Dividend Growth Investor

Good Debt Coverage for Sustainable Dividends

LTW,

Did you actually read the article?

Here are some highlights for you:

Some investors typically focus on debt to total assets to gain a perspective on the amount of the leverage the company has. While this method is widely accepted by some investors, I believe that it has some shortcomings, which might prevent investors from seeing the bigger picture. Most importantly comparing debt to total assets does not tell whether a company could service its debt obligations or not.


Dividend investors should generally look for a higher coverage ratio of interest payments. A lower coverage indicates that a decline in earnings could generally make it difficult for the company to service its debt, which could not only jeopardize its dividend payments but also could lead to bankruptcy down the road.


On Oct 14 09:27 PM long term wag holder wrote:

> I don'tunderstand this article. I understand a lot about debt, but
> the numbers in this chart are not explained very well

These 47 S&P 500 Dividend Aristocrats Are Good Investment Opportunities

THofler,

Most Aristocrats would generate very good inflation adjusted streams of dividend income. For example some investors who purchased JNJ, PG, MCD, MO 15-20 years ago are now generating double digit yields on cost. MLPs are great for now, but what happens if the US government decides to abolish the MLP structure ( just like the canadian government decided to abolish the income tax structure iby 2011)? chances are yields on MLPs would drop..

In addition to that, when interest rates start increasing,MLPs might be affected negatively in the process.


On Jul 15 11:40 PM THofler wrote:

> I happily own 4 of the above, as well as a few Master Limited Partnerships.
> The more I learn about the MLPs the more I wonder why I should own
> anything else? They are tax advantaged & pay high distribution
> yields. Check out the info at the web site below, especially the
> presentations and publications page,
>
> naptp.org
>
> Why own the aristocrats? For diversification, of course, since MLPs
> are entirely in the energy space.
>
> I also like most any foreign high dividend stock with a good future.
> Since the dollar has recovered some of its value in the FX markets
> in recent months, now is a good time to move some of one's portfolio
> out of the dollar and into these foreign stocks ahead of the next
> dollar decline. I like the Euro integrated oils (BP, E, TOT) and
> recently picked up some of the Brazilian utility CPFL Energia (seekingalpha.com/symbo...).

These 47 S&P 500 Dividend Aristocrats Are Good Investment Opportunities

Avy,

There are several companies on your " list", which have cut dividends in 2009 several months ago.Ganett (GCI) and Legg Mason (LM) are such examples.

Rohm and Haas(ROH) which is also on your list, has been bought out by Dow Chemical several months ago as well.

Check these articles below for an up-to date list of the dividend aristocrats to avoid in 2009:

www.dividendgrowthinve...

www.dividendgrowthinve...

Best Regards,

Dividend Growth Investor

Attractive Dividend Stocks in the Buy Zone

Rich,

You might also want to check this article out.

seekingalpha.com/artic...

Attractive Dividend Stocks in the Buy Zone

For those investors who don't have any funds to invest now, they could re-invest their dividend payments or hold tight.

The hammer, actually most of the P/E's on the stocks in the list are below 15.

Dividend Aristocrats Handily Outperforming Main Indexes in 2008

Great resource David!
It's great to see that dividends are cushioning the losses for investors this year. To everyone else who believes that this is a short term phenomenon, please check this link out:

dividendgrowth.blogspo...