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Dividend stocks and their compound annual growth rates


I'd like to let everyone know about my new web site, www.tessellation.com/dividends/index.html

This is a site that provides stock dividend information.

I believe the most important piece of information I provide here is the compound annual growth rate (OTCPK:CAGR) for each stock.

As far as I know, this piece of information is not available anywhere on the Internet.

Click here to read about the definition of CAGR, and to see the formula that I use to compute it for each stock.

Here's an example to help understand the concept of CAGR:

Suppose stock ABC pays the following dividends for the following years:
Year 1: $ 1.00000Year 2: $ 1.35000 ( 35.000% increase from previous year)Year 3: $ 1.86000 ( 37.778% increase from previous year)Year 4: $ 2.83000 ( 52.151% increase from previous year)Year 5: $ 3.41000 ( 20.495% increase from previous year)Year 6: $ 3.81000 ( 11.730% increase from previous year)Year 7: $ 4.17000 ( 9.449% increase from previous year)Year 8: $ 5.06000 ( 21.343% increase from previous year)Year 9: $ 5.08000 ( 0.395% increase from previous year)Year 10: $ 5.69000 ( 12.008% increase from previous year)Year 11: $ 6.65000 ( 16.872% increase from previous year)Year 12: $ 7.28000 ( 9.474% increase from previous year)Year 13: $ 8.17000 ( 12.225% increase from previous year)Year 14: $ 8.40000 ( 2.815% increase from previous year)Year 15: $ 8.69000 ( 3.452% increase from previous year)Although the dividend increases each year, the amount and percent of the increase varies each year.

The CAGR allows us to "smooth" out the percentages of the increases, which would have looked like this had the percentages been constant:
Year 1: $ 1.00000Year 2: $ 1.16701 ( 16.701% increase from previous year)Year 3: $ 1.36190 ( 16.701% increase from previous year)Year 4: $ 1.58935 ( 16.701% increase from previous year)Year 5: $ 1.85478 ( 16.701% increase from previous year)Year 6: $ 2.16453 ( 16.701% increase from previous year)Year 7: $ 2.52602 ( 16.701% increase from previous year)Year 8: $ 2.94788 ( 16.701% increase from previous year)Year 9: $ 3.44019 ( 16.701% increase from previous year)Year 10: $ 4.01472 ( 16.701% increase from previous year)Year 11: $ 4.68520 ( 16.701% increase from previous year)Year 12: $ 5.46766 ( 16.701% increase from previous year)Year 13: $ 6.38078 ( 16.701% increase from previous year)Year 14: $ 7.44641 ( 16.701% increase from previous year)Year 15: $ 8.69000 ( 16.701% increase from previous year)Note that the dividends paid in the first and last years are the same as they were above.

I believe this gives us a useful metric with which to compare various dividend stocks.

For example, to compare the CAGR's of dividend stocks from (let's say) 1982 to 2009, click here. All of the stocks that I'm covering (see next paragraph), who had a positive CAGR between 1982 and 2009, are rank-ordered on that page.

I've chosen to cover the stocks in Dividend4Life's list of stocks. It contains Dividend Aristocrats, Champions, and Achievers. His list is available here.

The first year used in this site is 1962, the first year for which any of the stocks I cover have a positive CAGR. Clearly not all stocks have been paying dividends for all that time.

The last year used in this site is 2009, the last full calendar year.

I want to publicly thank (in alphabetical order) David Fish, Dividends4Life, Dividend Growth Investor, Low Sweat Investing, and mbkelly75 for their many helpful and constructive suggestions on a beta version of this web site.



Disclosure: Long ADM, ADP, AFL, APD, AVP, AVY, BCR, BDX, BF.B, BMS, BRK.B, CAG, CAT, CB, CHRW, CINF, CL, CLX, COST, CTAS, DBD, DD, DE, DEO, DIS, DOV, EMR, EV, EXPD, FAST, FDO, FUL, GIS, GPC, GWW, HD, HNZ, HRB, ITW, JCI, JNJ, JWN, K, KMB, KO, LANC, LEG, LOW, MCD, MDT, MKC, MMM, MO, MON, NDSN, PAYX, PBI, PEP, PG, PGR, PH, PNR, PPG, PX, RPM, SHW, SIAL, SJM, SPLS, SWK, SYY, TGT, UTX, VFC, WAG, WMT, WTR, XOM, YUM