Dividends are like the third rail for public companies. Most board members and executives would much rather do something drastic like borrow money instead of reducing their dividend payments to shareholders. So, there is something to be said for dividend aristocrats who continue raise their dividends year in and year out.
What Are Dividend Aristocrats?
A dividend aristocrat is a company that has consecutively raised its dividend every year for at least 25 years. The 25 year mark is of increasing dividends every year at least once if not more times within a year is hard to do. Twenty-five years shows consistent growth through all types of bull and bear markets, dips, downturns, and even recessions. Dividend aristocrats have shown investors that they are consistent and growing winners in the stock market that can be trusted.
Dividend aristocrats are often blue chip stocks. These stocks have paid a consistent dividend with solid returns for many years. Many of these stocks have increased their dividends substantially over time, and some of them have even increased their dividends quarterly.
Dividend aristocrats not only pay their dividend, but these are also high growth stocks that have consistently put up good numbers. Imagine realizing a consistent return from growth, even a split, and then turning around to receive a dividend as well.
I have been an investor in Dr. Pepper Snapple Group (NYSE: DPS) ever since it spun off from its former parent company Cadbury Schweppes in 2008. It is an excellent company with a good dividend that, not only continues to increase its dividend, but is poised to see a run in its share price as well. It is a good dividend stock that should be added to your watch list.
Here are a few reasons why I like Dr. Pepper Snapple Group shares.
Dr. Pepper Offers A Good Dividend Yield
With returns on Treasuries, money markets, and certificates of deposit still at some of the lowest levels seen in a generation, investors continue to be on the hunt for yield. At current share price levels, Dr. Pepper Snapple Group’s current annual dividend of $1.52 per share provides a dividend yield of 3.33%. Stocks like Dr. Pepper that offer over a 3% annual dividend yield provide investors with a high yield that dividend investors are looking for.
Dr. Pepper Continues To Increase Its Dividend
Dr. Pepper Snapple Group spun off and became a publically traded company in 2008. In 2009, the company started issuing a dividend, and that dividend has increased every year since 2009. The dividend has more than doubling in 4 years, which equates to over an 18% increase to the dividend annually.
Potential Reasons For Dr. Pepper’s Share Increasing
DPS Has A Low P/E Ratio
Dr. Pepper Snapple Group has a Price to Earnings (P/E) Ratio of just 15.2 with its current share price of $45.64. This P/E Ratio is well below its industry rivals Coca-Cola (NYSE: KO) and Pepsi Co. (NYSE: PEP). Currently, both Coke and Pepsi enjoy a P/E Ratio of 21.
One of the key things that you will need to do if you want to run a successful business is to advertise. If you are concerned about the environment, then you will be happy to know that there are several ways that you can advertise without harming the environment. Below are some of the green ways to advertise and promote your business.
Social Media Marketing
The Internet has become one of the most popular tools for advertisement. Social media marketing will not only help your business be greener, but it will also help save your business money. Websites like Twitter and Facebook make it very easy to promote your business. Social media sites also help you stay in touch with your current customers. You should also set up your own personal blog or website. You may want to contact a SEO specialist so that you can find out ways to drive more traffic to your blog or website.
Promotional Grocery Tote Bags
One way that you can get your brand out there is by using promotional grocery tote bags. They are a great alternative to plastic grocery bags. Customers love to have products with a business’s name on it.
Use Recycled Paper For Advertisements
Despite the fact that more and more businesses are using social media to advertise, paper advertisement still remains popular. Fliers and business cards are two of the materials that you can use to promote the business in your area. However, you should consider using recycled paper for your advertisements. This will help save trees. Using recycled material will also help your business save money.
It’s a tough time in today’s economy as a business, no matter how big or small you are. No sooner does a new business get off the starting blocks, are they then faced with crunching numbers that leave heads in a spin. It’s essential, in this day and age, to pay attention to the current climate while also adhering to constantly-changing government regulations, ensuring that energy efficiency and being green are at the top of your agenda. This will improve your business reputation and the look of your balance sheets.
While reducing your carbon emissions and improving your energy efficiency may seem like hard work, in reality, there are plenty of ways in which you can do your bit for the environment without even thinking about it. It’s certainly not an arduous task to turn electricity off and to carpool – it’s simply a matter of educating and encouraging yourself and employees.
There are plenty of ways in which to improve business and commercial energy efficiency, and with inspiration from these six superstars you can implement some positive changes in your business too. Not only will you see an improvement in your quarterly expenses, but the environment will also benefit and you and your staff will feel more positive about your impact upon the planet.
With the help of the Carbon Trust and a little initiative, these six national and international giants have changed the way they think about energy. Here’s how.
A recent reader questioned the validity of a dividend aristocrat as a growth stock. His argument was whether or not you could find a growth stock among those dividend aristocrats. He asked, why invest in a dividend aristocrat because after 25 years of consistently rising dividends, how much growth could there be left in the shares?
The question, like most, begs for a little further examination. It made me dig into some questions? When does a growth stock become a value play? Can a dividend aristocrat be a growth stock? Or, is it a value stock by its very nature? And, what role does the dividend payout ratio play in our determinations?
Understanding Growth Stocks vs Value Stocks
Investopedia defines a growth stock as a stock whose share price grows at a faster rate than the overall stock market. Last year, of course, the S&P 500 Index saw a 13% gain, and it is set to make a comparable run here in 20113 as well.
Conversely, a value stock is the ying to growth stocks’ yang. Value stocks are often undervalued when compared to the company’s financial metrics. Investors often find that value stocks have a higher dividend yield, lower price to book ratio, and often a lower price to earnings (PE) ratio than growth stocks traditionally.
Can A Dividend Aristocrat Be A Growth Stock Too?
Yes, a dividend aristocrat can be a growth stock also, but it may be unlikely. They are more likely to be a value stock and a blue chip company. Out of the 59 dividend aristocrats in the S&P 500 index, many have seen year over year share price growth of over 13% in recent years. While we may not consider strong dividend payers as high growth companies, the possibility is still out there for those companies to provide both income and capital appreciation to shareholders.
It is a common mis-conception that life insurance is only for people who are edging on the mature side of life, when in fact; it is never too early to opt to pay into a life insurance policy.
OK, so it may be a morbid thought when you are in your twenties and living the high life, but anything could happen at any time. Sensible people will understand that it is a good move to make sure you are covered should the worst ever happen, and then be as crazy as you want knowing all the precautions have been taken. Visit the HBF life insurance portal to find out if you’re eligible for cover today.
Before any other factors come into consideration, remember that funerals are very expensive affairs. Could your family afford it should they ever need to? Probably not, mainly because not many people out there have an emergency funeral fund, so a policy is worth it just to cover this aspect.
When they hit adulthood, most people start making decisions that impact on them financially and in turn, if anything happened to them, would impact on their families. If you have chosen to go to university, it’s fairly certain that you will have a rack of student debt that is eye wateringly large.
Most think that when they go, any debt they accrue goes with them, but that’s not true. Any debt left in your name will be passed on to your family, in the same way as any assets would. Even when you’re in your twenties, it is extremely wise to at least opt for a policy that will cover any debts you have built up should anything ever happen to you.