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Dividend Champions, New and Improved

|Includes:Brady Corporation (BRC), BXS, DUK, FL, MDLZ, MKC, NS, SHEN

The Dividend Champions spreadsheet has been updated through 9/30/10

To download the latest version of the U.S. Dividend Champions spreadsheet or PDF, go here: http://dripinvesting.org/Tools/Tools.asp

During the past month, I have again been working on some significant changes to improve the Dividend Champions listing, and those include expansion of the Champions and Contenders tabs to include fundamental data obtained from Yahoo! Finance and the addition of two new tabs to segregate Summary totals from the Champions and Contenders (with charts) and Changes that are company-specific, rather than Revisions to the spreadsheet design. I'll discuss this month's changes in order of the tabs (from left to right).


 

Dividend Champions and Contenders Columns Added

I've added several new columns on the right side of these listings to reflect fundamental data that is available at Yahoo! Finance, and added columns with additional calculations that may be of interest. Data from Yahoo! includes the following:

TTM EPS (or trailing twelve months Earnings Per Share). This is generally the total of the most recently reported four quarters. Since most companies have yet to report third-quarter earnings, this number is currently the sum of the last two quarters of 2009 and the first two quarters of 2010.

PEG Ratio (P/E Ratio divided by Growth Rate). Yahoo explains that this number uses the 5-year future growth rate, so the divisor of this ratio is composed of estimates.

TTM P/Sales (trailing twelve months Price/Sales Ratio). Divides the current price by the total sales in the past twelve months.

MRQ P/Book (Most Recent Quarter Price/Book Ratio). Divides the current price by the book value per share as reported in quarterly filings.

TY Est EPS (This Year Estimated Earnings Per Share). Currently adds together 2010 actual earnings with estimates for the remaining quarters.

NY Est EPS (Next Year Estimated Earnings Per Share). Analysts' consensus for the next fiscal year's earnings per share.

Market Cap (Market Capitalization). Represents the number of shares outstanding multiplied by the market price. Note that I wasn't able to properly “parse” this data, so sorting based on this column will not be very successful. I had better luck separating the 52-week High and Low.

52-week Low is the lowest closing price for the stock in the past year.

52-week High is the highest closing price of the stock in the past year.

In addition to this data, I have inserted columns to calculate the P/E (price/earnings) ratio, based on the current price and the trailing twelve months earnings; the Payout Ratio, based on the TTM EPS and the current dividend rate; Next Year vs. This Year Estimated EPS Growth; and the current price's percentages above the 52-week Low and below the 52-week High. I also “locked titles” so that the header rows and left-most columns (with company name and symbol) always stay in view, which might make scrolling to the right and back a bit more comfortable.

You might notice that some data is not included, such as the companies' Cash and Debt totals and debt-to-capitalization ratio. These are simply not available from Yahoo!, hence their absence. The other important thing to remember is that all of this data has to be taken with a grain of salt. For example, any earnings per share number may or may not have unusual or one-time items, so each ratio that includes it has the prospect of being distorted. The same holds true of estimates in general and, of course, the timing of earnings announcements may have an effect on summary earnings totals. In addition, certain companies may have exaggerated numbers, such as real estate investment trusts (REITs), which typically are judged by Funds From Operation (FFO), not earnings per share. So the gist of all this is that I need to remind everyone that the listing should only be considered a starting point for more in-depth analysis.

Only one new company joined the Champions listing this month, after having graduated from the Contenders list on the occasion of its 25th year of dividend increases. That was Brady Corp. (BRC), a provider of identification and security products. The number of Champions remained the same, due to the deletion of BancorpSouth (BXS), which announced a fourth-quarter dividend that was unchanged and resulted in the total 2010 payout being equal to that of 2009. I have also deleted seven Contenders and 15 Challengers since the last update (August 31) because of the same reason and expect to delete more between now and the end of the year,as other companies fail to extend their streaks. Familiar companies that were recently deleted include Progress Energy (PGN), Foot Locker (FL), and Kraft Foods (KFT).


 

Two New Tabs Added

In order to make the Champions and Contenders tabs more user- and printer-friendly, I moved the summary totals (of prior months' totals) to a new Summary tab. On that tab, I then added a page of charts that show the trends for Number of Companies, Average Price, Average Yield, and Average Percentage (of the latest increase). A second new tab was added to show company-specific changes, which were removed from the Revisions tab. On the Changes tab, there is now a table for companies that have been deleted, including the reason and date of deletion. Below that is a text-based chronological listing of companies that were added or modified in some way. Unnecessary lines were removed from the Revisions tab, which is now intended only for listing spreadsheet or PDF modifications.


 

Final Words

I believe that I have now completed most of the major revisions that I had planned. One possible change that is under consideration (and was mentioned by a commenter) would entail moving the Dividend History data to the Champions and Contenders tabs, locating those columns to the right of existing ones. However, I'm not sure whether users would be comfortable with that arrangement, which might require a lot of scrolling horizontally, so please comment with any opinions – pro or con – about whether that changes would be welcome.

Between now and year-end, I will focus on two main tasks: Deleting companies that fail to extend their streaks, and Adding a column for Total Dividends Paid in 2010. The latter may not appear until November or December and would not replace 2009 in the calculation of 5- and 10-year DGRs until the December 31 update. As to the companies with streaks that are on “death watch,” there are five Champions, 10 Contenders, and 19 Challengers that may be deleted. Taking into account one Contender, McCormick & Co. (MKC), that should graduate to Champion status and two Challengers (NuStar Energy LP (NS) and Shenandoah Telecommunications (SHEN)) that should graduate to Contender status, the projected totals at year-end would be 96 Champions, 124 Contenders, and 179 Challengers, for a total of 399 companies with dividend streaks of at least five years.



Disclosure: Author owns KFT.
Stocks: BRC, BXS, DUK, FL, MDLZ, MKC, NS, SHEN