Dividend Investing: Eight Companies with Positive Feedback

A vision is taking the time to think of (anticipate) in detail what the future will bring. You would need to consider future earnings, savings and economic issues such as inflation. Then based on what you foresee in the future, you would formulate an action plan to ensure the best possible outcome given your unique circumstances. You can't have a retirement plan until you have a retirement vision. It would seem to me that there are a lot or retirement plans out there but very few retirement visions.

A portion of my retirement planning includes dividend investing. One of the beauties of dividend investing is it provides you continuous feedback. As the years and decades go by you can see your earnings steadily grow as you invest your money in dividend stocks. Here are a few select companies that have recently provided their shareholders positive feedback by raising their cash dividends:

• Matthews Int'l (MATW) Boosts Quarterly Dividend by 1.5% to $0.065/Share (0.06%)
• VF Corp. (VFC) Boosts Quarterly Dividend 2% to $0.59/Share (4.32%)
• PPG Industries (PPG) Boosts Quarterly Dividend 2% to $0.53/Share (4.20%)
• Goodrich (GR) Boosts Quarterly Dividend by 11% to $0.25/Share (2.71%)
• UMB Financial (UMBF) Boosts Quarterly Dividend by 6% to $0.175/Share (1.31%)
• Home BancShares (HOMB) Increases Quarterly Dividend 55% to $0.065/Share (1.31%)
• Stepan Company (SCL) Boosts Quarterly Dividend by 4.7% to $0.22/Share (2.25%)
• The Eastern Company (EML) Raises Quarterly Dividend by 12.5% to $0.09/Share (2.89%)

After running these companies through my D4L-PreScreen.xls model, VFC and PPG both had a positive NPV of MMA Differential, but fell short of the $3,000 I look for from a company that is a Dividend Aristocrat. None of the others achieved the necessary NPV of MMA Differential to justify a full evaluation.

Disclosure: No position in the aforementioned stocks.

Comments

[notsosmart:]

yields too low for this world at this time.should include ceo's total compensation package cost & bod's fees.

2008 Oct 24 09:46 AM

[axelrod608:]

how about AAV at 25%, HTE at 44%. PWE at 24%, LINE at 16%, APL at 19% ????

Most of yours are yielding less than inflation !!!

2008 Oct 24 11:48 AM

[jackooo:]

The dividends you mention are so low I rather put my $$ under the mattress.

2008 Oct 24 12:04 PM

[Urbane Gori...:]

I agree .. If you can't trust gold to go up in this market (and it isn't.. ) then you at least need good high dividends. And that's what I'm looking at.. I want a basket of solid companies with high dividends that should jump when the world gets off the pot.

To axelrod608's, I'll throw in some coal, a copper co, shippers and some dividend funds:

ARLP, PCU, FRO, PRGN, ADO, AGD.... It's probably time to begin looking at some REITS as well.. Not commercial REITS, but those that cater to medical use.

jegan ;-)

2008 Oct 24 01:40 PM

[Old Trader:]

jegan,

Have been looking at shippers for quite a while, but do you think the current yields are sustainable? (given the general decrease in global commerce). Although given the cyclical nature of the industry, maybe if they're held through a full cycle...

2008 Oct 24 08:20 PM

[Dividends A...:]

If you put your money under the mattress the only thing it'll collect is dust. 1% is still better than 0% unless your mattress is inflation resistent

2008 Oct 24 10:08 PM

[d_teller:]

In reponse to J. Egan's suggestions, keep in mind that AOD and AGD price the NAV's at intervals, and while they collectively hold respectable names, those share prices have fallen substantially, and sometimes these closed-end funds will appear to trade at a premium, while in a few days they trade (share price below NAV) at a small discount...they seldom have a large discrepancy and their dividends are given for the next 3 mo. period: AOD 18 cents, and AGD, 17 cents for Oct-Dec., 08. Afterwards, who knows.

Paragon has fallen considerably in the past month, as both a shipper vulnerable to spot prices and a tanker company. I'd look at Eagle (EGLE) and Diana (DSX) which have crumbled with the demand destruction hypothesis, but they have little debt and forward hedged rates through the next two years...IMHO, way undervalued.

FRO and other tanker companies have also been hit by the perception that oil shipments will decrease by > 50% (as the price of oil falls 50 %)...Unlkely, and maybe a good entry time.

PCU and Freeport-McMoran, are interesting, because Dr. Copper has fallen below $2.40/lb...an indication that this commodity won't be needed in the upcoming (according to the spot pricing) depression, anyplace in the world. At these prices for PCU and Freeport, and for TX, or SID, if you don't have them, they might be good entry points, put in a small bid at 10% below the latest cost, and leave it for a week..

By the way. for OldTrader, the shipping cycle can be 4 years or longer...and you need to look at the debt costs for the companies, (it's gone up astronomically, as the credit crunch continues) + look at how the contracts for the services are priced...spot = depressed and subject to the shipping index (which says we're headed to a 2001-2 recession) or hedged, as though the costs to ship will stay the same for another two-three years (and with decreasing marine diesel costs, the costs are actually DECREASING), and the company's debt load and marketing process.

Those that rapidly cycle (GENCO= GNK), can vary 25% in a month, and are great for taxable accounts yo-yo-ing btween 15 and 70.

I do hold GMR, DSX, EGLE, AOD, AGD, PRGN, PYGYF, PCU, and others in tax-sheltered accounts. GNK and others are in a taxable account.

2008 Oct 25 09:12 PM

[d_teller:]

To Axelrod 608:

The latest from Linn Energy (LINE) is that its costs and loans are secure through 2013-2014. It's a very good buy for a taxable account, IMHO.

2008 Oct 25 09:16 PM