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These are our most recent articles. Also see which stocks have been this week’s best and worst performers.
Emerson Electric (EMR): A Safe 4.1% Dividend Yield for Patient Investors
EMR’s stock price has plunged by more than 25% in 2015. Many of the company’s markets are being impacted by falling oil prices, sluggish industrial spending trends, manufacturing weakness in China, and a strong US dollar. We believe the company’s dividend is very safe and will continue to grow each year, maintaining EMR’s status as one of the 52 dividend aristocrats. Beyond the dividend, we think EMR’s current stock price offers attractive returns for long-term dividend investors who are willing to wait out volatility in the company’s markets. With so much attention being given to EMR’s challenging markets and dismal outlook for the next year, we believe the company’s restructuring activities, significant portfolio realignment, and opportunity for long-term earnings [...]
5 Tips to Find Safer Stocks
While dividends have historically accounted for 20-40% of the stock market's total return, dividend investors need to remember that changes in the stock's price still account for the majority of returns. In our opinion, some of the biggest factors that can determine how much a stock moves are: (1) the industry it operates in; (2) the amount of operating leverage in its business model; (3) the amount of financial leverage on the balance sheet; (4) the size of the company; and (5) the current valuation multiple. Many investors seeking sources of safe, current income focus almost exclusively on the current dividend yield, the payout ratio, and maybe the price-to-earnings ratio ("P/E"). And why not? After all, this is the easiest [...]
The 10 Best-Performing Dividend Stocks During Q3
With Q3 wrapping up last week, what did we learn from the market? One helpful form of analysis is to look at the best performing dividend stocks to see if any trends emerge. Our search for the 10 best dividend stocks of Q3 looked at dividend-paying stocks with market caps greater than $400 million and a current dividend yield of at least 2%. We also excluded stocks that received offers to be acquired. The third quarter was marked by extreme market volatility compared to recent years, and the S&P 500 ended up dropping by more than 6%. As Q3 progressed, stock market volatility increased as macro data continued disappointing, capped off by last week’s underwhelming US payroll report. According to an [...]
General Motors (GM) – An Unloved 4.6% Dividend Yield
GM has been nothing short of an extremely disappointing business (and investment) for more than a decade. Market share losses, chronically unprofitable operations, ballooning pension and healthcare obligations, safety issues, vehicle recalls, a massive government bailout during the financial crisis, and more have left investors’ skeptical of GM since its relisting in late 2010. More recently, uncertainty in China (GM’s second largest market) and a potentially peaking automotive market have created additional anxiety about making an investment in the company. We think the new GM is a much healthier, structurally more competitive company that is attractively priced with a 4.6% dividend yield and a 2016 forward earnings multiple of about 6x. GM was added to our Top 20 Dividend Stocks [...]