These are difficult times in the stock markets. August was a bad month and September, traditionally the worst month, could be worse. When the going gets tough, investors should turn to companies with long track records of success. There are a small number of S&P 500 Dividend Aristocrats which have increased annual dividends for a minimum of the last 25 years. First is a list of companies with excellent stock performance in the last decade and then a list of companies for growth and income.
Dover Corporation (NYSE:DOV) operates a global group of manufacturing companies (leaders in niche markets) providing components and equipment, specialty systems and support services for industrial products, engineered systems, fluid management and electronic technologies markets. There are 4 business units: Industrial Products, Engineered Systems, Fluid Management and Electronic Technologies.
VF Corporation (NYSE:VFC) is a leading global apparel company that designs and manufactures a variety of apparel and footwear for all ages. VFC owns popular brands in jeanswear, outerwear, packs, footwear, sportswear and occupational apparel categories marketed to consumers shopping in specialty stores, upscale and traditional department stores, national chains and mass merchants. Brand names include Nautica, The North Face, Vans and Seven For All Mankind. Timberland was acquired in June
Sherwin-Williams (NYSE:SHW) manufactures and sells paint, coatings and related products to professional, industrial and retail customers primarily in North and South America, with additional operations overseas. Its 3 segments are: Paint Stores Group with 3400 specialty paint stores, Consumer Group and Global Finishes Group.
Brown-Forman (BF-B) bottles and markets a variety of alcoholic beverage brands including: Jack Daniel’s Tennessee Whiskey, Gentleman Jack, Southern Comfort, Finlandia Vodka, Antiguo Tequila, Canadian Mist Blended Canadian Whisky, Chambord Liqueur, Don Eduardo Tequila, el Jimador Tequila, Korbel California Champagnes, Old Forester Bourbon, Sonoma-Cutrer Wines and Woodford Reserve Bourbon. Overseas business offers the greatest growth opportunities.
Hormel Foods (NYSE:HRL) produces and markets meat and food products throughout the US and internationally in 5 segments: Grocery Products, Refrigerated Foods, Jennie-O Turkey Store (JOTS), Specialty Foods, and All Other. Internationally, HRL markets its products through Hormel Foods International Corp.
WW Grainger (NYSE:GWW) distributes industrial supplies such as motors, tools, and safety gear for maintenance and repair operations primarily in the US and Canada. GWW markets through sales representatives, direct marketing materials and catalogs. Business is primarily in the US and Canada along with foreign subsidiaries.
|Dover Corporation (DOV)||2.4%||13X|
|VF Corporation (VFC)||2.0%||18X|
|Hormel Foods (HRL)||1.8%||16X|
|WW Grainger (GWW)||1.6%||20X|
Leggett & Platt (NYSE:LEG) is a global diversified manufacturer and engineers components and products for a variety of uses such as spring units used in bedding and chairs. LEG also makes headboards, die-cast products for barbecue grills and lighting fixtures, and store displays and shelving. Its Specialized Products segment offers machinery, manufacturing equipment, automotive seating suspensions, control cable systems and lumbar supports.
Kimberly-Clark (NYSE:KMB) is a global paper company that operates in 4 segments: Personal Care, Consumer Tissue, K-C Professional & Other and Health Care. Brands include Kleenex, Scott, Huggies, Pull-Ups, Kotex and Depend. KMB products hold #1 or #2 share positions in more than 80 countries.
Abbott (NYSE:ABT) manufactures and markets pharmaceuticals, medical devices, blood glucose monitoring kits, and nutritional health-care products including prescription drugs, coronary and carotid stents, and nutritional liquids for infants and adults around the world. There are 4 segments: Pharmaceutical Products, Diagnostic Products, Nutritional Products and Vascular Products. Almost 60% of revenue comes from pharmaceuticals.
Johnson & Johnson (NYSE:JNJ) ranks as the world's largest and most diverse health-care company with more than 250 operating companies worldwide. JNJ is a leader across the major health-care industries and is organized into 3 business segments: Consumer, Pharmaceutical and Medical Devices and Diagnostics. Its global presence is expanding in the BRIC countries: Brazil, Russia, India and China. JNJ has maintained its AAA credit rating.
Clorox (NYSE:CLX) is a manufacturer and marketer of consumer and institutional products, selling its products primarily through mass merchandisers, grocery stores and other retail outlets. Popular brand names include its namesake bleach and cleaning products, Green Works natural cleaning, Fresh Step and Scoop Away cat litter, Kingsford charcoal, Hidden Valley and K C Masterpiece dressings and sauces, Brita water-filtration systems and Glad bags marketed in more than 100 countries.
Emerson Electric (NYSE:EMR), a diversified global technology company, is engaged in designing and supplying product technology and delivering engineering services in a range of industrial, commercial and consumer markets around the world. There are 5 business segments: Process Management, The Industrial Automation, The Network Power, Climate Technologies, and Tools and Storage.
Growth & Income Stocks
|Leggett & Platt (LEG)||5.2%||18X|
|Abbott Labs (ABT)||3.7%||12X|
|Johnson & Johnson (JNJ)||3.5%||13X|
|Emerson Electric (EMR)||3.0%||15X|
The first group has S&P 500 Dividend Aristocrats with strong records of growth in recent years. The stocks have doubled or tripled while popular averages did little. Yields are moderate (although above very low rates available elsewhere). Growing earnings should allow them to extend dividend streaks which will lead to higher stock prices.
The 2nd list has S&P 500 Dividend Aristocrats for investors seeking growth and income. Yields are over 3% and stock charts have little or moderate growth over the last 10 years. EMR and CLX stocks are up more than 60% while the other stocks are pretty much flattish. CLX has an unusual consideration. Carl Icahn is the largest stockholder and made an offer to buy shares he doesn't own for $80 (cash and debt). The outcome is unclear, but his belief that the stock is worth more than the $68 should be heart warming for CLX stockholders.
Dividends are a direct connection between management and investors. Management rewards shareholders with growing dividends and these stocks will help investors get through difficult times. Dividends have been raised during many recessions including the last when many prominent Dividend Aristocrats ended their streaks. Total return comes from high dividend and stock prices. These stocks should deliver favorable results.
Disclosure: I am long VFC.