Value Investing News

Ned Davis Research examined the relative performances of stocks between 1972 and 2006 and established a link between rising dividends and superior long-term returns. The study found S&P 500 stocks that consistently increased their dividends returned 10.4% total return (dividends + share price appreciation), while those that did not increase their dividends returned only 8.2%.

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The Basic Materials Sector includes companies involved with the discovery, development and processing of raw materials. This week week, I screened my dividend growth stocks database for Basic Materials companies with a yield above 3.0% and that have increased their dividends for at least 20 consecutive years. The results are presented below:

The Industrials Sector is one of the largest sectors in my dividend growth database. Of the 209 stocks that I track, it currently is represented by 44 stocks (21%). This is not a sector I am in a position to buy often, but when the time is right, I plan on taking full advantage of the opportunity.

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A photograph captures a moment in time. Seconds after the flash dims a tree could have fallen on the object of the photo or the sad looking man in the photo could have been told he just won a million dollars.

This is the third installment in a multi-part series that looks at different sectors that have traditionally been very friendly to dividend investors. Last week we looked at Financial Services Sector. This week we are looking at Industrial Materials…

In one form or another, I get the this question, “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.

Exchange traded funds (ETFs) and closed-end funds (CEFs) are composed of many different individual securities. This usually results in uneven dividend distributions. Some funds have tried to address this with a managed distribution policy. In short, a managed distribution policy is management’s commitment to make a fixed periodic dividend payment.

As a dividend growth investor, two of the best dividend lists for further research that I have focused on have been the S&P Dividend Aristocrats and the Dividend Achievers Indexes.

In the past we have looked at the importance of a company’s ability to sustain its dividend. However, as an investor in dividend growth stocks, it is not enough to simply sustain the dividend – I want to own companies that are capable of sustained dividend growth. Needless to say, this is a little more difficult to evaluate, but here are few important things to consider…

In my dividend database, I track nearly 190 stocks in 19 different sectors. Generally, the characteristics of certain sectors tend to match those that dividend growth investors are looking for, thus their constituents are often make better dividend investments. In the case of the stocks I track, nearly half of them are in these three sectors:

The goals of an income portfolio are much different than those of a capital appreciation portfolio. The good news is an income portfolio consisting of quality dividend growth stocks can not only succeed, but excel during a market downturn. Dividend investors are focused on building a stream of steadily rising income from solid companies.

RPM International Inc. makes specialty coatings and products for the structural waterproofing and corrosion control markets, as well as products for the consumer, do-it-yourself and hobby markets. Linked here is a detailed analysis and commentary.

To succeed as a dividend growth investor you must identify and purchase stocks with sustainable dividend growth. Put another way, targeted companies must be both capable and willing to grow their dividends. Obviously, we can not look into the future and see who will and will not perform.

Ned Davis Research examined the relative performances of stocks between 1972 and 2006 and established a link between rising dividends and superior long-term returns. The study found S&P 500 stocks that consistently increased their dividends produced total returns (dividends + share price greater than those that did not increase their dividends.

Virtually everything in this world can be placed into a few basic categories. This is especially true for Dividend Stocks when looking at their historic performance and expectations for the future.