10-19-2014, 04:41 PM
Lewys,
I think you're looking at a lot of the right metrics and answering a lot of your own questions, which is a great way to learn.
I won't speak much to how RR stacks up because I think if I was in your position, just starting out-ish, minimal capital, ie. a small snowball, I'd be looking primarily at two things:
1) Proven track record of increasing dividend payments
2) Higher yields
I'd look for a proven track record of increasing dividends payments so statements like "there are fears that it could struggle to fully cover it's dividend payment this year" would not be in my vernacular. I don't want to worry / guess if a company I give my money to will be able to pay me the dividends I'm expecting
And I'd look for higher yields so you can start growing your snowball faster. 2.6% yield with an estimated growth rate of 9% is great, we've all got multiple companies with that profile in our portfolios. But there's better out there. Quality companies with proven track records that can pay you back faster.
Fortunately you can find the answer to both in one spot: US Dividend Champions
This is a spreadsheet of US companies that have paid a dividend that has increased from year to year for 25+ straight years ( Champions ), 10-24 straight years ( Contenders ), and 5-9 straight years ( Challengers ).. You'll see this list mentioned a lot. Daily even. This spreadsheet is pretty much the bible of current companies most Dividend Growth Investors are researching.
I'd start with the Champions tab and then sort by yield.
MO
T
CVX
CLX
KMB
MCD
PG
Those all yield over 3% and have paid an increasing dividend for 25+ years. If I was in your shoes I'd look at that spreadsheet, familiarize yourself with the companies and then pick something that gets you excited to own.
Good luck
I think you're looking at a lot of the right metrics and answering a lot of your own questions, which is a great way to learn.
I won't speak much to how RR stacks up because I think if I was in your position, just starting out-ish, minimal capital, ie. a small snowball, I'd be looking primarily at two things:
1) Proven track record of increasing dividend payments
2) Higher yields
I'd look for a proven track record of increasing dividends payments so statements like "there are fears that it could struggle to fully cover it's dividend payment this year" would not be in my vernacular. I don't want to worry / guess if a company I give my money to will be able to pay me the dividends I'm expecting
And I'd look for higher yields so you can start growing your snowball faster. 2.6% yield with an estimated growth rate of 9% is great, we've all got multiple companies with that profile in our portfolios. But there's better out there. Quality companies with proven track records that can pay you back faster.
Fortunately you can find the answer to both in one spot: US Dividend Champions
This is a spreadsheet of US companies that have paid a dividend that has increased from year to year for 25+ straight years ( Champions ), 10-24 straight years ( Contenders ), and 5-9 straight years ( Challengers ).. You'll see this list mentioned a lot. Daily even. This spreadsheet is pretty much the bible of current companies most Dividend Growth Investors are researching.
I'd start with the Champions tab and then sort by yield.
MO
T
CVX
CLX
KMB
MCD
PG
Those all yield over 3% and have paid an increasing dividend for 25+ years. If I was in your shoes I'd look at that spreadsheet, familiarize yourself with the companies and then pick something that gets you excited to own.
Good luck