Value Investing News

I was amazed to find several companies on the champions list, which have raised distributions for over 50 consecutive years. The companies include:

The dividend aristocrats list includes companies which have increased dividends for over 25 years in a row. It is equally weighted and re-balanced once an year. Over the past 3,5 and 7 years the index of elite dividend stocks has managed to outperform the S&P 500 by 5%, 3.7% and 4.40% respectively.

We all want to succeed in everything that we do, including investing in the stock market. Though I have no analytical data to back it up, I am convinced that most people will lose money in the stock market over their lifetime. So why do so few people succeed at investing?

The Dividend Aristocrats index measures the performance of S&P 500 index members that have followed a policy of consistently increasing dividends every year for at least 25 consecutive years. (Source: S&P)

Since its inception 20 years ago, the dividend aristocrat’s index has outperformed the S&P 500.

Most companies use debt for a variety of reasons in their operations. It could be either short term or long-term obligations. If there’s anything the 2007-2009 financial crisis has taught us, it is that excessively leveraged companies could easily blow up after a chain of negative events. Thus it pays to know what the debt situation for a particular company you are investing in actually is.

A few weeks ago, a friend of mine sent me a spreadsheet he had downloaded from The Drip Investing Resource Center. The spreadsheet was titled U.S. Dividend Champions. Opening it, I found the names of 109 companies, all of whom had increased their dividends year over year for at least the past 25 years, and in one case, year over year for the past 56 years!

One of the many reasons I like dividend stocks is because they provide continuous feedback. As time passes, dividend investors see their income grow steadily. Each dividend and dividend increase provides reassurance that the strategy is working.

I have selected several prominent dividend growth stocks, whose earnings and cash flows provide adequate coverage for their dividends:

A question I often get is, “What do you think of the market? Where’s it headed?” Normally, I politely respond as expected, but occasionally I will startle the person with a reply like, “I don’t know. For me it really doesn’t matter much.” My investing goals are not defined by movements in the market.

Ever since the markets hit a milti year low in March, investors have been wondering how sustainable the advance is. Some claim that the bear market is over, while others believe that the worst is yet to come in the grand scheme of events.

Two more dividend aristocrats raised their distributions last week, bringing the total number of raisers in the elite index to 30. This is quite impressive, given the fact that there are almost 5 more months to go before the year is out and that there are only 51 components in it.

My grandmother once made the statement, “Everyone I know is either dead, or dying.” Everyone I knew was either getting married or having kids. Contrary to the perception from popular media, not all companies are cutting dividends, many are still raising them, and some are starting a new dividends.

The buy-and-hold investment strategy has taken a lot of abuse since the market turned down. But this isn’t the first time it has happened. Eventually, the market turns, the naysayers disappear and the buy-and-hold investors make a lot of money.

ModernGraham takes a look at Dover Corporation. Includes Buffett-style Business and Management Review along with a link to the Graham-style quantitative analysis.

Dover Corp. manufactures a broad range of specialized industrial products and sophisticated manufacturing equipment. Linked here is a detailed analysis and commentary.