Category Archives: Dividend Achievers

The new year brings new highs and it appears there’s little to slow this market down. The table below highlights the returns based on the top 5 companies under various fundamental metrics.

The S&P 500 did extremely well, given the backdrop of the pandemic, rising +17%. The DJIA on the other hand struggled to gain ground and ended the year virtually flat. The best strategy from last year’s list was to buy high P/B companies which are listed below.

U.S. Dividend Watch List: January 3, 2020

With the market rising week after week, there are few companies trading near their yearly low. Because of that, we’ve broaden the range from 10% of the low to 20%. Below is the first watch list for this year. Continue reading →

In reviewing last year’s list, we see that the best strategy was the high P/B category which returned +5.90%, although the market propelled higher by +14.90%.

The largest gain was driven by Clorox (CLX) which, at the time, was trading at a staggering 33x of its book value. Now compare that with American National Insurance (ANAT) which was trading at 0.55x book value. The stock fell -31%.

On average, 3 stocks trading below book value lost -20% of its value in one year. This is the observation we see and simply reporting on the data. The table is a summary table for various strategies.

Again, we continue to see the traditional value approach underperform.

U.S. Dividend Watch List: November 13, 2020

We saw another all-time high for the market this week. If the Dow Industrial and S&P 500 can consolidate and hold this level, it will be very bullish. This strong market is the reason why there are only 4 companies on our list. Continue reading →

Review last year’s list, we see that closest to the low was the best strategy which lost only 0.6%. The market, however, gained 6.6% since last year. Purchasing companies with low P/E or high dividend yield, a classic value approach, did not work out well.

Majority of the gained came from Clorox (CLX) gained 40.9% and CH Robinson (CHRW) gained 18.4%.

U.S. Dividend Watch List: October 9, 2020

The market pulled back from all-time high and consolidation period will be healthy for this up market to continue. The pull back pushed more companies closer to their yearly low.
Continue reading →

We begin with a look back at last year’s list. The S&P 500 rose 18.3% and the Industrial rose 7.9%. Purchasing the top 5 companies closest to the low would result in a loss of 60.1% while the best strategy was to purchase top 5 companies with highest P/B ratio. One theme is clear from our data, the typical value metrics didn’t work well.

Under the high P/B, 2 best performers were Eli Lilly (LLY) & Clorox (CLX). Hindsight is 20/20 but wouldn’t we all want to own Clorox knowing a pandemic was on the horizon?

U.S. Dividend Watch List: October 9, 2020

The market picked up a slight momentum going into October and we’re seeing a push toward the high. This movement pushed a lot of companies out of their yearly low range but we managed to gather a list for this week. Continue reading →

Take a look at the performance of last year’s list. The S&P 500 rose +11.40% and the Dow was up only +1.30%. The best performing strategy was high P/B which gained +30.50%. The largest drop in value, -63.2%, was the high yield. As we’ve documented before in great detail, chasing yield has not worked out well.

Under the high P/B strategy, we had LLY, CLX, ROL, MMM, and CHRW. Four companies outperformed the market with ROL rising +60.40% while MMM lost -2.60%. High yield companies were ARLP, OXY, PAA, XOM, and WEYS. Interestingly, the highest yield of 13.5%, ARLP, had the largest drop of -82%.

U.S. Dividend Watch List: September 25, 2020

The recent market pullback is starting to give us hope in our watch list. Our list expanded to 44 companies this week. Continue reading →

We begin by reviewing the performance of last year’s list. The table below highlight various fundamental strategies and their performance using the top 5 companies.

The best performing strategy was low yield while low P/E lost tremendous value in one year. Rollins (ROL) gained 57% in a year while Alliance Resource (ARLP) with P/E of 4.56 lost 80%.

U.S. Dividend Watch List: September 11, 2020

A substantial market correction occurred which increased the number of company trading near their yearly low. Below are companies that are current and former Dividend Achiever. Continue reading →

The market is now just a few percentage points away from the all-time high set in February 2020. This test is a critical one for the S&P 500. However, our team will monitor that, as well as, the Dow Theory indicators as a true test of the market sentiment. With the market near the high rather than the low, there are only a handful of companies on our watch list this week. Continue reading →

The 44% rally off the March low appears to be fading. If the market (S&P 500) can’t break through the 3,230 high set in June over the next few weeks, we estimate that 2,800 will be the next leg down. Fears of COVID first wave is a legitimate one and many states are easing restriction while new cases accelerate. Below are 20 companies on our watch list this week. Continue reading →

Prior Year Watch List Review (June 14, 2019)

The best performing strategy from last year was high P/B which fell 7% for the year. This was driven by a gain of 12.3% for Kellogg (K) and 11.5% gain for W.W. Grainger (GWW). However, that gain was offset by a loss of -46% from Nordstrom (JWN). Chasing high yield companies was detrimental with Alliance Resource Partners (ARLP), which at the time yield 12.30%, as it lost -76% in a year. Occidental Petroleum (OXY) with yield of 5.80% lost -62%.

U.S. Dividend Watch List Jun 12, 2020

This market swing from March low pushed many companies above 10% of the low and leaving us with only 5 companies on our dividend watch list despite broadening our criteria to include negative payout ratio. Continue reading →

Prior Year Watch List Review (May 24, 2019)

The best performing strategy from last year was high P/B which came in virtually flat for the year. This was driven by a rise of +40% for Jack Henry & Associates (JKHY). However, that gain was offset by a loss of -53% from Nordstrom (JWN). Chasing high yield companies was detrimental with Alliance Resource Partners (ARLP), which at the time yield 12.30%, as it lost -82% in a year. Occidental Petroleum (OXY) with yield of 5.80% lost -74%.

U.S. Dividend Watch List May 22, 2020

Since the low in March 2020, the market appears to be consolidating between 2,800 and 3,000. Interestingly, the Nasdaq is only 5.50% from the high and is in the black YTD. Obviously tech appears to be the winner during this interesting period and we are seeing some companies making new highs. Below are companies that are still trading near the low. Continue reading →

Prior Year Watch List Review (May 10, 2019)

The best performing strategy from last year was low yield. While the S&P 500 rose +1.70%, the Dow lost -6.20%. Companies with low yield such as Rollins (ROL) and Becton Dickinson (BDX) rose +16% and +13%, respectively.

Interestingly, the high yield strategy would have set you back -41% with the majority of the losses driven from Occidental Petroleum (OXY) and Gap (GPS) which lost -73% and -67%, respectively.

U.S. Dividend Watch List May 8, 2020

What a strange time we are living in. The unemployment rate skyrocketed to level no one had seen before.

Meanwhile, the market continued to crawl its way back, with the major indexes such as the S&P 500 hitting positive territory since last year. It’s difficult to determine if this rebound is for real but we continued to ask the question, is this situation more dire than the financial crisis where the market fell more than -50%?

Below are 10 companies on our watch list. Continue reading →

The bounce from the low was fast and furious and pushed many companies out of the 52 week low range. There are only a handful of companies this week but it’s worth revisiting companies on the April 3rd list as a good alternative.

Before we jump into this week’s list, let’s review the performance from last year. The best performing strategy was buying companies with low payout ratio. Two companies that came through was AmerisourceBergen (ABC) and Kroger (KR) both gaining more than 20%. Worse performing strategy was purchasing low P/E, a classic value investing strategy. Occidental Petroleum (OXY) and GAP (GPS) lost 78% and 68% respectively.

Disclaimer On our current list, we excluded companies that have no earnings. Stocks that appear on our watch lists are not recommendations to buy. Instead, they are the starting point for doing your research and determining the best company to buy. Ideally, a stock that is purchased from this list is done after a considerable decline in the price and extensive due diligence. Our view is to embrace the worse case scenario prior to investing. It is important to place these companies on your own watch list so that when the opportunity arises, you can purchase them with a greater margin of safety. It is our expectation that, at the most, only 1/3 of the companies that are part of our list will outperform the market over a one-year period.

Volatility continue to drive the market up and down as uncertainty continues to unfold both here and abroad.

Experts expect April to be the worse month and expect to see a peak in new coronavirus cases mid-April. At this moment, we think that market is looking for any reason to put up a good rally so any good news will likely drive the market higher.

It’s important to read how the market reacts to the up days. Our team continue to produce the dividend watch list and urge any income investors to utilize this list wisely but also apply caution as our team expects dividend cut to hit companies with high payout ratio (>75%). Continue reading →

Could things get any worse after a horrendous week? We certainly hope the curve for COVID-19 will flatten soon but only time can tell.

The S&P 500 has broken below the 2018 low at a record setting pace and has fallen -32% from the peak.

If you think that this situation is worse than the financial crisis then we probably have more room on the downside as the market fell more than -50% in 2008.

If you have the stomach to ride this out and want to pick the bottom, there are plenty of companies on our watch list this week. Continue reading →