Thursday, December 8, 2016

Procter & Gamble (PG) Dividend Stock Analysis 2016

The Procter & Gamble Company (NYSE:PG), together with its subsidiaries, manufactures and sells branded consumer packaged goods. The company operates through five segments: Beauty, Grooming, Health Care, Fabric Care and Home Care, and Baby Care and Family Care. This dividend king has paid dividends since 1891 and has managed to increase them for 60 years in a row.

The company's latest dividend increase was announced in April 2016 when the Board of Directors approved a 1% increase in the quarterly dividend to 66.95 cents /share. The company's peer group includes Colgate-Palmolive (NYSE:CL), Kimberly-Clark (NYSE:KMB) and Unilever (NYSE:UL)

Over the past decade this dividend growth stock has delivered an annualized total return of 6%/year to its shareholders.

The company has managed to deliver an anemic 2.80% average increase in annual EPS over the past decade. Procter & Gamble is expected to earn $3.89 per share in 2017 and $4.21 per share in 2018. In comparison, the company earned $3.49/share in 2016.

Monday, December 5, 2016

Five Consistent Dividend Payers Raising Distributions to Shareholders

Each week, I go through the list of dividend increases in order to monitor performance of existing holdings, and uncover hidden dividend gems. I then narrow down the list by eliminating companies with a short dividend growth streak. I also look at things like trends in earnings per share, dividends per share, dividend payout ratios, in order to determine the likelihood of future dividend growth and growth in intrinsic value. My basic analysis also focuses on valuation and dividend sustainability.

Over the past week, there were five dividend stocks with a long streak of consecutive annual dividend increases, which raised dividends to shareholders. The companies include:

McCormick & Company, Incorporated (MKC) manufactures, markets, and distributes spices, seasoning mixes, condiments, and other flavorful products to the food industry. It operates through two segments, Consumer and Industrial. The company raised its quarterly dividend by 9.30% to 47 cents/share. This dividend champion has rewarded shareholders with a dividend raise for the past 31 years in a row. Over the past decade, McCormick has raised dividends at a rate of 9.60%/year. This quality company is selling at 23.50 times forward earnings and yields 2.10%. I would be interested in adding to my position in this compounding machine on dips below $76/share. Check my analysis of McCormick for more information about the company.

Friday, December 2, 2016

The best asset class to hold in retirement accounts

Regular readers know that I have assets held in taxable and non-taxable accounts.

Taxable account provide me with more flexibility in the range of investments I can select, and ease of accessing my money at a moments notice. However, I have to pay taxes on dividends and realized capital gains.

Non-taxable accounts ( also referred to as tax-deferred or retirement accounts) allow me to defer paying taxes on investments I have made. These retirement accounts come in all shapes and forms, but generally they allow me to defer paying taxes anywhere from a few decades to indefinitely. Taking money out of them is generally more difficult. It is not impossible however, and worth it, if you are willing to do some planning that will shave years off your journey towards financial independence. This is also not an issue for me, because I am a long-term investor and my investment money is not going to all be needed in a lump sum right away.

I have started to ask myself how to optimize my portfolio better. Deciding which assets belong in taxable accounts, and which belong in retirement accounts is one decision that would help me achieve a more optimized result (translation: more money). I want to make sure I am making the best long term asset placement for my portfolio.

Wednesday, November 30, 2016

The Walt Disney Company (DIS) Dividend Stock Analysis

The Walt Disney Company (NYSE:DIS) operates as an entertainment company worldwide. The company operates in five segments: Media Networks, Parks and Resorts, Studio Entertainment, Consumer Products, and Interactive. The company is not a typical dividend growth stock, although it has paid dividends since 1957, and has never cut them. Disney is a dividend angel which often raises dividends several years in a row, after which it keeps them unchanged. This is followed by another round of dividend raises again.

The most recent dividend increase was in December 2015, when the Board of Directors approved a 7.60% increase in the semi-annual dividend to 71 cents/share. The largest competitors for Disney include Time Warner (NYSE:TWX), Viacom (NYSE:VIA) and Twenty-First Century Fox (NASDAQ:FOXA).

Over the past decade the stock has delivered an annualized total return of 13.20% to its shareholders. Future returns will be dependent on growth in earnings and dividend yields obtained by shareholders.

Monday, November 28, 2016

Six Dividend Stocks Sending More Cash to Shareholders

Each week I review the list of dividend increases. This is helpful in monitoring existing dividend holdings, and monitoring the breadth of dividend increases across the universe of prominent dividend growth stocks. Dividend increases also provide a proxy for near term expectations for the performance of the underlying businesses. If management continues raising dividends at the same rate as before, without achieving that through increases in the payout ratio, this indicates that they are expecting continued success in the business. If management raises dividends slower than expected, this might be an indication that things are slowing down.

Regular readers know that dividend increases are just one of the things I look for in evaluating companies. I am looking for a company with a strong track record of annual dividend growth, which is supported by growth in earnings per share. If such a company is available at an attractive valuation, it should be analyzed in detail, before being considered for my dividend growth portfolio.

Over the past week, there were six companies that met my minimum requirement for annual dividend increases. The companies include:

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