prescription drugs, beauty care, personal care, household items, candy, photofinishing, greeting cards, seasonal items and convenience foods.

FCF Payout: 28%
Debt + FCFp: 42%
Cash/ST Debt: 230 Times

You could view this from a positive perspective and say the above dividends should be very safe and the companies are in an excellent position to continue to raising them each year. In dividend investing, cash is king, but at some point management has to be willing to share it with the company’s owners.

Full Disclosure: Long AFL. See a list of all my income holdings here.

The Best Dividend Stocks In The World *

D4L — Wed, 11 Feb 2009 11:30:33 +0000

I couldn’t begin to estimate how many different stocks are traded around the world on the various exchanges. Like everything else, there are many participants, but few players. Though the population of stocks may be large, there are only a precious few that are worthy dividend stocks. When spending my time looking for worthy investments, there are four primary places I look:

I. S&P 500 Dividend Aristocrats

These stocks are the best of the best – the blue blood stocks. S&P maintains the list. Here is a description from their site:

S&P 500 Dividend Aristocrats is designed to measure the performance of S&P 500 index constituents that have followed a policy of consistently increasing dividends every year for at least 25 consecutive years. This index is a member of the S&P Dividend Aristocrats index series.

Index constituents exhibit the following characteristics:

Underlying Indices – S&P 500

Weighting – Equally weighted; Constituents re-weighted quarterly

Reconstitution – Reviewed annually in December

Members may be deleted during the December rebalance if calendar-year dividends did not increase from the previous year, or intra-year if the stock is removed from the underlying S&P 500.

Among others, Dividend Aristocrats include these highly recognizable names:

Clorox Co (CLX)
Coca-Cola Co (KO)
Exxon Mobil (XOM)
Johnson & Johnson (JNJ)
McDonald’s Corp (MCD)
Procter & Gamble (PG)
Wal-Mart Stores (WMT)

II. US Broad Dividend Achievers™ Index

This index is maintained by Idxis. Here is the description from their website:

The Broad Dividend Achievers™ Index is comprised of companies incorporated in the United States or its territories, trade on the NYSE, NASDAQ or AMEX, and have increased their annual regular dividend payments for the last ten or more consecutive years. In addition, Indxis requires that a stock’s average daily cash volume exceed $500,000 per day in the November and December prior to the annual reconstitution date on the last trading date in January. The Index is calculated using a modified market capitalization weighting methodology and has been published by the American Stock Exchange under the ticker symbol DAA since December 5, 2003.

Select US companies with at least ten consecutive years of increasing regular dividends. US companies must be listed on the NYSE, AMEX or NASDAQ. US Companies must have a minimum average daily cash volume of US$500,000 per day for the November and December prior to each Annual Reconstitution Date.

Here are several prominent companies that are Dividend Achievers:

Chevron Corporation (CVX)
Donaldson Company (DCI)
McCormick & Co. (MKC)
Wells Fargo & Co. (WFC)

III. International Dividend Achievers™ Index

This index is maintained by Idxis. Here is the description from their website:

The International Dividend Achievers™ Index is designed to track the performance of dividend paying American Depositary Receipts and foreign common stocks trading on major US exchanges. To become eligible for inclusion in the International Dividend Achievers Index a stock must be incorporated outside the United States, trade on the NYSE, NASDAQ or AMEX, and have increased its annual regular dividend payments for the last five or more consecutive years. In addition, Indxis requires that a stock’s average daily cash volume exceed $500,000 per day in November and December prior to each annual reconstitution in January. The Index is calculated using a dividend yield weighting methodology and is calculated by American Stock Exchange under the symbol DAT since August 1, 2005.

To become eligible for inclusion, a company must be incorporated outside of the United States. The companies must be have an American Depository Receipt or common stock trading on NYSE, NASDAQ or AMEX. Companies must have paid increasing regular annual dividends for five or more consecutive years. The average daily cash volume must exceed $500,000 in US$ in the November and December prior to reconstitution.

The International Dividend Achievers are filled with companies that touch our lives on a daily basis including:

Toyota Motor Corp. (TM)
Panasonic Corp (PC)
Nokia Corp. (NOK)
BP p.l.c. (BP)
Canadian National Railway Company (CNI)

IV. The U.S. Dividend Champions

This list is maintained by Dave Fish of MoneyPaper is regularly updated and located at the The Drip Investing Resource Center. Here is a description from the spreadsheet:

The initial goal was to identify companies that had increased their dividend for at least 25 consecutive years, but, as explained below, the definition was broadened to include additional companies that had paid higher dividends without having increased the quarterly payout in every calendar year. I also decided to follow companies that had increased their dividend for 20-24 straight years, since they are likely to join the 25-year “Champions” soon. It was also necessary to resolve discrepancies between the streak claimed by the company and information from outside sources, which is why the “(Per Company)” sub-title is included.

All the U.S. Dividend Champions names may not be as familiar, but it includes some smaller companies not found on the other lists such as:

Florida Public Utilities (FPU)
Bowl America (BWL.A)
Middlesex Water Co. (MSEX)
Telephone & Data Sys. (TDS)
Weyco Group Inc. (WEYS)

Bringing It All Together

The above four lists contain a significant number of companies, and unfortunately a great deal of duplication. I am in the process of building a single list that eliminates the multiple entries for the same company. It is my goal to eventually have a minimum amount of analysis on each company. To that end, I have posted an aggregated list as Stock Ideas under the Analysis section. It is still very rough around the edges, but keep checking in, it will get better as time passes.

Not every stock listed is a great dividend investment, but virtually all great dividend investments are on the list.

Full Disclosure: Long BP, CLX, CNI, CVX, JNJ, KO, MCD, PG, WMT

(Photo: ilker)

Stock Analysis: Donaldson Company, Inc (DCI) *

D4L — Mon, 15 Dec 2008 11:30:00 +0000

This article originally appeared on The DIV-Net December 8, 2008.

Linked here is a PDF copy of my detailed analysis of Donaldson Company, Inc (DCI). Below are some highlights from the above linked analysis:

Company Description: Donaldson Company operates as a worldwide manufacturer of filtration systems and replacement parts.

Fair Value: I consider four calculations of fair value, see page 2 of the linked PDF for a detailed description:

Avg. High Yield Price
20-Year DCF Price
Avg. P/E Price
Graham Number

DCI is trading at a discount to 1.), 2.) and 3.) above. If I exclude the high and low valuations and average the remaining two, DCI is trading at a 21.1% discount. DCI earned a Star in this section since it is trading at a fair value.

Dividend Analytical Data: In this section I consider five factors, see page 2 of the linked PDF for a detailed description:

Rolling 4-yr Div. > 15%
Dividend Growth Rate
Years of Div. Growth
1-Yr. > 5-Yr Growth
Payout 15% of avg.

DCI earned three Stars in this section for 1.), 2.) and 3.) above. Rolling 4-yr Div. > 15% means that dividends grew on average in excess of 15% for each consecutive 4 year period over the last 10 years (1999-2002, 2000-2003, 2001-2004, etc.) I consider this a key metric since dividends will double every 5 years if they grow by 15%. DCI has paid a cash dividend to shareholders every year since 1956 and has increased its dividend payments for 21 consecutive years.

Dividend Income vs. MMA: Why would you assume the equity risk and invest in a dividend stock if you could earn a better return in a much less risky money market account (MMA)? This section compares the earning ability of this stock with a high yield MMA. Two items are considered in this section, see page 2 of the linked PDF for a detailed description:

NPV MMA Diff.
Years to >MMA

DCI earned no Stars in this section. The NPV MMA Diff. of the $109 is below the $7,500 minimum I look for in a stock that has increased dividends as long as DCI has. If DCI grows its dividend at 15.0% per year, it will take 15 years to equal the cumulative earnings from a MMA yielding an estimated 20-year average rate of 4.61%. The 15 years is more than the 10 years maximum I like to see.

Other: DCI is a member of the Broad Dividend Achievers™ Index. At the end of November, DCI lowered its fiscal 2009 earnings outlook, anticipating a stronger dollar and possibly weaker demand. The company, which has benefited for several years from the weak dollar, adjusted its full-year outlook “due to the combination of exchange rates and weaker customer demand.”DCI also reported an 11 percent increase in net income for its fiscal first quarter, outpacing Wall Street expectations on the strength of its aerospace and defense, industrial and gas turbine businesses.

Conclusion: DCI earned one Star in the Fair Value section, earned three Stars in the Dividend Analytical Data section and did not earn any Stars in the Dividend Income vs. MMA section for a net total of four Stars. This quantitatively ranks DCI as a 4 Star-Buy.

Using my D4L-PreScreen.xls model, I determined the share price would need to decrease to $20.00 for DCI’s NPV MMA Differential to hit the $7,500 that I like to see. At that price the stock would yield 2.27%.

Resetting the D4L-PreScreen.xls model and solving for the dividend growth rate needed to generate the $7,500 NPV MMA Differential I’m looking for, the calculated rate is 19.6%. This dividend growth rate is significantly above the 15.0% used in this analysis.

DCI is an interesting stock as a potential value investment. However, the numbers don’t add up as a dividend investment. For additional information, including DCI’s dividend history, please refer to its data page.

Disclaimer: Material presented here is for informational purposes only. The above quantitative stock analysis, including the Star rating, is mechanically calculated and is based on historical information. The analysis assumes the stock will perform in the future as it has in the past. This is generally never true. Before buying or selling any stock you should do your own research and reach your own conclusion. See my Disclaimer for more information.

Full Disclosure: At the time of this writing, I held no position in DCI (0.0% of my Income Portfolio) .

What are your thoughts on DCI?

NIKE (NKE), Donaldson (DCI), Hormel (HRL), McCormick (MKC) and Others Increase Dividends *

D4L — Fri, 28 Nov 2008 11:30:00 +0000

Dividend investing in the classic implementation focuses on identifying solid companies with a record of growing their dividends each year; and an expectation that it will continue into the future. The focus is not solely on yield but a combination of yield and dividend growth. Often it is the lower yield, higher growth, security that will provide the best return over time.

Here are several stocks living up to shareholders’ expectations by raising their cash dividends:

NIKE (NKE) Boosts Dividend by 8.7% to $0.25/share (2.07%)
Donaldson (DCI) Boosts Qtr. Dividend 5% to $0.115/share (1.53%)
South Jersey Industries (SJI) Raises Dividend 10% to $0.2975/share (3.11%)
United Bankshares (UBSI) Increases Dividend 3% to $0.29/share (3.41%)
Hormel Foods (HRL) Raises Annual Dividend 2.6% to $0.76/share (2.89%)
Becton, Dickinson and Company (BDX) Boosts Qtr. Dividend by 15.8% to $0.33/share (2.08%)
RGC Resources (RGCO) Increases Dividend by 10% to $0.32/share (4.97%)
The York Water Company’s (YORW) Boosts Qtr. Dividend by 4.1% to $0.126/share(4.48%)
McCormick & Company (MKC) Boosts Dividend 9% to $0.24/share (3.23%)
Landauer (LDR) Increases Dividend 5% to $0.525/share (3.47%)

After running these companies through my D4L-PreScreen.xls model, DCI and BDX, both Dividend Achievers, had NPV of MMA Differentials close enough to earn a more complete evaluation. HRL, MKC and LDR had positive NPV of MMA Differentials, but below the level required level for a more detailed evaluation. None of the others warranted additional consideration.

Disclosure: No position in the aforementioned stocks.

(Photo: Steve Woods)

Donaldson Company, Inc (DCI)

D4L — Mon, 01 Oct 2007 11:30:17 +0000

Description: Donaldson Company is a member of the Broad Dividend Achievers™ Index. The company operates as a worldwide manufacturer of filtration systems and replacement parts.

Quantitative Stock Analysis: Updated: 2-21-2009
DCI-Analysis.PDF

Share Data:

Click here for full page view.
Click the Dividends tab above to see historical dividend information.

Comments: Updated: 2-21-2009
At the end of November, DCI lowered its fiscal 2009 earnings outlook, anticipating a stronger dollar and possibly weaker demand. The company, which has benefited for several years from the weak dollar, adjusted its full-year outlook “due to the combination of exchange rates and weaker customer demand.”DCI also reported an 11 percent increase in net income for its fiscal first quarter, outpacing Wall Street expectations on the strength of its aerospace and defense, industrial and gas turbine businesses.

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