Dividend Raises & Cuts for September 2016

Dividend growth investing is a popular model followed by the investing community to build assets. As part of my ongoing commitment to keep track dividend raises and cuts in the business world, I compile and share this list publicly. Start of each month, I also profile the top raises and cuts and profile the companies.

Note that only $2B+ (Midcap+) companies are included in this list.

Dividend raises were noted from companies such as: Campbell Soup Co (CPB), Verizon Communications Inc (VZ), Phillip Morris International Inc (PM), Royal Caribbean Cruises (RCL), Microsoft Corp (MSFT), Lockheed Martin Corp (LMT), American Express Co (AXP), Realty Income Corp (O), McDonald’s Corp (MCD) and many more. Top raises came from InterDigital Inc (IDCC), Goodyear Tire & Rubber Co (GT), Royal Caribbean Cruises (RCL), and CLARCOR Inc (CLC). Dividend Cuts were announced by Viacom Inc (VIA), Plains All American Pipeline L.P. (PAA) and Plains GP Holdings L.P. (PAGP).

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Where to Get Good Dividend Investment Ideas

This is a guest contribution from Ben Reynolds.  Ben runs Sure Dividend, which is dedicated to finding high quality dividend growth stocks suitable for long-term investing using The 8 Rules of Dividend Investing.

The historical average price-to-earnings ratio for the S&P 500 is 15.6.  The S&P 500’s current price-to-earnings ratio is 24.2.  From a historical perspective, the market is very clearly overvalued.

It’s important to remember that the stock market is made up of individual stocks.  Not every member of the S&P 500 has a price-to-earnings ratio of 24.2.  Some are much higher, others much lower.

It is still possible to find great businesses trading at fair or better prices in today’s market.  This article takes a look at several different tools and lists to do just that.

Dividend Idea Generator #1:  Other Dividend Investors Portfolios

Many dividend bloggers share their own portfolios for others to view.  You can see Sabeel’s portfolio here (of Roadmap 2 Retire).  Sabeel’s portfolio is loaded with both high yield and high quality dividend growth stocks.

An example is Archer-Daniels-Midland (ADM).  Archer-Daniels-Midland currently has a dividend yield of 2.9% and price-to-earnings ratio of 16.1.  The company’s forward price-to-earnings ratio is even lower at 14.3.

Archer-Daniels-Midland is a has paid increasing dividends for 41 consecutive.  The company is also the largest farm procucts company in North America by a wide margin with its $24.8 billion market cap.  For comparison, its next largest competitor Bunge (BG) has a market cap of $8.2 billion.

You can read more about Sabeel’s purchase of Archer-Daniels-Midland here.

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Multipronged Approach to Investing

I love Dividend Growth Investing. The main focus of my investing approach over the course of past few years has been Dividend Growth Investing. I am happy to subscribe to this model and still highly recommend it for investors looking for a reliable method of generating passive income. However, over the course of last year or so – as the bull market rages on in old age, valuations have been pushed to stratospheric levels amid the falling profits from strong blue chip companies. It is for this reason, I have decided to pursue a more multi-pronged approach to investing.

Regular readers of this blog may have noticed the change in my tone of the course of the past few months…I do not feel so hot about this market and the amount of purchases have dried up and my cash position has been building up steadily. Apart from a few pockets of companies, its become very hard to find compelling buys in this market as the debt-fueled share repurchase programs have made me question investing in certain companies.

Multipronged Approach to Investing

Strategy Falling in love with one single investment (or even an investment strategy) is not a very prudent behavior as an investor. Readers may be aware that we are already using a couple of different investing strategies in our portfolios. My wife’s portfolio uses a more passive approach to investing – using broad index funds via ETFs. My portfolio, on the other hand, focuses mainly on dividend growth investing and starting this month, a part of it will also be invested in index funds. This is a good diversification model. With dividend growth companies, I target some companies which I think will do well compared to its peers and let the investments compound over time. With the index funds, I let the market do what it does best; and allows me to instantly diversify providing me with a safety net, in case I had made a terrible mistake with my individual stock picks.

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Why I Chose Dividend Growth Investing

Hi all,

I was invited to guest post at dividendgrowthinvestor.com. DGI is one of the first bloggers I followed about a decade ago that convinced me on following the path to dividend growth investing to achieve financial independence; and it was an honor to be invited. Thanks again for the opportunity, DGI! 🙂

In this article, I introduce readers to some of the mistakes I made early in my investing career and how I discovered dividend growth investing. I also highlight a few advantages that come with this investing model. Be sure to check it out.

You can find the post here >



Canadian Stocks to DRIP

Canadian Stocks to DRIP

Recently, while discussing dividend investing with a friend, the topic of DRIP (dividend reinvestment plan), specifically synthetic-DRIPs, came up on Canadian companies. Both he and I invest in companies through a discount broker, which does not support full DRIP and the discussion revolved around total investment dollars needed to DRIP in each company. This gave me an idea to compile the Canadian Dividend All-Star list of companies to see how much one needs to invest to achieve synthetic DRIP.

Note that this exercise is merely meant to be a resource that I am sharing and a company at either end of the scale may or may not be the best investment. Investors are recommended to perform due diligence before investing in any of the companies.

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