I wrote my first article on B&G Foods (BGS) for Seeking Alpha in the middle of 2011. At the time, it was trading at ~$18 and its $0.84 annual dividend yielding 4.7% was the main reason for recommending its purchase. The small ($0.5 billion in sales) packaged food company had several well-known brands (including Cream Of Wheat and Ortega) and the yield was far better than most of its much larger competitors. Seven years later the revenue has increased to ~$1.7 billion, the price is around $30 per share and the dividend has increased to $1.90 per share, driving the yield up to 6.3%. That dividend yield is still far better than its much larger competitors in the packaged food industry.
Most, probably all, of that growth has come from making accretive acquisitions of specific brands... more
By Cooper J. Howard
There's an old joke in the bond market: "What's the difference between a high-yield bond and a junk bond?" "It's high yield when you buy it, but junk when you sell it!" Since high-yield munis - those that are rated below Baa3/BBB-, or not rated at all - were one of the best-performing bond sectors in 2018, should investors consider them more "junk" or more "high yield" today?
High-yield munis were among the best-performing fixed income asset classes in 2018
Source: Bloomberg, total returns from 12/29/2017 to 12/31/2018. See disclosures for a list of indexes used. Past performance is no guarantee of future results.
We think the answer falls somewhere in the middle, but we are more cautious on... more
I have focused my articles and analyses mostly on large-cap dividend growth stocks. But my general theme has been to write about stocks with decent income and a growing dividend over time and with the potential for capital appreciation. In this article, I discuss Middlesex Water Company (MSEX), which is a little-known small-cap stock that has paid dividends since 1912. The company currently has a dividend yield of ~1.7%.
Middlesex Water has increased the dividend annually since 1973, making it a Dividend Champion. But despite the relative safety of water utilities and the long track record of paying and growing dividends, the dividend yield is near a 10-year low and below the broader market average, and furthermore, the company is overvalued based on the P/E ratio. Hence,... more
By Nate Parsh
Paychex, Inc. (PAYX), which is a member of the S&P 500 Index, is a leading provider of computerized payroll accounting, benefits and human resource services.
Paychex has a solid dividend yield of 3.3%, but in the past five years, the stock has significantly underperformed industry leader Automatic Data Processing (ADP). Today, Paychex stock has an attractive dividend but a high valuation. As a result, we expect mediocre overall returns for the stock over the next five years.
Recent Financial Results
Paychex primarily serves small and medium sized clients, while competitor ADP dominates the large business segment. Paychex currently has more than 600,000 clients. Though it has some overseas business, it operates primarily in the U.S. The company has a... more
Genuine Parts Company (GPC) has one of the highest dividend yields among the Dividend Aristocrats Index.
Because of this above-average yield, some investors have questioned the safety of the company's current dividend.
In this article, we assess Genuine Parts Company's current dividend safety by analyzing its earnings, free cash flow, recession performance, and debt (including an interest rate stress test). If you prefer learning through videos, you can watch a video analysis on the topic below:
Business Overview To begin, let’s talk about Genuine Parts Company’s business model. Genuine Parts Company is an automotive parts retailer. The company was founded in 1928 and since that time, it has grown into a sprawling conglomerate that sells automotive and... more
Public Storage (NYSE: PSA) announced today the tax treatment of the Company’s 2018 dividends. For the tax year ended December 31, 2018, distributions for the PSA common stock and all the various series of preferred stock were classified as follows:... more
Enterprise Products Partners L.P. (NYSE: EPD) (“Enterprise”) announced today that the board of directors of its general partner declared an increase in the quarterly cash distribution paid to limited partners with respect to the fourth quarter of 2018 to $0.435 per common unit, or $1.74 per unit on an annualized basis.... more
Note that due to reader requests, I've decided to break up my weekly portfolio updates into three parts: commentary, economic update, and the new "best stocks to buy right now" series. This is to avoid excessively long articles and maximize the utility to my readers.
This week's commentary explains a simple but proven strategy for growing your wealth no matter what the stock market is doing.
Due to family obligations, there is no economic update this week.
As I explained in my portfolio update 63, I'm now focused on paying down margin and thus won't be making changes to my real money portfolio for the foreseeable future. In fact, I've now realized the wisdom of Buffett's warning against using margin.
Omega Healthcare Investors, Inc. (NYSE: OHI) today announced that the Company’s Board of Directors declared a common stock dividend of $0.66 per share. The common stock dividend is payable Friday, February 15, 2019 to common stockholders of record as of the close of business on Thursday, January 31, 2019.... more
When it comes to yields, good things sometimes come in small packages.
Consider The Clorox Company (NYSE: CLX).
Over the two decades, the stock's yield has fluctuated between two and three percent. In other words, nowhere near high enough to get most income investors excited.
Yet over the period, Clorox’s dividend and stock price have both grown steadily. Since 1999, shares have delivered a total return, assuming reinvested dividends, of 371%.
That works out to 8.1% return on an annualized basis. By comparison, the S&P 500 posted an annualized total return of only 5.7% for the same period.
Of course, anyone can pick the best stocks with hindsight. But there’s good reason to believe Clorox will continue to post outsized returns.
I can’t... more