Last week, we launched the Dividend Growth Index, a dividend stock index created by a few bloggers. On a quarterly basis, each blogger will follow their stocks and may also comment on the portfolio as a whole. Since we just launched the index, I won’t be discussing the results after this first week but will rather talk about my 3 picks: Intel (INTC), Coca-Cola (KO) and National Bank (TSE:NA). These 3 stocks together pays a 3.80% dividend yield and are known for their dividend growth over time. In fact, KO is even part of the prestigious Dividend Aristocrats List. But before this, an interesting twist just happened in the Dividend Growth Index; we have a new participant!
First things first, I want to welcome the one and only Dividend Growth Investor that will join our team of bloggers in the creation of this index. You can see his picks in the chart below (but more date will be available later on this week on his pick!).
Intel: INTC
There are 2 things that I really like about INTC: a P/E ratio at 10 and a dividend yield at 3.80%. While the stock has been sitting in the $20’s since 2004, the company never stopped increasing its dividend (from $0.08 per share per year to $0.84). That’s what I call dividend growth! Intel is the leader in its field and will remain in this position for several years. This is why I think its dividend growth and defensive stock qualities will help me cross the market turmoil.
Coca-Cola: KO
I’ve already written a full analysis of this stock (KO analysis) so I won’t be too long on this one. Let’s just say that it was my defensive (read chicken!) picks ;-). The real power of owning KO is definitely its incredible dividend growth. The company is still full of cash and it has the habit of doubling its dividend every 6-7 years (annual dividend growth rate of 6.5% on average). So while the dividend paid is not incredible right now (about 2.80%), it will grow quite fast over time.
National Bank: NA
If you are a US investor, I’m sure you don’t know National Bank. And if you don’t live in Quebec (the only francophone province of Canada), chances are that you don’t know too much about National Bank. To make it simple, we have 5 big banks in Canada and a smaller one that completes “the big 6). This smaller one is the National Bank. It used to operate almost exclusively in Quebec but, it has been expanding at an important pace for the past 10 years. We also see its desire to increase its presence across Canada and in the wealth management sector. Most recently, they bought Wellington West & the brokerage division of HSBC Canada. They have also invested massively in new SAP software to optimize their efficiency and provide a better customer experience. On the dividend side, NA shows up as a very strong pick. It combines both company growth along with dividend growth. After 2008, it was the first Canadian bank to increase their dividend. Again recently, they were voted the most solid financial institution of North America by Bloomberg. Let’s just say that I am pretty confident of this company ;-).
Dividend Growth Index
Below, you will find the chart showing some key financial ratios I follow along with each stock included in the Dividend Growth Index.
Participants:
* Due to the Financial Blogger Conference that happened this weekend, we are all a bit late in our posts. Therefore, I’ll update the links from all participant as their article goes live throughout the week and send it through my newsletter as well (make sure to subscribe!)
Blogger Stock #Shares Price Dvd Yield
My Own Advisor ABT US Equity 20 50.89 3.7
BNS CN Equity 19 51.75 3.87
CLC CN Equity 106 9.40 8.03
The Dividend Guy Blog INTC US Equity 47 21.18 3.78
KO US Equity 15 66.59 2.72
NA CN Equity 15 68.75 4.06
The Dividend Monk ETE US Equity 26 37.78 7.07
NVS US Equity 29 34.78 4.18
WMT US Equity 19 51.88 2.81
Dividend Ninja HSE CN Equity 45 22.20 5.15
PEP US Equity 16 61.59 3.29
SPLS US Equity 76 13.11 2.91
Passive Income Earner CNR CN Equity 15 68.83 1.83
CNQ CN Equity 33 30.10 1.14
AFL US Equity 29 34.50 3.34
Wealthy Canadian RY CN Equity 21 47.71 4.46
DAY CN Equity 193 5.18 11.43
BIN CN Equity 46 21.57 2.27
Dividend Mantra COP US Equity 16 62.71 4.1
PM US Equity 16 62.24 4.81
PG US Equity 16 63.69 3.3
DividendGrowth Investor CVX US Equity 11 91.93 3.31
MCD US Equity 11 87.43 3.16
EPD US Equity 25 40.00 5.98
and some dividend metrics I follow:
Blogger Stock Dvd 5 yr growth Dvd 1 yr growth Sales 5 yr avg P/E Payout Ratio
My Own Advisor ABT US Equity 10.05 9.52 11.96 11.84 59.05
BNS CN Equity 1.88 3.06 3.61 11.83 50.1
CLC CN Equity -2.96 -22.15 12.1 11.19 305.91
The Dividend Guy Blog INTC US Equity 13.95 19.17 11.49 10 30.56
KO US Equity 8.86 6.94 15.91 18.87 34.4
NA CN Equity 6.93 10.48 0.6 9.96 41.4
The Dividend Monk ETE US Equity 50.3 5.1 3.9 35.35 248.22
NVS US Equity 21.8 21.35 12.26 13.21 54.81
WMT US Equity 16.45 18.43 5.15 12.05 28.9
Dividend Ninja HSE CN Equity 1.3 0 28.83 11.32 86.96
PEP US Equity 12.18 6.99 14.88 14.86 47.92
SPLS US Equity 12.13 10.64 8.61 10.58 29.34
Passive Income Earner CNR CN Equity 15.24 17.18 3.05 16.02 23.91
CNQ CN Equity 19.34 24.32 8.56 26.05 19.21
AFL US Equity 19.14 7.14 6.82 6.01 22.82
Wealthy Canadian RY CN Equity 8.45 2 -1.41 11.81 57.26
DAY CN Equity -24.91 -25.93 33.13 N/A N/A
BIN CN Equity -21.88 -20 21.52 21.66 70.42
Dividend Mantra COP US Equity 12.73 20.48 16.35 9.16 27.95
PM US Equity N/A 13.03 #VALUE! 14.61 61.77
PG US Equity 11.28 9.22 3.57 16.13 46.82
DividendGrowth Investor CVX US Equity 9.11 7.14 13.03 8.34 29.81
MCD US Equity 29.5 10.91 5.44 17.9 48.68
EPD US Equity 6.12 5.32 28.69 22.61 195.52
*DAY is not profitable really so P/E and payout ratio make no sense
**PM only pays dividends since 2008
*** DGI picks data and everybody’s post will be available shortly.
Great update Mike! This will be fun!
Great stuff!
I’m just as excited to be a part of the group as I am to watch the progress and changes of the index over time.
Look forward to the updates!