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Many investors are attracted to "dividend champion" stocks, or those listed by DRiP Investing as those that have consistently increased their dividends over the last 25 years. But history is no guarantee of future payouts, and investors would be wise to take a close look at sales trends before making any investment decisions.

Dividend champions sound attractive but many income seeking investors are let down when they realize the majority of the champions offer low yields. Consider that of the 106 Champions, only 33 offer yields above 3%. For example, C.R. Bard Inc. has spent 41 years raising its dividend to a whopping 0.79% yield.

When creating the following stock list we limited our universe to the higher yield names (above 3%). But higher yields make it more difficult for companies to make payouts, which is why we screened "dividend champions" for accounting trouble, particularly in accounts receivable.

Accounts receivable is the portion of revenue (sales) that has not yet been received. Since there is no guarantee that this money will be recovered, the higher the portion of revenue attributable to accounts receivable, the lower the quality of revenue. This is especially troubling for dividend stocks, because dividends are paid out of these revenues.

To be specific, we screened for stocks seeing slower growth in revenue than accounts receivable year-over-year, as well as accounts receivable comprising a larger portion of current assets over the same time period.

Compare changes in yield over the past two years. For an interactive version of this chart, click on the image below.

Do you think these stocks can continue to pay reliable dividends? Use this list as a starting point for your own analysis. List Average 1-Year Return: 17%.

1. WGL Holdings Inc. (WGL): Engages in the delivery and sale of natural gas, and provides energy-related products and services in the District of Columbia, Maryland, Virginia, and Delaware.

  • Market cap at $2.28B. The company has raised dividends for 37 consecutive years. Current yield: 3.809%.
  • Revenue grew by -5.64% during the most recent quarter ($686.74M vs. $727.76M y/y). Accounts receivable grew by 5.6% during the same time period ($340.73M vs. $322.67M y/y). Receivables, as a percentage of current assets, increased from 31.69% to 33.7% during the most recent quarter (comparing 3 months ending 2012-12-31 to 3 months ending 2011-12-31).

2. Diebold, Incorporated (DBD): Provides integrated self-service delivery and security systems and services primarily to the financial, commercial, government, and retail markets worldwide.

  • Market cap at $1.89B. The company has raised dividends for 60 consecutive years. Current yield: 3.79%.
  • Revenue grew by -1.16% during the most recent quarter ($840.1M vs. $849.99M y/y). Accounts receivable grew by 17.69% during the same time period ($488.37M vs. $414.97M y/y). Receivables, as a percentage of current assets, increased from 23.95% to 26.91% during the most recent quarter (comparing 3 months ending 2012-12-31 to 3 months ending 2011-12-31).

3. Piedmont Natural Gas Co. Inc. (PNY): Distributes natural gas to residential, commercial, industrial, and power generation customers in portions of North Carolina, South Carolina, and Tennessee.

  • Market cap at $2.55B. The company has raised dividends for 35 consecutive years. Current yield: 3.77%.
  • Revenue grew by 9.33% during the most recent quarter ($515.88M vs. $471.84M y/y). Accounts receivable grew by 21.66% during the same time period ($272.57M vs. $224.05M y/y). Receivables, as a percentage of current assets, increased from 52.07% to 59.81% during the most recent quarter (comparing 3 months ending 2013-01-31 to 3 months ending 2012-01-31).

4. Black Hills Corporation (BKH): Operates as a diversified energy company primarily in the United States.

  • Market cap at $1.99B. The company has raised dividends for 43 consecutive years. Current yield: 3.45%.
  • Revenue grew by -11.72% during the most recent quarter ($318.86M vs. $361.18M y/y). Accounts receivable grew by -1.46% during the same time period ($163.7M vs. $166.12M y/y). Receivables, as a percentage of current assets, increased from 21.89% to 40.41% during the most recent quarter (comparing 3 months ending 2012-12-31 to 3 months ending 2011-12-31).

5. Atmos Energy Corporation (ATO): Engages primarily in the distribution, transmission, and storage of natural gas in the United States.

  • Market cap at $3.88B. The company has raised dividends for 29 consecutive years. Current yield: 3.279%.
  • Revenue grew by -4.6% during the most recent quarter ($1,034.15M vs. $1,083.99M y/y). Accounts receivable grew by 2.26% during the same time period ($500.86M vs. $489.8M y/y). Receivables, as a percentage of current assets, increased from 38.83% to 43.01% during the most recent quarter (comparing 3 months ending 2012-12-31 to 3 months ending 2011-12-31).

6. California Water Service Group (CWT): Provides water utility and other related services in California, Washington, New Mexico, and Hawaii.

  • Market cap at $932.1M. The company has raised dividends for 46 consecutive years. Current yield: 3.216%.
  • Revenue grew by 17.98% during the most recent quarter ($121.53M vs. $103.01M y/y). Accounts receivable grew by 34.32% during the same time period ($75.92M vs. $56.52M y/y). Receivables, as a percentage of current assets, increased from 49.63% to 51.8% during the most recent quarter (comparing 3 months ending 2012-12-31 to 3 months ending 2011-12-31).

7. Nucor Corporation (NUE): Engages in the manufacture and sale of steel and steel products in North America and internationally.

  • Market cap at $13.96B. The company has raised dividends for 40 consecutive years. Current yield: 3.18%.
  • Revenue grew by -7.84% during the most recent quarter ($4,451.27M vs. $4,829.68M y/y). Accounts receivable grew by -0.2% during the same time period ($1,707.32M vs. $1,710.77M y/y). Receivables, as a percentage of current assets, increased from 25.5% to 30.16% during the most recent quarter (comparing 3 months ending 2012-12-31 to 3 months ending 2011-12-31).
  • Nucor also has troubling inventory trends: Inventory grew by 16.93% during the same time period ($2,323.64M vs. $1,987.26M y/y). Inventory, as a percentage of current assets, increased from 29.62% to 41.04% during the most recent quarter (comparing 3 months ending 2012-12-31 to 3 months ending 2011-12-31).

*Dividend data sourced from DRiP, accounting data sourced from Google Finance, all other data sourced from Finviz.

Source: Caution: 7 High Yield Dividend Champions With Accounts Receivable Red Flags