Old But Still Beautiful

Jan. 28, 2016 11:37 AM ET
Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors.

Contributor Since 2010

Sorry I hide my true identity but I'm a physicist/engineer, native contrarian and idea generator (so Silicon Valley is the natural habitable area for me and I love climate but hate traffic in this part of California). I invested in contrarian/value stocks from the mid-nineties (oh boy it was XX century) without serious success. Therefore, I switched to dividend growth investing /DGI/ in 2006 due to the eureka moment caused by Lowell Miller's book "The single best investment: creating wealth with dividend growth".  From that time I am an eclectic dividend investor with motto "In God We Trust, All Others Pay Cash" applied to companies I invest in. The goal was to exceed my average annual expenses with dividends before retirement, and to have inflation-proof income as a retiree. I did achieve this goal in about a dozen years. Dividends I collect from numerous companies around the globe are about 150% of my average annual expenses.

I like to read /and read a lot - did you look on my SA photo 8-)? / including popular and academic investment books and papers. After 200+ investment books and perhaps even large number of papers I concluded that many (but not all) finance academics failed to delivery a good science because they usually are more concerned about match between their models and limited (in time and place) data-sets than about underlying assumptions of their models (that are often too naive from physicist point of view). On another hand, finance practitioners such as fund managers have different goals than I (for example, they want to outperform or replicate market each single year while my goal is to have good moderate inflation-proof income from my investment and I don't worry to under-perform in a bull market) and to some extend more limited in their choices than I (for example, with micro- and nano-cap stocks). It gives a chance for me as amateur investor to compete successfully with professionals in niche strategies such as global dividend investment (see e.g. http://seekingalpha.com/instablog/725729-sds-seductive-dividend-stocks/266502-why-i-m-a-dividend-zealot-jan-31-2012 although the same ideas and facts were re-used few times in better-written SA articles).

My personal portfolio consists of more than 200 dividend growth (DG) and high yield (HY) stocks of high quality companies with good histories of dividend payments. I also oversee some family members portfolios, so totally we invest in almost 600 different dividend stocks /about 50% US and the rest from 6 continents - we are open to invest into good companies in Antarctica and any planet within 120 light years from the Earth if they pay dividends 8-)/. We all understand that

a) double taxation (that should be forbidden IMHO) theoretically works against dividend investing (but I guess market adjust stock prices for dividend payers vs. other companies);

b) DGI is mostly trust in company's Board of Directors consistency and willingness to increase dividends while HYI is mostly disagreement with market sentiment;

c) no fast money are possible from HYI and especially from DGI, although we rarely use some short-time opportunities (e.g., dividends rain during 2012 Fiscal Cliff);

but both above-mentioned styles fit my mentality and we share the same goal that I specified back in 2006 across all portfolios. 

My investor edges are

i) patience as well as independence in time frames and market exposures forbidden for many finance practitioners;

ii) critical scientific approach (used in natural science rather than in liberal sciences) to finance academics' ideas and strong selection between useful and worthless findings;

iii) proprietary forecast of dividend reductions in about a year ahead delivered from mix of finance data, engineering hardware reliability ideas, some physics concepts with behavior signals;

iv) willingness invest in dividend companies that are too small for institutional investors.

I rather put my thoughts and ideas in SA blog-posts (https://seekingalpha.com/user/725729/instablogs#instablogs)  and in comments than in articles (I'm pretty busy/lazy/English-incompetent to perfect a good smoothly-readable article) but in all cases all standard disclaimers are applied. One of good things I have learned in Intel R&D, that decision should be data driven. So I try to supply my ideas and thoughts with most relevant data. I love Russian playwright Anton Chekhov's principle "Brevity is the sister of talent" and think it is even more important nowadays with ocean of information in front of any investor. So, I try to follow this principle in my SA blog posts and comments but please remember that "If I have more time, I would have written shorter". Being a scientific journals referee I have a bad habit to find few weak points in almost any manuscript, so I probably too critical in some comments but I hope the article authors excuse me and agree that "veritas" is not only "in vino" but rather in the discussions.

I prefer communicate via SA email rather than inside comments (I usually turn off "Track new comments on this article" SA's feature). So send me a SA email if you have a question or would like to discuss my point of view.

I prefer to buy companies with good dividend growth (DG) culture and perspectives and do not sold them. The rule of thumb for dividend growth investors' (DGis) investment horizon is 100 - your age.
Why 100? - Average lifetime now is ~ 85 years but this is for ALL seniors most of them do not SWAN because they are not DGis 8-). If DGis want to pass their stocks to kids and/or grandkids their investment horizon should exceed a century.

Unfortunately average life-time of public company is about 25 years now (http://priceonomics.com/why-are-so-many-of-the-worlds-oldest-businesses-in/) i.e. more than 2X less than my investment horizon particularly due to creative disruption (http://www.technologyreview.com/view/519226/technology-is-wiping-out-companies-faster-than-ever/) in which I actively participate. Moreover, 52% of fortune 500 firms since 2000 are gone (https://www.linkedin.com/pulse/20141013064938-24873921-fragile-business-anti-fragile-business) mostly because of business underperformance (bad for investors) or mergers & acquisitions (not so bad for investors).

So I performed search for US and Canadian companies which are already 100+ years in business using S&P database. The results are below. Please note that I did catch (and fixed) some mistakes in dividend histories but I didn't verify the age of company. Generally USA and Canada economy are relatively young as well as some fields (e.g. software) created recently.

- trade

- food/drink production

- bank

- housing/lodging

- transportation

- arm production & defense

- entertainment

- apparel

but world progress accelerates and I'd not limit myself only with "proven fields" and invest in "young fields". Also industry field itself might be very stable but players are not (e.g. fashion in apparel) or field itself changes with time (who will own typewriter or invest in gladiator stadiums now?).

There are US/Canadian businesses which are at least century years old:

  Public companies 100 years old or more
Symbol Company Established Dividends Paid Since S&P Sub-Industry
BK The Bank of New York Mellon Corporation 1784 1785 Asset Management & Custody Banks
CI CIGNA Corporation 1792 1867 Managed Health Care
DD EI DuPont de Nemours & Co. 1802 1904 Diversified Chemicals
CL Colgate-Palmolive Co. 1806 1895 Household Products
VAL The Valspar Corporation 1806 1964 Specialty Chemicals
JW.A John Wiley & Sons Inc. 1807 1982 Publishing
C Citigroup, Inc. 1812 2011 Diversified Banks
YORW York Water 1816 1816 Water Utilities
WBK Westpac Banking ADR 1817 1817 Diversified Banks
JPM JPMorgan Chase & Co. 1823 1827 Diversified Banks
BMO Bank of Montreal/Marshall & Ilsley Corporation 1829 1829 Diversified Banks
STT State Street Corp. 1832 1910 Asset Management & Custody Banks
MCK McKesson Corporation 1833 1995 Health Care Distributors
BNS Bank of Nova Scotia 1834 1834 Diversified Banks
PG Procter & Gamble Co. 1837 1891 Household Products
DE Deere & Company 1837 1937 Agricultural & Farm Machinery
PBCT People's United Financial Inc. 1842 1993 Regional Banks
SAL Salisbury Bancorp Inc. 1848 1998 Regional Banks
LAZ Lazard Ltd. 1848 2005 Investment Banking & Brokerage
PFE Pfizer Inc. 1849 1901 Pharmaceuticals
AXP American Express Company 1850 1870 Consumer Finance
GLW Corning Inc. 1851 2007 Electronic Components
WGL WGL Holdings 1852 1852 Gas Utilities
WFC Wells Fargo & Company 1852 1939 Diversified Banks
TRV The Travelers Companies, Inc. 1853 2003 Property & Casualty Insurance
GAS AGL Resources Inc. 1856 1939 Gas Utilities
TD Toronto-Dominion Bk 1857 1857 Diversified Banks
BMS Bemis Company, Inc. 1858 1922 Paper Packaging
MBTF MBT Financial Corp. 1858 2000 Regional Banks
DNBF DNB Financial Corp. 1860 1995 Regional Banks
UNP Union Pacific Corporation 1862 1900 Railroads
NOV National Oilwell Varco, Inc. 1862 2009 Oil & Gas Equipment & Services
USB U.S. Bancorp 1863 1863 Diversified Banks
RRD R.R. Donnelley & Sons Company 1864 1911 Commercial Printing
IBCP Independent Bank Corporation 1864 2014 Regional Banks
PNC PNC Financial Services Group 1865 1865 Regional Banks
HWBK Hawthorn Bancshares, Inc. 1865 1995 Regional Banks
HBCP Home Bancorp (Britton & Koontz Capital Corp.) 1866 2014 Thrifts & Mortgage Finance
ACU Acme United Corp. 1867 2004 Office Services & Supplies
PKG Packaging Corp. of America 1867 2004 Paper Packaging
CFR Cullen/Frost Bankers, Inc. 1868 1993 Regional Banks
MET MetLife, Inc. 1868 2000 Life & Health Insurance
MPB Mid Penn Bancorp Inc. 1868 2011 Regional Banks
ESBK Elmira Savings Bank 1869 1988 Thrifts & Mortgage Finance
GS The Goldman Sachs Group, Inc. 1869 1999 Investment Banking & Brokerage
WBC WABCO Holdings Inc. 1869 2007 Construction Machinery & Heavy Trucks
RY Royal Bank Canada 1870 1870 Diversified Banks
XOM Exxon Mobil Corporation 1870 1882 Integrated Oil & Gas
FNFG First Niagara Financial Group Inc. 1870 1998 Regional Banks
SMG The Scotts Miracle-Gro Company 1870 2005 Fertilizers & Agricultural Chemicals
LB.C Laurentian Bank, Canada 1871 1871 Regional Banks
MMC Marsh & McLennan Companies, Inc. 1871 1923 Insurance Brokers
KMB Kimberly-Clark Corporation 1872 1935 Household Products
AFG American Financial Group Inc. 1872 1987 Multi-line Insurance
NBN Northeast Bancorp 1872 1988 Regional Banks
ZION Zions Bancorp. 1873 1966 Regional Banks
BAC Bank of America Corporation 1874 1903 Diversified Banks
RAI Reynolds American Inc. /Lorillard, Inc. 1875 /1760 1999 Tobacco
RIVR River Valley Bancorp 1875 1997 Thrifts & Mortgage Finance
PRU Prudential Financial, Inc. 1875 2002 Life & Health Insurance
LLY Eli Lilly & Co. 1876 1885 Pharmaceuticals
PVH Phillips-Van Heusen Corp. 1876 1970 Apparel, Accessories & Luxury Goods
SWK Stanley Black & Decker 1877 1877 Industrial Machinery
GEF Greif, Inc. 1877 1926 Metal & Glass Containers
PDCO Patterson Companies Inc. 1877 2010 Health Care Distributors
CVX Chevron Corporation 1879 1912 Integrated Oil & Gas
FL Foot Locker, Inc. 1879 2003 Apparel Retail
BCE BCE Inc 1881 1881 Integrated Telecommunication Services
UGI UGI Corp. 1882 1885 Gas Utilities
CB The Chubb Corporation 1882 1902 Property & Casualty Insurance
PPG PPG Industries Inc. 1883 1899 Specialty Chemicals
NSC Norfolk Southern Corp. 1883 1901 Railroads
LEG Leggett & Platt, Incorporated 1883 1939 Home Furnishings
BTU Peabody Energy Corp. 1883 2001 Coal & Consumable Fuels
KR The Kroger Co. 1883 2006 Food Retail
ED Consolidated Edison Inc. 1884 1885 Multi-Utilities
CIVB Civista Bancshares /First Citizens Banc Corp./ 1884 1994 Regional Banks
LVLT Level 3 Communications Inc. (LLL?) 1884 2004 Alternative Carriers
NCR NCR Corp. 1884 2007 Technology Hardware, Storage & Peripherals
JCI Johnson Controls Inc. 1885 1887 Auto Parts & Equipment
KO The Coca-Cola Company 1886 1893 Soft Drinks
AVP Avon Products Inc. 1886 1919 Personal Products
JNJ Johnson & Johnson 1886 1944 Pharmaceuticals
EIX Edison International 1886 2004 Electric Utilities
AWK American Water Works Company, Inc. 1886 2008 Water Utilities
SUN Sunoco, Inc. 1886 2012 Oil & Gas Storage & Transportation
SIEB Siebert Financial Corp. 1886 1990 Investment Banking & Brokerage
NST NSTAR/Northern Star Resources Limited 1886 2012 Gold
HON Honeywell Intl 1887 1887 Aerospace & Defense
OCX.C Onex Corp 1887 1887 Multi-Sector Holdings
BMY Bristol-Myers Squibb Company 1887 1900 Pharmaceuticals
EXC Exelon Corp. 1887 1902 Electric Utilities
ORI Old Republic International Corp. 1887 1942 Property & Casualty Insurance
MRO Marathon Oil Corporation 1887 1991 Oil & Gas Exploration & Production
SMBC Southern Missouri Bancorp, Inc. 1887 1995 Thrifts & Mortgage Finance
ABT Abbott Laboratories 1888 1926 Health Care Equipment
HUB.B Hubbell Inc. 1888 1934 Electrical Components & Equipment
MHP The McGraw-Hill Companies, Inc. 1888 1937 Specialized Finance
AA Alcoa, Inc. 1888 1939 Aluminum
UCFC United Community Financial Corp. 1889 2014 Thrifts & Mortgage Finance
CM Canadian Imperial Bk Commerce 1890 1890 Diversified Banks
EMR Emerson Electric Co. 1890 1947 Electrical Components & Equipment
RNST Renasant Corp (First M&F Corp.) 1890 1987 Regional Banks
ASBI Ameriana Bancorp 1890 1988 Regional Banks
IMO Imperial Oil Ltd 1891 1891 Integrated Oil & Gas
MRK Merck & Co. Inc. 1891 1935 Pharmaceuticals
STI SunTrust Banks, Inc. 1891 1985 Regional Banks
FCAP First Capital Inc. 1891 1999 Thrifts & Mortgage Finance
GE General Electric Co. 1892 1899 Industrial Conglomerates
CVS CVS Caremark Corporation 1892 1916 Drug Retail
CFBK Central Federal Corp. 1892 1999 Thrifts & Mortgage Finance
JOB General Employment Enterprises Inc. 1893 1994 Human Resource & Employment Services
FRME First Merchants Corp 1894 1894 Regional Banks
MBWM Mercantile Bank (Firstbank Corporation) 1894 2003 Regional Banks
AMP Ameriprise Financial Inc. 1894 2005 Asset Management & Custody Banks
LECO Lincoln Electric Holdings Inc. 1895 1915 Industrial Machinery
NTRS Northern Trust 1896 1896 Asset Management & Custody Banks
POM Pepco Holdings, Inc. 1896 1904 Electric Utilities
DOW The Dow Chemical Company 1897 1911 Diversified Chemicals
BDX Becton, Dickinson and Company 1897 1926 Health Care Equipment
GIS Genl Mills 1898 1898 Packaged Foods & Meats
ADM Archer Daniels Midland Company 1898 1927 Agricultural Products
IP International Paper Co. 1898 1946 Paper Products
PEP Pepsico, Inc. 1898 1952 Soft Drinks
FFDF FFD Financial Corp. 1898 1996 Regional Banks
CME CME Group Inc. 1898 2003 Specialized Finance
GT Goodyear Tire & Rubber Co. 1898 2013 Tires & Rubber
AVA Avista Corp 1899 1899 Multi-Utilities
BOH Bank of Hawaii 1899 1899 Regional Banks
TE TECO Energy, Inc. 1899 1900 Multi-Utilities
EFX Equifax Inc. 1899 1914 Research & Consulting Services
TKR Timken Co. 1899 1922 Industrial Machinery
SON Sonoco Products Co. 1899 1925 Paper Packaging
GD General Dynamics Corp. 1899 1979 Aerospace & Defense
LM Legg Mason Inc. 1899 1983 Asset Management & Custody Banks
BAM Brookfield Asset Management (GrafTech International Ltd.) 1899 1989 Diversified Real Estate Activities
WAYN Wayne Savings Bancshares Inc. 1899 1993 Thrifts & Mortgage Finance
S Sprint Nextel Corp. 1899 1984 Wireless Telecommunication Services
UIL UIL Holdings 1900 1900 Electric Utilities
TMK Torchmark Corp. 1900 1933 Life & Health Insurance
CRRB Bay Bancorp (Carrollton Bancorp) 1900 1994 Regional Banks
FUNC First United Corporation 1900 1992 Regional Banks
EMCF Emclaire Financial Corp. 1900 2001 Regional Banks
CHD Church & Dwight 1901 1901 Household Products
HE Hawaiian Elec Indus 1901 1901 Electric Utilities
WAG Walgreens Boots Alliance Holding Company 1901 1933 Pharmaceutical Retailers
CPB Campbell Soup 1902 1902 Packaged Foods & Meats
MATX Matson Inc 1902 1902 Marine
MMM 3M Co. 1902 1916 Industrial Conglomerates
TGT Target Corp. 1902 1965 General Merchandise Stores
FBSS Fauquier Bankshares Inc. 1902 1998 Regional Banks
NAV Navistar International Corp. 1902 1970 Construction Machinery & Heavy Trucks
NFG Natl Fuel Gas 1903 1903 Gas Utilities
F Ford Motor Co. 1903 2012 Automobile Manufacturers
JW.B Wiley(John)Sons 'B' 1904 1904 Publishing
UBOH United Bancshares Inc. 1904 2012 Regional Banks
PCAR PACCAR Inc. 1905 1943 Construction Machinery & Heavy Trucks
CHRW CH Robinson Worldwide Inc. 1905 1997 Air Freight & Logistics
PCG PG & E Corp. 1905 2005 Multi-Utilities
MJN Mead Johnson Nutrition Company 1905 2009 Packaged Foods & Meats
BBT BB & T Corp. 1906 1903 Regional Banks
AEE Ameren Corp 1906 1906 Multi-Utilities
AEP American Electric Power Co., Inc. 1906 1909 Electric Utilities
K Kellogg Company 1906 1923 Packaged Foods & Meats
ATO Atmos Energy Corporation 1906 1984 Gas Utilities
KEQU Kewaunee Scientific Corp. 1906 1996 Health Care Equipment
INGR Ingredion Inc (Corn Products International Inc.) 1906 1998 Agricultural Products
XRX Xerox Corp. 1906 2008 Data Processing & Outsourced Services
GCI Gannett Co., Inc. 1906 2015 Publishing
HH Hooper Holmes Inc. 1906 1987 Health Care Services
CRS Carpenter Technology 1907 1907 Steel
KCLI Kansas City Life Ins 1907 1907 Life & Health Insurance
PEG Public Svc Enterprises 1907 1907 Multi-Utilities
PX Praxair Inc. 1907 1992 Industrial Gases
COB CommunityOne Bancorp (FNB United Corp. + Bank of Granite Corporation) 1907 1996 Regional Banks
UPS United Parcel Service, Inc. 1907 2000 Air Freight & Logistics
OGE OGE Energy 1908 1908 Electric Utilities
UTL UNITIL Corp 1908 1908 Electric Utilities
WMB Williams Companies, Inc. 1908 1974 Oil & Gas Storage & Transportation
SM SM Energy Company 1908 1993 Oil & Gas Exploration & Production
DTE DTE Energy 1909 1909 Multi-Utilities
MGEE MGE Energy 1909 1909 Electric Utilities
D Dominion Resources, Inc. 1909 1925 Multi-Utilities
VMC Vulcan Materials Company 1909 1934 Construction Materials
IFF International Flavors & Fragrances Inc. 1909 1956 Specialty Chemicals
LMT Lockheed Martin Corporation 1909 1995 Aerospace & Defense
FBIZ First Business Financial Services, Inc. 1909 2006 Regional Banks
IR Ingersoll-Rand Plc 1910 1910 Industrial Machinery
XEL Xcel Energy 1910 1910 Electric Utilities
IBM International Business Machines 1911 1916 IT Consulting & Other Services
HBAN Huntington Bancshares 1912 1912 Regional Banks
MSEX Middlesex Water 1912 1912 Water Utilities
CAT Caterpillar Inc 1914 1914 Construction Machinery & Heavy Trucks
MSA MSA Safety 1916 1918 Office Services & Supplies
BP BP p.l.c. ADS 1917 1917 Integrated Oil & Gas
IDA Idacorp Inc 1917 1917 Electric Utilities
BRK.A Berkshire Hathaway Inc. 1889 no div Multi-Sector Holdings
BW The Babcock & Wilcox Company 1867 no div Heavy Electrical Equipment
GV Goldfield Corp. 1906 no div Construction & Engineering
OI Owens-Illinois, Inc. 1903 no div Metal & Glass Containers
SIRO Sirona Dental Systems Inc. 1882 no div Health Care Equipment
YAMA Yuma Energy (Pyramid Oil Company) 1909 Suspended Preferred Stock dividends in Nov 2015 Oil & Gas Exploration & Production
(MPAC) MOD-PAC Corp. 1881 Private from 2013 Paper Packaging
(NVE) NV Energy, Inc. 1906 Now subsidiary of Berkshire Hathaway  
(DUCK) Duckwall-ALCO Stores Inc. 1901 bankruptcy Discount Retail
TEG Integrys Energy Group, Inc. 1883 Probably acquisition or private  
TNB Thomas & Betts Corp. 1898 Probably acquisition or private  
URS URS Corporation 1904 Probably acquisition or private  
WAB Westinghouse Air Brake Technologies Corporation 1869 Probably acquisition or private  
GRNB Green Bankshares, Inc. 1890 Probably acquisition or private  
HCBK Hudson City Bancorp, Inc. 1868 Probably acquisition or private  
LNBB LNB Bancorp Inc. 1905 Probably acquisition or private  
LSBI LSB Financial Corp. 1869 Probably acquisition or private  
MFLR Mayflower Bancorp, Inc. 1889 Probably acquisition or private  
PNBC Princeton National Bancorp Inc. 1865 Probably acquisition or private  

~ Same as picture:

Although these companies are old some of them are still beautiful and I invest in such beauties.

I have to point that famoust phrase "Past performance does not guarantee future results." is applicable to these old companies and DG firms (see seekingalpha.com/instablog/725729-sds-se...). Moreover I have observed that some companies erased their financial and dividend history from public databases (e.g. Yahoo, WSJ), so I'd say "Past performance IS not guaranteed" in financial world. So do your DD before invest in ANY company or fiancial instrument.

SDS 28 Jan 2016

Disclosure: I am/we are long IN SOME MENTIONED STOCKS.

Recommended For You


To ensure this doesn’t happen in the future, please enable Javascript and cookies in your browser.
Is this happening to you frequently? Please report it on our feedback forum.
If you have an ad-blocker enabled you may be blocked from proceeding. Please disable your ad-blocker and refresh.