Saturday, May 25, 2019

Dividend Growth Investor Newsletter Memorial Day Sale

Last year, I started a premium newsletter focusing on providing more actionable content for subscribers. I launched this service, particularly to address a common question I receive quite often from readers. Many readers ask either for a summary of my best ideas or for a listing of my dividend portfolio holdings.

One of the challenges I have is that I would not recommend purchasing many of the companies I own today due to valuation. However, I think that my newsletter addresses the need for a snapshot of dividend holdings for the long-term and a list of attractively valued companies that the portfolio will purchase each month.

In my newsletter, I run an actual dividend portfolio with real money. I invest every single month in the best values I can find at the moment. I allocate $1,000 per month to the portfolio. Each month, I try to invest in 10 blue chip dividend companies using the commission free brokerage Robinhood.

Each newsletter includes the ten companies I plan to buy for the Dividend Growth Portfolio. I try to provide more than just a list of companies I am buying however. You will be able to obtain an analysis of each company included in the portfolio through the newsletter. In my analysis, I will focus on dividend safety, dividend growth potential and valuation. I try to invest that money with utmost care, because I know that I will rely on that dividend income stream in the future. As the dividend portfolio matures, I will walk you through the process of managing portfolio weights, working on diversification and monitoring the portfolio.

The newsletter with ten dividend ideas comes out on the last Sunday of every month. The next newsletter comes out on May 26th. The orders will be executed at the open on Tuesday morning. Subscribers will receive confirmation about the purchases that are made in a follow up email later that day.

Each month, I also include a brief overview of the portfolio performance. The ultimate goal of this portfolio will be to generate $1,000 in safe monthly dividend income. Therefore, I have the commitment to stick to this portfolio for a few years.

Dividends are reinvested in the best values at the moment. They are pooled with the new cash deposits into the brokerage account. Once dividends earned in a given month reach $100 however, I may make investment decisions on an ad-hoc basis if I find a good value for the money that is short-lived. Subscribers will receive alerts for any real time trades made for the portfolio.

In order to thank you for being a loyal reader, I am offering the newsletter for a low introductory price of $65/year, which is valid through May 31, 2019. Starting June 1, the price will go up to $79/year.

There is a 7 day free trial, during which your card will not be charged. After that, you can still cancel at any time, but you will be charged. For less than 20 cents/day, you will receive a listing of 10 quality companies that my real world portfolio will purchase every month. I believe that this is a bargain.

You can sign up below:





Once you subscribe, I will add you to my exclusive email list, and you will be able to receive premium information about the dividend growth investor portfolio.

You will receive the last newsletter from April 2019 upon signing up. The next newsletter will be sent out on May 26. I plan to provide an updated list of Dividend Portfolio Holdings by June 2.

The price will increase on June 1 to $79/year, so you have a limited chance to grab this limited time promotion today. If you subscribe today, your price will never increase. I guarantee it.


Thursday, May 23, 2019

3M (MMM) Dividend Stock Analysis

3M Company (MMM) operates as a diversified technology company worldwide, which operates in five segments: Industrial, Safety and Graphics, Health Care, Electronics and Energy, and Consumer segments. This analysis was shared with subscribers to my Dividend Portfolio Newsletter earlier last week.

3M is a dividend king with a 61-year record of annual dividend increases. The company raised its quarterly dividend by 5.90% to $1.44/share in January 2019.

The company has managed to deliver a 4.30% average increase in annual EPS since 2007. 3M is expected to earn somewhere between $9.25 and $9.75/share in 2019. In comparison, the company earned $8.89/share in 2018.


The strength of 3M’s business model is largely driven by three key strategic levers: active portfolio management, investing in innovation, and business transformation. Management believes that these levers, combined with more aggressive capital deployment, will drive enhanced value creation. Over the last several years 3M has taken significant actions to strengthen its technology capabilities, improve portfolio and cost structure, and make the company even more relevant to customers. 3M’s technology platforms and its manufacturing scale allow it to achieve the lowest unit cost in most of the categories in which 3M competes. This also ensures high margins as well.

The first lever – Portfolio Management – is increasing customer relevance and allowing 3M to focus on its most profitable and fastest-growing businesses. 3M has realigned from 40 businesses to 24 over the past five years. This has resulted in SG&A savings of around $250 million. Continued portfolio management will also help to optimize its footprint, and the company is targeting $125 million to $175 million in additional operational savings by 2020. The company is also expecting that acquisitions, net of divestitures will result in a net 1% growth in annual sales over time. Portfolio management is strengthening 3M’s competitiveness and making them even more relevant to our customers and the marketplace.

Investing in Innovation is the second lever. 3M plans to increase investments in research and development to about 6 percent of sales. The company spends over 6% of revenues on R&D, and has been able to discover innovative products to bolster its bottom line. 3M also allows it engineers to spend 15% of their time on their own projects, which has resulted in a lot of innovation. The company has a proven track record of making money on its research dollars spent, as it tries to find applications with a customer centric point of view. The company invests in research and development to support organic growth, and enhance the company’s strong margins and return on invested capital.

3M continues to make good progress on its third lever – Business Transformation – which is enabling the company to better serve customers with even more agility and efficiency. Its Business Transformation lever aims to creating value for the company and its customers. By 2020, this initiative is expected to deliver $500 to $700 million in annual operational savings, and an additional $500 million reduction in working capital.

The company is also focusing on investments in priority growth platforms such as auto electrification, air quality and personal safety. The company is also focusing investments on its strong global business model including in the U.S. and China.

Recently, the stock has been battered, after it missed earnings and revenue projections. 3M cut EPS guidance to $9.25-$9.75 from $10.45-$10.90 previously. The company is also trying to cut costs by eliminating 2,000 positions, which could likely save almost a quarter of a billion per year. I am not going to extrapolate this bad quarter onto the future and would see further declines as an opportunity to add on further weakness.

Earnings per share have also been aided by share buybacks. The number of shares outstanding has decreased from 732 million in 2007 to 602 million by 2018.


The annual dividend payment has increased by 10.50% per year over the past decade, which is higher than the growth in EPS. Future rates of growth in dividends will be limited to the rate of growth in earnings per share.



For more than a century the strings of 3M business model has enabled the company to invest in the business while also returning cash to our shareholders. All of this has included a strong steady and rising dividend which is management sees as the hallmark of the enterprise.

In the past decade, the dividend payout ratio has increased from 34% in 2007 to 61% in 2018. I believe that 3M's dividend is safe. A lower payout is always a plus, since it leaves room for consistent dividend growth minimizing the impact of short-term fluctuations in earnings.


Currently, 3M is fairly valued at 17.60 times forward earnings and has a current yield of 3.40%. This quality company may be worth a second look in the $185 - $195/share range and may be even more interesting to me if it further dips from there.

Relevant Articles:

Dividend Kings List For 2019
Dividends versus Share Buybacks/Stock repurchases
What drives future investment returns?
Twelve Companies Raising Dividends To Their Investors

Monday, May 20, 2019

Five Dividend Stocks Rewarding Shareholders With Raises

Last week, there were five dividend growth companies which increased distributions to their shareholders. Each of these companies has managed to grow distributions for at least ten consecutive years. I reviewed the most recent increase in dividends relative to the historical average. I also reviewed trends in earnings per share, in order to determine the likelihood of future dividend increases. In addition, I also reviewed valuation, in order to determine if a company is worth pursuing today, or it may be a better deal at a better price. I follow this process weekly, in an effort to monitor companies I own and to uncover potential opportunities for further research.

The companies for this weeks review include:

Marsh & McLennan Companies, Inc. (MMC), is a professional services company that provides advice and solutions to clients in the areas of risk, strategy, and people worldwide. It operates in two segments, Risk and Insurance Services, and Consulting.

The company increased its quarterly dividend by 9.60% to 46 cents/share. This marked the 10th consecutive year of annual dividend increases for this newly minted dividend contender. Marsh & McLennan has managed to grow dividends at an annualized rate of 7% over the past decade.
Between 2009 and 2018, the company managed to grow earnings from 42 cents/share to $3.23/share. Marsh & McLennan is expected to generate $4.60/share in 2019. The stock is a little overvalued at 20.80 times forward earnings and yields 1.90%. If valuation becomes more attractive, the stock may be worth a second look.

National Bankshares Inc. (NKSH) operates as the bank holding company for the National Bank of Blacksburg that provides retail and commercial banking services to individuals, businesses, non-profits, and local governments.

The company raised its semi-annual dividend by 6.40% to 67 cents/share. This marked the 20th year of annual dividend increases for this dividend achiever. During the past decade, it managed to grow these distributions at an annualized rate of 4.20%.

Earnings per share didn’t grow by much between 2009 and 2018, rising only from $2.06/share to $2.32/share. The bank is expected to generate $2.63/share in 2019.

National Bankshares is fairly valued at 15.70 times forward earnings and offers a dividend yield of 3.20%. Given the slow earnings growth, I may place this on the back burner for now.

Northrop Grumman Corporation (NOC), a security company, provides products in the areas of autonomous systems, cyber, space, strikes, and logistics and modernizations in the United States, the Asia Pacific, and internationally. The company operates through four segments: Aerospace Systems, Innovation Systems, Mission Systems, and Technology Services.

The company raised its quarterly dividend by 10% to $1.32/share. This marked the 16th consecutive annual dividend increase for this dividend achiever. During the past decade, it managed to grow distributions at an annual rate of 12.70%/year.

Between 2009 and 2018 earnings increased from $5.21/share to $18.49/share. Northrop Grumman is expected to generate earnings of $19.38/share in 2019.

Currently, the stock is fairly valued at 15.80 times forward earnings and offers a safe yield of 1.70%.

IDEX Corporation (IEX), through its subsidiaries, operates as an applied solutions company worldwide. The company operates through three segments: Fluid & Metering Technologies (FMT), Health & Science Technologies (HST), and Fire & Safety/Diversified Products (FSDP).

The company increased its quarterly dividend by 16.30% to 50 cents/share. This marked the tenth consecutive annual dividend increase for this newly minted dividend contender. During the past decade, it has managed to grow dividends at an annual rate of 13.20%/year.

Between 2009 and 2018, earnings rose from $1.40/share to $5.29/share. The company is expected to generate $5.82/share in 2019.

Unfortunately, this company is overvalued at 25.90 times forward earnings. The stock yields 1.30% today. It may be worth a second look if it dips below 20 times forward earnings, which is equivalent to decline below $116/share.

Marriott International, Inc. (MAR) operates, franchises, and licenses hotel, residential, and timeshare properties worldwide. The company operates through North American Full-Service, North American Limited-Service, and Asia Pacific segments. The company raised its quarterly dividend by 17.10% to 48 cents/share. This was in line with the ten year average increase of 17.30%/year. Marriott International managed to grow earnings from $0.96/share in 2008 to $5.38/share 2018. The company is expected to generate $6.10/share in 2019.

The stock is overvalued at 21.50 times forward earnings. It yields 1.50%. The hospitality industry has had a strong decade, which has resulted in growing earnings per share. The next recession will decrease earnings per share, and shrink multiples to a more reasonable level.

Relevant Articles:

How to read my weekly dividend increase reports
Dividend Investors Should Ignore Market Fluctuations
Rising Earnings – The Source of Future Dividend Growth
How to read my stock analysis reports

Thursday, May 16, 2019

Vodafone Cuts Dividends to Shareholders

On Tuesday of this week, British Company Vodafone (VOD) cut its dividend by 40%. Not surprisingly, this dividend cut occurred several months after its Chief Financial Officer had stated that the dividend will not be cut. The dividend is cut due to several factors such as the need for cash to invest in 5G, and to acquire Liberty Global’s operations in Germany, the Czech Republic, Hungary and Romania

Vodafone (VOD) had been an international dividend achiever, with an almost 30-year history of annual dividend increases. The last five years saw dividend growth slow down to 2%/year. This was a decrease from the 7% annual growth in the preceding five years.

I own a few shares of Vodafone, because of investments I made in 2013. Because of the low amount of shares I own, it would not be cost effective to sell. If I owned a more material amount of shares however, valued around $1000 or more, I would likely sell and reinvest the proceeds elsewhere. Verizon may be a decent option.

You may enjoy the dividend stock analysis of Vodafone from the time I was considering the investment.

The major reason I invested in Vodafone was because of the value opportunity at play. Vodafone distributed shares of Verizon it had acquired as a result of the sale of its stake in Verizon Wireless to the parent company. What was a value play initially, turned out to be a slightly longer term investment.

I have not been a big fan of telecom companies in general throughout the years. This has somewhat been influenced by the fact that I have spent quite a few years working in the sector. This means that it made little sense to also load up my portfolio with telecom stocks. I have not been very enthusiastic about the sector in general too, but I have had exposure to it through my investment in Verizon (VZ), Vodafone and even AT&T (T) from time to time ( I used to follow an options strategy, which I stopped due to hassle factor, despite consistent profitability). I also view technological changes as a negative for the telecom sector.

However, I had sold most of my Vodafone shares throughout the years, for one reason or another. The main reason is the fact that I consolidated a lot of my retirement plans, and ended up buying funds with the proceeds. I ultimately kept only a small position from a legacy retirement account.
I thought of walking you through my history with this company. I like to discuss and share my mistakes, because I view them as learning opportunities. I believe that embracing mistakes and learning from them is ultimately what separates the people who are able to succeed in long-term investing from those who do not stick with it.

It turns out that I invested $200 in Vodafone on October 7, 2013. I used Sharebuilder – I believe that I paid $1/investment back then, but for some reason the broker states that it was a free trade. I ended up buying 5.70 shares of the telecom giant.

After a dividend reinvestment, I received shares of Verizon, which were spun off from Vodafone, or 1.5227 to be exact. Following this distribution, Vodafone enacted a 6:11 reverse split in its shares. The reverse split reduced the number of Vodafone shares from 5.79 to 3.16. I then kept reinvesting Verizon and Vodafone distributions until 2018. This was the time when Etrade decided to buy the brokerage business of Sharebuilder (now Capital One). As a result, there was a time when dividends were received in cash and fractional shares had to be sold before the transition.

I had 3.88 shares of Vodafone at the time, which meant I ended up selling 0.88 shares at $24.22/share or a total of $21.31. I also received a dividend of $4.56 in August 2018, prior to the remaining 3 shares being sent to Etrade. After February’s dividend I am left with 3.0898 shares, with a grand total value of $49.62 as of 5/15/2019.

I had 1.85 shares of Verizon, which meant I ended up selling 0.85 shares at $51.59/share for a total of 43.85. I also received $1.69 in dividends until the one share of Verizon was transferred out to Etrade. After May’s dividend I am left with 1.02161 shares worth a grand total of $58.04.

Overall, that $200 investment from October 2013 is now worth a whopping $179.07. If Sharebuilder hadn’t moved the assets over to Etrade and I didn’t have to sell fractional shares or receive dividends in cash, I would assume I would have still had a small loss on this investment. The largest point is that from an opportunity cost of view, I missed out on gain in some of the US Dividend Champions or Aristocrats over these five years. I did learn (or reiterate in a way) a few lessons on my portfolio building and strategy process.

Some random reader might laugh at these comically low dollar amounts I am discussing here. It makes it seem like my portfolio is an amateurish endeavor. Yet, they would be missing the forest for the trees with this comment. I am discussing low dollar amounts, because I ended up owning only a small amount in the company relative to total portfolio size. I bought a stock where I was ultimately wrong. I minimized the impact of the error by having a very small amount invested in the future dividend cutter Vodafone. When I build a position, I scale in slowly. If the story changes, or I lose confidence in management or there are better opportunities, I divert my capital elsewhere. This is how I end up with a lot of small holdings, which is a great way to monitor investments.

I think that the lesson for me is to invest small amounts regularly in a collection of dividend paying stocks, which meet my criteria. This way, I am able to diversify my exposure and not be exposed to the fortunes or lack thereof of a single company. In addition, by investing regularly, I am building my position slowly and over time. As a result, I am able to view negative changes and deteriorating conditions as I go through my leisurely accumulation of the position. As I view these conditions, and I see that the stock no longer meets my entry criteria, I stop accumulating. This is why I have so many small positions scattered around – they looked good at a time, but due to changes in the environment, I stopped adding to them. Therefore, I limited that amount of capital at risk. I rarely sell, which is a good thing, because on the flip side, I never know which of my investments will be my best one.

On the other hand, building positions slowly also exposes me to the risk that I identify a great company, but by the time I am able to accumulate the target position amount the stock price is too overvalued. As a result, I am stuck with a small position relative to what I would want it to be.

I also tend to accumulate dividends in cash, and pool them together with new cash deposited into my brokerage account, in order to make investments in the best values at the moment. This further helps me to diversify investments per sector, geography and over time. If I had simply let dividends accumulate in cash from Vodafone and Verizon, I would have been left with 3.10 Vodafone shares worth $49.80 and 1.50 shares of Verizon worth $85.20. I would have received $27.07 in cash dividends from Vodafone and $17.20 in cash dividends from Verizon for a total of $179.30. This is very close to what my investments ended being worth after all as well. But in reality, the change is that these funds would have been invested elsewhere and hopefully compounded at a better rate that Vodafone.

So to summarize:

• Keep investing mistakes small
• Spread risk by diversifying in many companies and over time
• Stop investing when story changes
• Keep Spin-offs
• Use dividends elsewhere by reinvesting them selectively in best values of the moment
• Review investing mistakes regularly, in order to learn from them and become a better investor


Relevant Articles:

Should I invest in AT&T and Verizon for high dividend income?
Are these high yield dividends sustainable?
Maintaining Moats in times of Technological Changes
Nine Dividend Paying Stocks I Accumulated in the Past Month

Monday, May 13, 2019

Ten Dividend Stocks Providing Consistent Raises to Shareholders

As part of my monitoring process, I look at the list of dividend increases every week. I usually focus my attention on the companies that have managed to grow dividends for at least a decade. As a result, I didn’t include shares of Tractor Supply (TSCO), which is a company whose story I am monitoring.
I also tend to focus on the companies that are growing dividends by more than a token amount, unless of course I own them. As a result, I didn’t include shares of Microchip Technologies (MCHP), which is raising distributions at a slow rate of less than 1%/year.

For the companies that are left to review, I look at the dividend increase relative to the ten-year average, to determine if dividend increases are moving in the right direction.

I also review the growth in earnings per share and payout ratio, in order to determine if the dividend is safe, and if there is room for further dividend increases down the road.

Last but not least, I also review valuation per my valuation guidelines. Even the best dividend growth stock in the world is not worth buying at excessively high valuation levels.

These are very similar to the criteria I use in my dividend stock analyses. The ideas I use to review companies are also the same types of attributes I use to put companies on the list for further research, to hold off until the right price or to quickly discard into the ‘too hard” box.

One of the reasons why I share these lists is to illustrate my criteria in action, hope to educate others about tools they could implement into their own process. Speaking of process, I find it very important to develop your own process, and to follow it, by continuously improving it as well.

Over the past week, there were several companies that increased dividends. Aside from the ones I already mentioned in a previous post, the companies in todays review include:

Chesapeake Utilities Corporation (CPK), a diversified energy company, engages in regulated and unregulated energy businesses. The company operates in two segments, Regulated Energy and Unregulated Energy.

The company hiked its quarterly dividend by 9.50% to 40.50 cents/share. This marked the 16th consecutive annual dividend increase for this dividend achiever. During the past decade, this company has been able to grow distributions at an annual rate of 5.70%.

Chesapeake Utilities managed to boost earnings from $1.43/share in 2009 to $3.45/share in 2018. Chesapeake Utilities is expected to earn $3.70/share in 2019.

The stock is overvalued at 25.70 times forward earnings and yields 1.70%.

Expeditors International of Washington, Inc. (EXPD) provides logistics services in the Americas, North Asia, South Asia, Europe, the Middle East, Africa, and India.

The company hiked its semi-annual dividend by 11.10% to 50 cents/share. This marked the 25th consecutive annual dividend increase for this newly minted dividend champion. The latest dividend hike is in line with the ten year average of 10.90%/year.

Between 2009 and 2018, Expeditors International managed to boost earnings from $1.11/share to $3.48/share. Expeditors International is expected to earn $3.55/share in 2019.

The stock is slightly overvalued at 20.80 times forward earnings and yields 2.70%. I will consider reviewing the stock if it drops below $71/share.

MSA Safety Incorporated (MSA) develops, manufactures, and supplies safety products that protect people and facility infrastructures in the oil, gas, petrochemical, fire service, construction, utilities, and mining industries worldwide. It operates through Americas and International segments.
The company approved a 10.50% increase in its quarterly dividend to 42 cents/share. This marked the 48th year of annual dividend increases for this dividend champion. During the past decade, it has managed to grow the annual dividends at a rate of 4.70%/year.

The company managed to grow earnings from $1.21/share in 2009 to $3.18/share in 2018.
MSA Safety is expected to earn $4.82/share in 2019. The stock is overvalued at 22.50 times forward earnings and yields 1.55%.

NACCO Industries, Inc. (NC), operates surface mines that supply bituminous coal and lignite primarily to power generation companies.

The company hiked its quarterly dividend by 15.20% to 19 cents/share. This marked the 34th year of annual dividend increase for this dividend champion. During the past decade, it managed to grow its dividends at a rate of 12.40%/year. From a fundamentals perspective, NACCO is more challenging to analyze, because the company from a decade ago is different from the company today due to two large spin-offs in 2012 and 2017. NACCO earned $5/share in 2018, which was higher than the $4.41/share it earned in 2017 – the first year as a stand-alone company.

The stock is cheap at 9.70 times earnings and yields 1.60%.

Quaker Chemical Corporation (KWR) develops, produces, and markets various formulated chemical specialty products for a range of heavy industrial and manufacturing applications in North America, Europe, the Middle East, Africa, the Asia/Pacific, and South America.

The company raised its quarterly dividend by 4.10% to 38.5 cents/share. This marked the twelfth year of annual dividend increases for this dividend achiever. During the past decade, it has managed to grow distributions at an annual rate of 4.80%/year.

Between 2009 and 2018, the company grew earnings from $1.47/share to $4.45/share.
Quaker Chemical is expected to earn $6.72/share in 2019. The company is overvalued at 30.80 times forward earnings and yields 0.70%.

VSE Corporation (VSEC) operates as a diversified services and supply company in the United States. The company operates in three segments: Supply Chain Management Group, Aviation Group, and Federal Services Group. The company raised its quarterly dividend by 12.50% to 9 cents/share. This marked the 16th year of annual dividend increases for this dividend achiever. During the past decade, it has managed to increase dividends by 13.40%/year.

Between 2009 and 2018, earnings per share increased from $2.33 to $3.21/share.
The stock looks attractively valued at 8.70 times earnings, though the current yield looks low at 1.30%.

Weyco Group, Inc. (WEYS) designs and distributes footwear. The company operates through two segments, North American Wholesale and North American Retail. Weyco raised its quarterly dividend by 4.40% to 24 cents/share. This marked the 38th consecutive annual dividend increase for this dividend champion. During the past decade, it has managed to boost distributions to shareholders at an annual rate of 6%.

Between 2008 and 2018, this dividend champion managed to grow its earnings from $1.44/share to $1.97/share. Unfortunately, the record earnings last year were only a few cents higher than the record earnings from 2007 of $1.90/share.

The stock looks attractively valued at 16.50 times earnings and offers a decent yield of 2.90%. The lack of material earnings growth over the past decade or so does not bode well for future dividend growth.

Cardinal Health, Inc. (CAH) operates as an integrated healthcare services and products company in the United States and internationally. The company operates through two segments, Pharmaceutical and Medical. Cardinal Health boosted its quarterly dividend by 1% to 48.11 cents/share. This marked the 24th consecutive annual dividend increase for this dividend achiever. During the past decade, Cardinal Health has managed to increase dividends at an annual rate of 17.50%. Annual dividend growth had slowed down to 3%/year over the past three years. The current rate of annual dividend increases shows that management does not expect much in terms of earnings growth for the next 12 – 36 months.

Cardinal Health is expected to earn $5.09/share in 2019. This is a decent growth from 2009’s earnings of $3.18/share.

At 9.60 times forward earnings, the stock is very cheap. The current yield is 3.90%, and the dividend seems well covered from earnings. However, I dislike the slowdown in dividend growth, and view it as an indication that the business is facing some larger than anticipated challenges. Check my analysis of Cardinal Health for more information about the company.

Connecticut Water Service, Inc. (CTWS), operates as a regulated water company. The company operates through three segments: Water Operations, Real Estate Transactions, and Services and Rentals. The company increased its quarterly dividend by 4.80% to 32.75 cents/share. This marked the 50th year of annual dividend increases for this newly minted dividend king. Over the past decade, it has managed to grow dividends at an annual rate of 3.40%/year.

Connecticut Water Service is expected to earn $2.34/share in 2019, which is higher than the 2009’s earnings of $1.11/share.

I view the stock as very overvalued at 29.80 times forward earnings. The yield is also low for a utility at 1.90%, while the dividend growth is not too exciting either.

Southside Bancshares, Inc. (SBSI) operates as the bank holding company for Southside Bank that provides a range of financial services to individuals, businesses, municipal entities, and nonprofit organizations. The company boosted its quarterly dividend by 3.30% to 31 cents/share. This marked the 25th consecutive annual dividend increase for this newly minted dividend champion. During the past decade, the company has managed to grow its distributions at an annual rate of 13.70%/year.
Southside Bancshares is expected to earn $2.27/share in 2019.

The stock yields 3.50% and trades at an attractive forward P/E of 15.60 times earnings.

Relevant Articles:

Dividend Kings List
The ten year dividend growth requirement
2019 Dividend Champions List
Valuing Dividend Stocks

Wednesday, May 8, 2019

Eight Dividend Achievers Showering Owners With More Cash

As part of my monitoring process, I review the list of dividend increases every week. I missed doing this on Monday, so I am catching up.

For this review, I included companies with at least a ten year track record of annual dividend increases.  These are the so called dividend achievers. The select few which have at least a 25 year track record of annual dividend increases are the dividend champions.

I also reviewed each company, based on the criteria I use to evaluate investments. These criteria focus on fundamentals, growth and valuation. The companies that raised dividends over the past ten days include:

Caterpillar Inc. (CAT) manufactures and sells construction and mining equipment, diesel and natural gas engines, and industrial gas turbines.

The company raised its quarterly dividend by 19.80% to $1.03/share. This marked the 26th year of annual dividend increases for this dividend champion. Caterpillar has been able to boost its distributions at an annual rate of 7.70% during the past decade.

Between 2009 and 2018, Caterpillar managed to grow earnings from $1.43/share to $10.26/share. Caterpillar is expected to earn$12.32/share in 2019.

Right now Caterpillar is attractively priced at 10.70 times forward earnings and offers a current yield of 3.10%.

RLI Corp. (RLI) is an insurance holding company, which underwrites property and casualty insurance in the United States and internationally. The company raised its quarterly dividend by 4.60% to 23 cents/share. This marked the 44th consecutive year of annual dividend increases for this dividend champion. RLI Corp. has been able to boost its distributions at an annual rate of 6.10% during the past decade.

Earnings per share decreased between 2009 and 2018 from $2.16 to $1.43. RLI Corp is expected to earn $2.45/share in 2019.

Right now I find RLI Corp to be overvalued at 33.70 times forward earnings. The stock yields 1.10%.

Healthcare Services Group, Inc. (HCSG) provides management, administrative, and operating services to the housekeeping, laundry, linen, facility maintenance, and dietary service departments of nursing homes, retirement complexes, rehabilitation centers, and hospitals in the United States. It operates through two segments, Housekeeping and Dietary.

The company increased its quarterly dividend to 19.75 cents/share. This is a 2.60% increase over the dividend paid during the same time last year. Healthcare Services Group has managed to grow dividends every quarter for 63 quarters in a row. Over the past decade, this dividend achiever has managed to grow dividends at a rate of 7.20%/year.

Between 2009 and 2018, earnings increased from $0.46 to $1.12/share. The company is expected to earn $1.45/share in 2019.

The stock is overvalued at 23.50 times forward earnings and yields 2.40%.

International Business Machines Corporation (IBM) operates as an integrated technology and services company worldwide. Its Cognitive Solutions segment offers a portfolio of enterprise artificial intelligence platforms, such as analytics and data management platforms, cloud data services, talent management, and industry solutions.

IBM raised its quarterly dividend by 3.20% to $1.62/share, This marked the 24th year of consecutive annual dividend increases for Big Blue. Over the past decade, it has managed to boost dividends at an annual rate of 12.60%. Dividend growth is slowing down, because of low earnings growth, threats to the business model and increasing dividend payout ratio.

Between 2009 and 2018, IBM’s earnings per share declined from $10.01 to $9.52. IBM is expected to generate $13.91/share in 2019.

IBM is cheap at 9.90 times forward earnings, yields 4.70% and offers an adequately covered dividend. Given the lack of meaningful earnings growth over the past decade, the decline in revenues and the recent acquisition activity, I would expect future dividend growth to be more subdued. I am not interested in buying the stock today.

UGI Corporation (UGI) distributes, stores, transports, and markets energy products and related services in the United States and internationally. The company operates through four segments: AmeriGas Propane, UGI International, Midstream & Marketing, and UGI Utilities.

UGI hiked its quarterly dividend by 15.40% to 30 cents/share. This marked the 32nd consecutive annual dividend increase for this dividend champion. Over the past decade. UGI has been able to grow its dividends at an annual rate of 7.30%.

UGI managed to grow earnings from $1.57/share in 2009 to $2.74/share in 2018. The company is expected to generate $2.44/share in 2019.

The stock is overvalued at 21.80 times forward earnings and yields 2.30%.

Regal Beloit Corporation (RBC) designs, manufactures, and sells electric motors, electrical motion controls, and power generation and transmission products worldwide. It operates through three segments: Commercial and Industrial Systems, Climate Solutions, and Power Transmission Solutions.

The company raised its quarterly dividend by 7.10% to 30 cents/share. This marked the 15th consecutive annual dividend increase for this dividend achiever. The latest dividend increase was faster than the ten year average of 5.70%/year.

The stock is attractively valued at 12.70 times forward earnings and yields 1.50%.

Between 2009 and 2018, earnings increased from $2.63/share to $5.26/share. The company is expected to generate $6.42/share in 2019.

Costco Wholesale Corporation (COST) operates membership warehouses.

The company increased its quarterly dividend by 14% to 65 cents/share. This marked the 17th consecutive annual dividend increase for this dividend achiever. The latest increase is also in line with the ten year average increase of 13.40%/year. Between 2009 and 2018, the company grew earnings from $2.47/share to $7.09/share. Costco is expected to earn $7.96/share in 2019.

Costco is a great company I wish I owned. However, it is always available at a premium valuation. Today is no exception, as the stock sells at 30.30 times forward earnings and yields 1.10%. I will likely be a buyer below $160/share.

Leggett & Platt, Incorporated (LEG) designs and produces various engineered components and products worldwide. It operates through four segments: Residential Products, Furniture Products, Industrial Products, and Specialized Products.

The company raised its quarterly dividend by 5.30% to 40 cents/share. This marked the 48th consecutive annual dividend increase for this dividend aristocrat. The company has managed to boost its distributions at an annual rate of 4%/year over the past decade.

Between 2008 and 2018, Leggett & Platt managed to grow earnings from $0.73 to $2.26/share. The company is expected to earn $2.48/share in 2019.

The stock is attractive at 15.70 times forward earnings and a dividend yield of 4.10%.

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Tuesday, May 7, 2019

Dividend Stock Analysis of FedEx (FDX)

FedEx Corp. (FDX) engages in the provision of a portfolio of transportation, e-commerce, and business services. It operates through the following segments: FedEx Express, TNT Express, FedEx Ground, FedEx Freight, FedEx Services, and Other. One of its largest competitors is United Parcel Services (UPS).

FedEx is a dividend achiever with a 17-year record of annual dividend increases. The last dividend increase for FedEx occurred in June 2018, when it hiked quarterly dividends by 30% to 65 cents/share.

Over the past decade, FedEx has managed to grow dividends at an annual rate of 18.30%/year.

Earnings per share increased from $3.60 in 2008 to $12.57 in 2018. The 2018 earnings per share have been reduced by the impact of the new tax law signed in effect in 2017. The one-time impact reduction to EPS was for $4.22/share. On a side note, the company’s year-end is in May, rather than December. FedEx is expected to earn $16.01/share in 2019, which is before any one-time items.

The company has achieved growth through strategic acquisitions. The latest acquisition was that of TNT Express in 2016. FedEx is still working on integrating TNT Express into its operations, in order to generate the synergies and cost efficiencies it projected.

The rise in global economic output over time, should stimulate demand for package deliveries. This won’t be a smooth uptrend of course, given the fact that economies contract occasionally as well. FedEx and UPS are well positioned to ride the increase in online sales over time. The companies have to invest sufficient resources to address peak demand for their services around the holidays.
FedEx generates 43% of revenues in the US. Roughly 70% of revenues are coming from ground transportation and includes FedEx Kinko’s while the rest come from freight services throughout the US.

The international business accounts for 57% of revenues and transports packages in 220 countries.
The company has also managed to repurchase some shares over the past decade, which has helped grow earnings per share.

FedEx became active on the share repurchases front in 2014. Between 2008 and 2013, shares increased from 312 million to 317 million. Since 2013, FedEx has managed to reduce the number of shares all the way down to 266 million.

The dividend payout ratio increased from 12% in 2008 to 18% in 2018. It looks like dividend growth over the past decade was largely driven by growth in earnings per share, with only some support from growing the payout ratio. I believe that the payout ratio can easily grow over the next decade, which could translate into high dividend growth during that time period.

Currently, the stock is attractively valued at 11.30 times forward earnings and yields 1.45%. Based on 2018 earnings, the stock is still attractively valued. FedEx is a cyclical stock, which means that it is better to buy it on a dip. It is also important to remember that cyclical companies are usually cheapest at the top of the cycle, when their earnings are highest. They look their worst at the bottom of the economic cycle, because their earnings are very depressed.

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Wednesday, May 1, 2019

United Parcel Service (UPS) Dividend Stock Analysis

United Parcel Service, Inc. (UPS) provides letter and package delivery, specialized transportation, logistics, and financial services. It operates through three segments: U.S. Domestic Package, International Package, and Supply Chain & Freight.

The company has managed to grow dividends annually since 2009. The last increase was in February 2019, when the dividend was increased by 5.50% to 96 cents/share.

Over the past decade, UPS has managed to grow dividends at an annual rate of 7.30%/year. In other words, the company doubled dividends per share, despite the fact that it didn’t grow them every single year over the past decade.

Between 2008 and 2018, UPS managed to grow earnings per share from $2.94 to $5.51. UPS has announced a 2019 Adjusted EPS Guidance Range of $7.45 to $7.75/share. The range excludes the impact of mark-to-market changes in pension liabilities.

The company generates a little over 60% from US operations, while 20% comes from international. The rest is derived from its supply chain and freight operations. Packages are moved through ground delivery and air delivery ( 83% and 17% respectively). UPS Supply Chain Solutions manage every aspect of global supply chains, including logistics, distribution, transportation, LTL, air freight, ocean shipping, customs brokerage etc..

Revenues can be positively affected by growth in volumes and pricing increases. UPS and FedEx have a strong presence in the US domestic market, essentially operating as a duopoly. This means that it would be very difficult and costly for a competitor to gain market share, and do so in a profitable manner. This bodes well for pricing and margins. Growth will be driven by increasing economic activity over time, and a lot from the rise in ecommerce.

International operations could also be an opportunity for future growth. International operations are expected to grow faster than domestic ones, due to the higher expected growth of international economies.

Growth could also be realized through strategic or bolt-on acquisitions. Given the high market share that UPS has however, it is very likely that these deals will be heavily scrutinized by regulators. A prime example includes the company’s attempt to acquire TNT Express in 2012, which was ultimately scrapped one year later.

Between 2008 and 2018, the company managed to reduce the number of shares outstanding from 1.022 billion to 871 million. A consistent share buyback program gradually increases the percentage ownership for shareholders who keep their shares, at the expense of those who sell their stock to the company. If a business doesn’t overpay for these shares, the remaining shareholders are better off.

The dividend payout ratio increased from 61% in 2008 to 66% in 2018. The forward payout ratio is at 52%.

Currently, UPS trades at 14.10 times forward earnings and yields 3.70%. I find the stock to be attractively valued today.

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Monday, April 29, 2019

Eleven Dividend Focused Companies For Further Research

I review the list of dividend increases every week, as part of my monitoring process. This exercise helps me to check up on existing holdings and to identify companies for my watch list.

Last week, there were seven dividend growth stocks that raised dividends to shareholders. Each one of those companies has at least a ten year track record of annual dividend increases. Since dividends are paid out of earnings, these dividend achievers couldn’t have compiled such a record without having enjoyed consistent success in their core business, whatever it is. So you’re looking at a group of profitable enterprises with staying power.

I review the increase relative to the dividend record, along with valuation and track record. The companies included:

Exxon Mobil Corporation (XOM) explores for and produces crude oil and natural gas in the United States, Canada/Other Americas, Europe, Africa, Asia, and Australia/Oceania. It operates through Upstream, Downstream, and Chemical segments.

The company raised its quarterly dividend by 6.10% to 87 cents/share. This marked the 37th year of annual dividend increases for this dividend champion. Over the past decade, the company has managed to grow its annual dividend at a rate of 7.60%/year. Exxon Mobil’s earnings went from $3.88/share in 2009 to $4.88/share in 2018. Exxon-Mobil is expected to generate $4.37/share in 2019.

Currently, Exxon Mobil is richly valued at 18.40 times forward earnings and yields 4.30%. The stock has a forward payout ratio of 79.60%. I view the stock as a hold today, but I would not be adding to my position, given the lack of meaningful earnings growth over the past decade. The high payout ratio signifies that future dividend growth will be limited and much slower in the future, unless we get another steep increase in oil prices.

Johnson & Johnson (JNJ), researches and develops, manufactures, and sells various products in the health care field worldwide. It operates in three segments: Consumer, Pharmaceutical, and Medical Devices.

The company raised its quarterly dividend by 5.60% to 95 cents/share. This marked the 57th consecutive annual dividend increase for this dividend king. The company has managed to grow dividends by 7%/year on average over the past decade.

Between 2009 and 2018 the company managed to boost earnings from $4.40/share to $5.61/share. The company is expected to generate $.8.61/share in 2019.

The stock is attractively valued at 16.30 times forward earnings and yields 2.70%.


W.W. Grainger, Inc. (GWW) distributes maintenance, repair, and operating (MRO) products and services in the United States, Canada, Europe, Japan, Mexico, and internationally.

The company raised its quarterly dividend by 5.90% to $1.44/share. This marked the 48th consecutive annual dividend increase for this dividend champion. Over the past decade, it has managed to hike its distributions at a rate of 13.20%/year. Between 2009 and 2018, the company has managed to grow earnings from $5.62/share to $13.73/share. W.W. Grainger is expected to earn $17.97/share in 2019.

The stock seems attractively priced at 16.20 times forward earnings and yields 2%.

Cullen/Frost Bankers, Inc. (CFR) operates as the holding company for Frost Bank that offers commercial and consumer banking services in Texas. It operates in two segments, Banking and Frost Wealth Advisors.

The company raised its quarterly dividend by 6% to 71 cents/share. This marked the 26th consecutive annual dividend increase for this dividend champion. The company has managed to grow dividends by 4.50%/year on average over the past decade.

Between 2009 and 2018 the company managed to boost earnings from $3/share to $6.90/share. The company is expected to earn $7.10/share in 2019.

The stock looks attractively valued at 14.10 times forward earnings and offers a 2.80% dividend yield today.

Ameriprise Financial, Inc. (AMP), provides various financial products and services to individual and institutional clients in the United States and internationally. It operates through five segments: Advice & Wealth Management, Asset Management, Annuities, Protection, and Corporate & Other.

The Board of Directors of Ameriprise Financial raised its quarterly dividend by 7.80% to 97 cents/share. This marked the 14th consecutive annual dividend increase for this dividend achiever. The ten year dividend growth rate is 18.20%/year on average.

Between 2009 and 2018, Ameriprise Financial has been able to grow earnings from $2.95/share to $14.29/share. Ameriprise is expected to generate $15.71/share in 2019.

The stock is attractively valued at 9.30 times forward earnings and offers an attractive current yield of 2.60%.

Magellan Midstream Partners, L.P. (MMP) engages in the transportation, storage, and distribution of refined petroleum products and crude oil in the United States. The partnership operates through Refined Products, Crude Oil, and Marine Storage segments. Magellan increased its quarterly distribution to $1.005/unit, which represents a 10.70% increase over the distribution paid during the same time last year. The partnership has managed to grow distributions by 10.80%/year on average over the past decade. Magellan Midstream Partners has managed to increase its annual distributions for 18 years in a row. The MLP yields 6.50% today. Along with Enterprise Products Partners, it is one of the better run MLPs out there in my opinion.

Parker-Hannifin Corporation (PH) manufactures and sells motion and control technologies and systems for various mobile, industrial, and aerospace markets worldwide. The company operates in two segments, Diversified Industrial and Aerospace Systems.

The company raised its quarterly dividend by 15.90% to 88 cents/share. This marked the 63th consecutive annual dividend increase for this dividend king. The company has managed to grow dividends by 12.30%/year on average over the past decade.

Between 2009 and 2018 the company managed to boost earnings from $4.40/share to $5.61/share. Parker-Hannifin is expecting to earn between $11.04 and $11.54/share in 2019.

Parker-Hannifin looks attractively valued at 16.60 times forward earnings and yields 1.90%.

Portland General Electric Company (POR), an integrated electric utility company, engages in the generation, wholesale purchase, transmission, distribution, and retail sale of electricity in the state of Oregon. The company operates seven thermal plants; seven hydroelectric plants; and two wind farms. The company raised its quarterly dividend by 6.20% to 38.5 cents/share. This marked the 14th consecutive annual dividend increase for this dividend achiever. The company has managed to grow dividends by 3.90%/year on average over the past decade.

Between 2009 and 2018, the company managed to grow its earnings from $1.31/share in 2009 to $2.37/share in 2018. The utility is expected to earn $2.44/share in 2019.

The stock looks overvalued at 21.40 times forward earnings. Portland General Electric yields 2.95%.

Westamerica Bancorporation (WABC) is the holding company for Westamerica Bank, a regional community bank providing consumer and commercial financing with branches throughout Northern and Central California. The company raised its quarterly dividend by 2.50% to 41 cents/share. This marked the 28th consecutive annual dividend increase for this dividend champion. The company has managed to grow dividends by 1.40%/year on average over the past decade.

Between 2009 and 2018, earnings per share decreased from $4.14 to $2.67. Westamerica is expected to generate $2.98/share in 2019. The bank is overvalued at 21.50 times forward earnings and yields 2.60%. Due to the high valuation, lack of earnings growth, and slow dividend growth over the past decade, I am not interested in the stock at the time.

Xilinx (XLNX) develops highly flexible and adaptive processing platforms that enable rapid innovation across a variety of technologies – from the endpoint to the edge to the cloud. The company raised its quarterly dividend by 2.80% to 37 cents/share. This marked the 17th consecutive annual dividend increase for this dividend achiever. The company has managed to grow dividends by 10.20%/year on average over the past decade.

Between 2009 and 2018, the company managed to grow earnings from $1.31/share to $1.99/share. Xilinx is expected to earn $3.83/share in 2019. The stock is overvalued at 31 times forward earnings. Xilinx yields 1.20%.

Evercore Inc. (EVR), operates as an independent investment banking advisory firm in the United States, Europe, Latin America, and internationally. It operates through two segments, Investment Banking and Investment Management. The company boosted its quarterly dividend by 16% to 58 cents/share. This dividend achiever has managed to grow dividends for 13 years in a row. Over the past decade, it has managed to raise dividends at an annual rate of 14.75%/year. Evercore lost 16 cents/share in 2009, but has managed to turn around operations to a gain of $8.33/share in 2018. Evercore is expected to generate $7.95/share in 2019.

The stock is fairly priced at 12.10 times forward earnings and yields 2.40%.

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Wednesday, April 24, 2019

Ten Dividend Growth Stocks For April 2019

I launched my premium Dividend Growth Investor newsletter in July 2018 with the main goal of educating individual investors and empowering them to learn how to achieve their goals. I use the experience accumulated in my own investing over the past decade and a half, as a guideline for my newsletter.

I discuss the process to identify and research individual companies, in order to come up with ten investments that I am considering every single month. I go through the process of analyzing quantitative and qualitative factors behind each investment I make.

I go a step further, because I put $1,000 of my own money every month behind each one of these investments. This is a real money portfolio, that generates real dividends.

My goal is to educate investors, as I keep investing and building that future income through new contributions, organic dividend increases and strategic dividend reinvestment. The ultimate goal of this portfolio is to generate $1,000 in monthly dividend income.

By investing money every month, readers are able to see companies that I find attractively valued today. It is of little value to you as a reader that I purchased Visa in 2011 at a cost of $34/share. It is much more educational to learn which companies are selling at attractive valuations today. I believe that great companies should be accumulated at attractive valuations, and then held on for the long term.

Of course, I do more than just provide a list of ten attractively valued companies. I discuss the steps I take to build a dividend portfolio whose goal is to generate safe long-term dividend income. I also share the process of managing this portfolio, and important steps on wealth accumulation. I am a buy and hold investor at heart, who believes in diversification and the idea of developing and following a common sense investment process to reach my investment objectives. I rarely sell, and believe that time in the market beats timing the market. This is why I am investing in ten attractively valued dividend stocks every single month.

For a limited time, you can subscribe the newsletter at a low annual price of $65/year. This is an exclusive low price that will be available by the end of April.

You can sign up through Paypal by clicking on the link below:










As part of this promotion, I offer a 7 day free trial. Once you sign up, I will add you to the list and send you the April 2019 newsletter on Sunday, April 28. I will purchase these companies on Monday, April 29.  I will then send a list of dividend portfolio holdings by May 5.

Monday, April 22, 2019

Ten Dividend Geese Laying Golden Eggs for Investors

As part of my monitoring process, I review the list of dividend increases every week. I use this exercise to review dividend increases for companies I own. I also use this exercise to observe dividend companies in action, and potentially uncover dividend gems for further research. I usually focus my attention on companies that have managed to boost distributions for at least a decade. I then take each company through my analysis checklist. The end result is a quick overview of several dividend growth stocks for your review.

The companies that raised dividends last week for this review include:

AptarGroup, Inc. (ATR) provides a range of packaging, dispensing, and sealing solutions primarily for the beauty, personal care, home care, prescription drug, consumer health care, injectable, and food and beverage markets. The company operates through three segments: Beauty + Home, Pharma, and Food + Beverage.

The company raised its quarterly dividends by 5.90% to 36 cents/share. This was the company’s 26th consecutive year of paying an increased dividend. The latest increase was slower than the ten year growth in dividends of 9%/year.

Annual earnings grew from $1.79/share in 2009 to $3/share in 2018. AptarGroup is expected to generate $4.28/share in 2019.

This dividend champion is overvalued at 25.30 times forward earnings. The stock yields 1.30%.

American Water Works Company, Inc. (AWK) provides water and wastewater services in the United States and Canada.

The company raised its quarterly dividend by 9.90% to 50 cents/share. This marked the eleventh year of annual dividend increases for this dividend achiever. Over the past decade, it has managed to boost dividends at an annual rate of 16.10%/year.

Between 2009 and 2018, American Water Works managed to grow earnings from a negative $1.39/share to a positive $3.15/share. The company is expected to generate $3.59/share in 2019.

The stock is overvalued today at 29.20 times forward earnings and yields 1.90%.

Bar Harbor Bankshares (BHB) operates as the holding company for Bar Harbor Bank & Trust that provides commercial, retail, and wealth management banking products and services.

The company raised its quarterly dividend by 10% to 22 cents/share. This marked the 16th year of annual dividend increases for this dividend achiever. Over the past decade, the company has managed to grow dividends at an annual rate of 5.70%/year.

The bank grew earnings from $1.39/share in 2009 to $2.12/share in 2018.

The stock looks attractively valued at 12.40 times earnings and yields 3.30%. It is a good company to place on the list for further research.

Celanese Corporation (CE) is a technology and specialty materials company which manufactures and sells high performance engineered polymers in the United States and internationally. The company operates through Engineered Materials, Acetate Tow, and Acetyl Chain segments.

The company announced a 14.80% increase in its quarterly dividend to 62 cents/share. This event marked the tenth consecutive year of dividend increases for this newly minted dividend achiever. Over the past decade, Celanese has managed to boost dividends at a rate of 29.20%/year.

Between 2009 and 2018, the company has managed to grow earnings from $3.17/share to $8.91/share. Celanese is expected to generate $10.37/share in 2019.

The stock is attractively valued at 10.10 times forward earnings and yields 2.35%. This is a company that I would add to my list for further research.

Donegal Group Inc. (DGICA) (DGICB), is an insurance holding company, which provides personal and commercial lines of property and casualty insurance to businesses and individuals in the Mid-Atlantic, Midwestern, New England, and southern states. It operates through four segments: Investment Function, Personal Lines of Insurance, Commercial Lines of Insurance, and Investment in DFSC.
The company raised its dividend on A shares by 1.75% to 14.50 cents/share and the dividend on B shares by 2% to 12.75 cents/share. This marked the 17th year of annual dividend increases for this dividend achiever. The ten year dividend growth rate comes out to a 3.40% annualized.

Earnings per share went from 68 cents/share in 2009 to a loss of $1.18/share in 2018. The company is expected to earn 0.68/share in 2019.

The stock is selling at 18.60 times forward earnings and yields 4.60%. The forward payout ratio is at 85.30%. The yield is high, but the growth is low. The payout ratio looks like it is high as well. I will take a pass on Donegal for now.

ONEOK, Inc. (OKE) engages in the gathering, processing, storage, and transportation of natural gas in the United States. It operates through Natural Gas Gathering and Processing, Natural Gas Liquids, and Natural Gas Pipelines segments.

ONEOK raised its quarterly dividend to 86.50 cents/share. This is an 8.80% increase over the dividend paid during the same time last year. Over the past decade, this dividend achiever has managed to boost dividends at an annualized rate of 16.90%. It has a 17 year track record of annual dividend increases.

Between 2009 and 2018, the company’s earnings grew from $1.44/share to $2.78/share. ONEOK is expected to earn $2.98/share in 2019.

The stock is overvalued at 23.20 times forward earnings but offers a nice yield of 5%.

People's United Financial, Inc. (PBCT) operates as the bank holding company for People's United Bank, National Association that provides commercial banking, retail banking, and wealth management services to individual, corporate, and municipal customers. The company operates in two segments, Commercial Banking and Retail Banking.

The bank raised its quarterly dividend by 1.40% to 17.75 cents/share. This marked the 27th consecutive annual dividend increase for this dividend champion. Over the past decade, this dividend champion has managed to grow distributions at an annual rate of 1.80%/year.

Between 2008 and 2018, the bank grew earnings from 41 cents/share to $1.29/share. The company is expected to generate $1.41/share in 2019.

The stock is attractively priced at 12.10 times forward earnings and offers a forward dividend yield of 4.10%. Given the lack of dividend growth over the past decade, I am taking a pass on the company for the time being.

Sonoco Products Company (SON) manufactures and sells industrial and consumer packaging products in North and South America, Europe, Australia, and Asia. The company operates through four segments: Consumer Packaging, Display and Packaging, Paper and Industrial Converted Products, and Protective Solutions.

The company raised its quarterly dividend by 4.90% to 43 cents/share. This marked the 37th year of annual dividend increases for this dividend champion. Over the past decade, Sonoco has been able to grow its dividends at an annual rate of 4.20%.

Sonoco managed to grow earnings from $1.50/share in 2009 to $3.10/share in 2018. The company is expected to earn $3.52/share in 2019.

The stock is fairly valued at 17.20 times forward earnings and offers a forward dividend yield of 2.80%.

The Southern Company (SO) engages in the generation, transmission, and distribution of electricity. It operates in four segments: Gas Distribution Operations, Gas Pipeline Investments, Wholesale Gas Services, and Gas Marketing Services.

Last week, this utility managed to boost its quarterly dividend by 3.30% to 62 cents/share. This marked the 19th consecutive annual dividend increase for this dividend achiever. During the past decade, it has managed to boost distributions at an annualized rate of 3.65%.

Between 2009 and 2018, the company’s earnings went from $2.06/share to $2.17/share. Southern Company is expected to earn $3.03/share in 2019.

The stock seems fairly valued at 17.10 times forward earnings and offers a dividend yield of 4.80%. Given the lack of earnings growth over the past decade, I would mark the stock as a hold.

The Travelers Companies, Inc. (TRV) provides a range of commercial and personal property, and casualty insurance products and services to businesses, government units, associations, and individuals in the United states and internationally. The company operates through three segments: Business Insurance, Bond & Specialty Insurance, and Personal Insurance.

The company boosted its quarterly dividend by 6.50% to 82 cents/share. This marked the 15th year of annual dividend increases for this dividend achiever. Over the past decade, this dividend achiever has managed to compound dividends at an annual rate of 9.80%.

Travelers has managed to boost earnings per share from $6.33 in 2009 to $9.28 in 2018. The company is expected to generate $11.07/share in 2019.

The stock is attractively valued at 12.60 times forward earnings and spots a dividend yield of 2.40%. Check my analysis of Travelers Companies for more information about the company.

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