A Dividend King is a company that has increased its dividend for at least 50 consecutive years. At first sight, the whole list feels pretty safe. But the past is never a guarantee for the future… Some Kings are even in trouble! Let’s look deeper into VFC, SWK, TGT, MMM, MO, and LOW.
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- VF Corporation (VFC) is a fairly new Dividend King. Its iconic brands led the company to great past success. However, inflation, shipping costs, lockdowns in China, and mass-market retail might have a huge impact on its future.
- Stanley Black & Decker (SWK) has paid dividends for over 140 years. Still, we can notice a big slowdown in 2022 and margins that are getting tighter. Is it still a company to hold?
- Target (TGT) does not need any presentation. It didn’t prevent it from going down double-digit on its earnings day! Will high competition make it irrelevant for investors?
- 3M (MMM) has been a source of concern for a while and its business model seems more diversified than a balanced mutual fund! However, the numerous lawsuits drop a big shadow on this king that may kill its cash flow.
- Altria Group (MO) shows a business model that belongs to the past. It remains hard for the company to find growth perspectives. Will price increases be enough?
- Lowe’s (LOW) operates over 1,700 stores located across 50 states in the United States, as well as over 234 stores in Canada. Is it in good health now that the pandemic hype has dried out and that recession is on the way?
- Are there any potential replacements in the same sector that seem to be doing better than these Dividend Kings?
Dividend cuts are terrible and frustrating. With all the uncertainties around the market, dividend safety is more important than ever. However, avoiding dividend cuts is much more than receiving a constant quarterly payment.
As dividend growth investors, we all like dividend increases. Wouldn’t it be perfect to have a list of the most amazing dividend growers and just pick some from the basket? Those lists exist, but today we’ll discuss their pros and cons and share our safe list!
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