The retailing industry has been the first to endure the negative effect of an unstable macroeconomic environment that forces many retailers out of business. On the other hand, the U.S. Census Bureau reports that the total sales for the first quarter of 2016 (January through March) were up 2.8% YoY. For the coming year, retailers with optimized distribution systems and enhanced supply chains are expected to stay ahead of the competition as consumers expect greater products and faster delivery when shopping online.
This article discusses two retailers that trade on the NYSE. Their average debt-to-equity ratio is 0.03 while their average beta is 0.64. Both metrics suggest financially healthy companies with effective debt management. Both deliver strong cash flows and dividends, with an... Read more
Generally, Utilities have much higher dividend payout ratios than their blue-chip peers because they have less room for expansion. Therefore, they pay a higher percentage of their retained earnings to their shareholders in the form of cash dividends. Although a payout ratio between 75% - 95% is not considered healthy, utilities tend to have payout ratios in this range as well as high debt-to-equity ratios.
The reason why Utilities maintain such high payout ratio returning value to their shareholders is because they act as a monopolistic authority in their given regions or municipalities, thereby facing a low elasticity of demand. The general notion is that strong competition in Utilities is inefficient.
This article discusses three utilities companies that trade on the NYSE. The... Read more
Conglomerates have diversified interests in different industries by owning a controlling stake in smaller companies, which they conduct business separately. Typically, companies that are structured as conglomerates have exposure in different sectors and thereby, their dividend yield may fluctuate, but it is steadily above the average dividend yield of the market. Moreover, due to their diversified interests, conglomerates can offset losses in one industry with gains in another, thereby diversifying risk and achieving strong financial results.
This article discusses three mid-cap and large-cap conglomerates. All three stocks trade slightly lower than their 52wk high while two of them have outperformed the market and the NYSE Composite Index. Moreover, their average dividend yield is... Read more
The Diversified Food industry includes large caps like Kraft Heinz (Nasdaq: KHC) and Mondelez International (Nasdaq: MDLZ), but it also includes mid caps that outperform the index and deliver shareholder value. The industry includes companies that engage in the manufacturing and marketing of a range of different packaged food products, including snacks, dairy products, packaged dinners, and processed meats, among others.
This article discusses three stocks that trade in the diversified food industry. Their average debt-to-equity ratio is 0.23 and their average beta is 0.56, both indicating safe stocks with successful debt management. The average dividend yield of all three companies is close to 2%, whereas their payout ratio is 28.1%. What is impressive though is that the only mid... Read more
The Consumer Goods sector includes companies that engage in the manufacture and sale of items that serve a range of industries, including automobiles, beverages, clothing, electronics, food production, and packaged goods. As the sector is heavily correlated to consumer behavior, the stock performance may be subject to consumer demand. For instance, when the economy is growing, the sector experiences a higher demand for high-end products while when the economy is shrinking, there is a growing demand for value products.
This article discusses three mid-cap stocks that trade in the Consumer Goods Industry. All three stocks have significantly outperformed both S&P 500 (+0.18%) and NYSE (-6.80%) YoY and trade at an average beta of 0.89. Their average dividend yield is 2.38%, higher... Read more
Utility companies are popular among investors, because they consistently deliver dividends. This is due to the government restrictions placed on energy markets that provide utility companies with a monopolistic authority and thereby, with a low elasticity of demand. Moreover, utility companies offer water, power, heat and telecommunications even during uncertain financial times and therefore, their revenue streams are extremely consistent. This allows them to deliver steady dividends to their shareholders.
This article discusses three small caps utilities companies with an average dividend yield close to 3% and an average payout ratio of 62.7%. All three companies are consistently delivering cash dividends, even during a recession, whereas their average beta is 0.38. These low-risk... Read more
Insurance companies typically pay some of the highest dividends, thus offering an interesting option to investors seeking long-term, steady income. In fact, for income investors, sectors like the financial services and insurance industries are typical additions to portfolios seeking fixed income through dividends. The most common metric used by analysts to compare insurance companies is the dividend yield and as with any other sector, a higher dividend yield implies a stronger dividend investing potential.
This article discusses three mid-cap companies trading in the Insurance industry. The average dividend yield of the three companies is 2.32%, so it’s in line with the industry average of 2.25%, whereas their average payout ratio is 42.5%. All three companies have a low... Read more
Not all stock sectors are equally striking when it comes to dividend income. There are sectors that are characterized by short product cycles and cyclical business trends and therefore have less predictable cash flows. This makes them an unsafe bet for dividend investors. On the other hand, sectors with companies that consistently raise their dividend for a period of at least 10 consecutive years, present a clear competitive advantage and favorable industry dynamics.
The services sector comprises of a range of different businesses, which provide necessary services that companies choose to outsource. As long as the services provided are high quality and cost-effective, there is little reason to change vendors.
This article discusses three companies that trade in the Services... Read more
By including mid-cap companies in your dividend growth portfolio, you actually add value and diversity and you are given the opportunity to realize strong returns over the long-term. Normally, mid-cap companies, which are companies with a market capitalization between $2 and $10 billion, can deliver stronger returns than large or small-cap stocks. This happens because large-caps are already strong and they cannot grow as much as mid- or small-caps. At the same time, mid-caps have already established a growth strategy and they effectively implement it based on the economic cycle.
This article discusses three mid-cap companies that trade in the Diversified Utilities industry. All three stocks have a market value less than $5 billion and an average debt-to-equity ratio of 0.92,... Read more
The strength of dividend investing is that investors can build a portfolio of high quality dividend stocks over the long-term and rely on this steady income. The longer a company pays a dividend, the more a portfolio continues to grow regardless of how depressive or fluctuating the stock market is. Dividend investing is not a get-rich-quick scheme, but it rather guarantees safer investments in dividend-paying stocks in the long run.
This article discusses three companies, one mid-cap and two large-caps, that trade in different industries, namely the Industrial Equipment industry, and the Waste Management industry. The two companies in the Industrial Equipment industry are affected by the tough business conditions, yet they have managed to deliver strong operating results as well... Read more