Vodafone Faces More Uncertainty Amid Dividend Cut Rumors

In October 2018, we reviewed Vodafone's (VOD) dividend safety and made the following remarks (see our full note here): Vodafone's "Borderline Safe" Dividend Safety Score is hanging by a thread. With the dividend consuming the bulk of Vodafone's free cash flow, plus rising leverage from the Liberty Global deal, the capital-intensive nature of its businesses, and very competitive telecom markets in Europe, there is little room for error. As conservative income investors, we prefer to stick with financially stronger businesses that score closer to 60 or higher for Dividend Safety. Regardless, Vodafone shareholders should make sure they are comfortable with these risks, as well as the size of their position and their overall portfolio diversification. The next year could be volatile for Vodafone [...]

May 13th, 2019|

Hershey Has Paid Uninterrupted Dividends Since 1930

Founded in 1894 in Hershey, Pennsylvania, Hershey (HSY) manufactures and sells chocolate and non-chocolate confectionery products including gum and mints; baking ingredients such as toppings, beverages, and syrups; and snack items, including spreads, meat snacks, bars, mixes, popcorn, protein bars, and cookies.These products are marketed under over 80 leading brands including: Hershey’s, Reese’s, Kisses, Jolly Rancher, Almond Joy, Brookside, barkTHINS, Cadbury, Good & Plenty, Heath, Kit Kat, Payday, Rolo, Twizzlers, Whoppers, York, Scharffen Berger, Dagoba, Ice Breakers, Breathsavers, SkinnyPop, Krave, and Bubble Yum.  Internationally (the company sells in over 90 countries), the company's brands include Pelon Pelo Rico, IO-IO, Nutrine, Maha Lacto, Jumpin, Sofit, Oatmega, Paqui, and Tyrrells.

May 13th, 2019|

Simon Property Group: A High-Yield REIT Adapting to the Times

Simon Property Group (SPG) is America’s largest mall owner, with full or partial ownership interest in over 230 properties across North America, Europe, and Asia. In 2018 Simon's U.S. mall tenants generated over $60 billion in retail sales.  Most of Simon's locations are anchored by department stores, and the vast majority of net operating income, or NOI, is derived from the company's U.S. malls (48% of NOI) and premium outlet centers (42%), which are essentially groups of discounted luxury stores.  Simon's U.S. malls and outlets, which accounted for 79% of NOI in 2018, are concentrated in large and relatively fast-growing states, including Florida (16% of NOI), California (13%), Texas (10%), and New York (7%). The company's premium super regional mall [...]

May 13th, 2019|

Why 3M Remains a Long-term Hold

Shares of 3M (MMM) have slumped 20% since April 24th, falling to their lowest level since early 2017. The stock's dividend yield now sits at 3.3%, a level not seen other than in 1995 and during the financial crisis. Investors aren't giving 3M much credit for its long-term track record of creating meaningful shareholder value and growing its dividend for 61 consecutive years. Let's take a closer look at this dividend king to understand why the market is so bearish on the company and if 3M's long-term outlook appears to remain intact.

May 10th, 2019|
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