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The Most Reliable Dividend Stocks On Earth: Kiplinger's International Aristocrats In September

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Includes: ABBV, ADM, BTI, CNQ, ENB, ENGGY, IMBBY, LEG, MEOH, MFGP, MRD, PRU, RDEIY, SKVKY, SU, T, WPP, XOM
by: Fredrik Arnold
Summary

Kiplinger Investing offers "insights for investors" online. This World's Most Reliable list was compiled by Kiplinger in October 2018, data as of 8/27/19.

Most reliable long-term dividend stocks, also known as International “Dividend Aristocrats,” have raised dividends at least five straight years (Canadian firms), 10 years (E.U.-based firms) or 25 years (U.S. companies).

These 98 select dividend stocks ranged 0.52-9.29% in annual yield and ranged -8.67-102.38% in annual price target upsides per brokers 8/27/19.

Top Ten Kiplinger most reliable long-term dividend stocks boasted net gains from 23.12% to 55.43%.

$5k invested in the lowest-priced five top-yield Kiplinger most reliable dividend dogs showed 59.46% less net gain than from $5k invested in all ten. Big high-price Kiplinger reliable dividend stocks led the pack.

Actionable Conclusions (1-10): Analysts Estimated 23.12% To 55.43% Net Gains For Ten Top International Dividend Aristocrat Dogs Into 2020

Three of these ten top Kiplinger most reliable dividend stocks by yield were among the top ten gainers for the coming year based on analyst 1-year target prices. (They are tinted gray in the chart below). Thus, the yield-based forecast for these July dogs was graded by Wall St. Wizards as 30% accurate.

Projections were based on estimated dividends from $1000 invested in each of the highest yielding stocks and their aggregate one-year analyst median target prices, as reported by YCharts. Note: one-year target prices by lone analysts were not applied. Ten probable profit-generating trades projected to August 27, 2020, were:

Source: YCharts.com

Methanex Corp. (MEOH) was projected to net $554.32, based on a median of target price estimates from fourteen analysts, plus dividends, less broker fees. The Beta number showed this estimate subject to risk 69% more than the market as a whole.

WPP PLC (WPP) was projected to net $421.84, based on the median of target estimates from two analysts, plus dividends, less broker fees. The Beta number showed this estimate subject to risk 4% more than the market as a whole.

AbbVie Inc. (ABBV) was projected to net $361.73, based on the median of target price estimates from twelve analysts, plus annual dividend, less broker fees. The Beta number showed this estimate subject to risk 4% more than the market as a whole.

Prudential Financial, Inc. (PRU) was projected to net $335.01 based on dividends, plus the median of target estimates form twenty brokers, less transaction fees. The Beta number showed this estimate subject to risk 49% above the market as a whole.

Canadian Natural Resources (CNQ) was projected to net $330.05, based on a median of target price estimates from twenty-six analysts, plus annual dividend, less broker fees. The Beta number showed this estimate subject to risk 14% more than the market as a whole.

Archer-Daniels-Midland Co. (ADM) was projected to net $304.79, based on dividends, plus a mean target price estimate from fifteen analysts, less broker fees. The Beta number showed this estimate subject to risk 5% more than the market as a whole.

Enbridge (ENB) was projected to net $258.01, based on dividends, plus the median of target price estimates from twenty-three analysts, less broker fees. The Beta number showed this estimate subject to risk 41% less than the market as a whole.

Exxon Mobil Corp. (XOM) was projected to net $256.27, based on dividends, plus a mean target price estimate from twenty-four analysts, less broker fees. The Beta number showed this estimate subject to risk 3% under the market as a whole.

Leggett & Platt, Inc. (LEG) was projected to net $256.13, based on dividends, plus median target price estimates from six analysts, less broker fees. The Beta number showed this estimate subject to risk 8% more than the market as a whole.

Suncor Energy (SU) netted $231.17 based on the median of estimates from twenty-seven analysts, plus dividends. The Beta number showed this estimate subject to risk, 8% more than the market as a whole.

The average net gain in dividend and price was estimated at 33.09% on $10k invested as $1k in each of these ten stocks. These gain estimates were subject to average risks 11% above the market as a whole.

Source: petguide.com

The Dividend Dogs Rule

Stocks earned the "dog" moniker by exhibiting three traits: (1) paying reliable, repeating dividends, (2) their prices fell to where (3) yield (dividend/price) grew higher than their peers. Thus, the highest yielding stocks in any collection became known as "dogs." More precisely, these are, in fact, best called, "underdogs."

98 Kiplinger Most ReliableDividend Stocks On Earth Per September Target Gains

Source: YCharts.com

98 Kiplinger Most Reliable Dividend Stocks On Earth By September Yield

Source: YCharts.com

Actionable Conclusions (11-20): Ten Top International Dividend Dividend Aristocrats By Yield

Top ten International Dividend Aristocrats selected 8/27/19 by yield represented eight of eleven Morningstar sectors. The first two places were claimed by two utilities sector representatives, Enagas SA (OTCPK:ENGGY) [1], and, Red Electrica Corporacion SA (OTCPK:RDEIY) [2].

A lone financial services representatives emerged in third place by yield, Skandinaviska Enskilda Banken AB (OTCPK:SKVKY) [4]. After that, two consumer defensive representatives placed fourth and eighth, British American Tobacco PLC (BTI) [3], and Imperial Brands PLC (OTCQX:IMBBY) [8].

A lone consumer cyclical representative placed fifth WPP PLC [5]. A single energy sector representative placed sixth, Enbridge Inc. [6]. A lone healthcare equity paced seventh, AbbVie Inc. [7]. Then, technology entered the top ten in the form of Micro Focus International PLC (MFGP) [9].

Finally, the lone communications services pup claimed tenth place, AT&T Inc. (T) [10] to complete the Kiplinger most reliable dividend and International Aristocrats top ten by yield for September.

Actionable Conclusions: (21-30) Top Ten Kiplinger Most Reliable Dividend Dogs Showed 13.07-38.85 Upsides While (31) No Downsiders Emerged

Source: YCharts.com

To quantify top dog rankings, analyst mean price target estimates provided a "market sentiment" gauge of upside potential. Added to the simple high-yield metrics, analyst median target price estimates became another tool to dig out bargains.

Analysts Forecast A 59.46% Disadvantage For 5 Highest Yield, Lowest Priced Kiplinger Most Reliable International Dividend Aristocrats To September 2020

Ten top Kiplinger most reliable dividend dogs were culled by yield for this update. Yield (dividend/price) results provided by YCharts did the ranking.

Source: YCharts.com

As noted above, top ten Kiplinger most reliable dividend (MRD) dogs screened 8/27/19 showing the highest dividend yields represented eight of eleven in the Morningstar sector scheme.

Actionable Conclusions: Analysts Predicted 5 Lowest-Priced Of The Top Ten Highest-Yield Kiplinger MRD Dogs (32) Delivering 6.62% Vs. (33) 16.33% Net Gains by All Ten Come September 2020

Source: YCharts.com

$5000 invested as $1k in each of the five lowest-priced stocks in the top ten Dividend Kiplinger most reliable dividend kennel by yield were predicted by analyst 1-year targets to deliver 59.46% less gain than $5,000 invested as $.5k in all ten. The ninth, WPP PLC, was projected to deliver the best net gain of 42.18%.

Source: YCharts.com

The five lowest-priced top-yield Kiplinger most reliable international dividend aristocrat dogs as of August 27 were: Skandinaviska Enskilda Banken AB; Red Electrica Corporacion SA; Enagas SA; Micro Focus International PLC; Imperial Brands PLC, with prices ranging from $8.56 to $25.28.

Five higher-priced Kiplinger most reliable international dividend Aristocrat dogs as of August 27 were: Enbridge Inc.; British American Tobacco PLC; AT&T Inc.; WPP PLC; AbbVie Inc., whose prices ranged from $32.90 to $65.67.

The distinction between five low-priced dividend dogs and the general field of ten reflected Michael B. O'Higgins' "basic method" for beating the Dow. The scale of projected gains based on analyst targets added a unique element of "market sentiment" gauging upside potential. It provided a here-and-now equivalent of waiting a year to find out what might happen in the market. Caution is advised, since analysts are historically only 20% to 80% accurate on the direction of change and just 0% to 20% accurate on the degree of change.

The net gain/loss estimates above did not factor in any foreign or domestic tax problems resulting from distributions. Consult your tax advisor regarding the source and consequences of "dividends" from any investment.

Stocks listed above were suggested only as possible reference points for your International Aristocrat stock purchase or sale research process. These were not recommendations.

Graphs and charts were compiled by Rydlun & Co., LLC from data derived from www.indexarb.com; YCharts.com; finance.yahoo.com; analyst mean target price by Thomson/First Call in YahooFinance. Dog photo: petguide.com

Disclosure: I am/we are long T. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Additional disclosure: This article is for informational and educational purposes only and should not be construed to constitute investment advice. Nothing contained herein shall constitute a solicitation, recommendation or endorsement to buy or sell any security. Prices and returns on equities in this article except as noted are listed without consideration of fees, commissions, taxes, penalties, or interest payable due to purchasing, holding, or selling same.