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GuruFocus Reports Weekly Top Dividend Growers

December 16, 2013 | About:
Monica Wolfe

Monica Wolfe

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During the past week, GuruFocus recognized five companies as dividend growers. In order to be qualified for this list, the company had to:

· Have a dividend yield of greater than 3%.

· Have a strong history of stable and increasing dividends.

· Maintain Guru ownership.

· Have a market cap of greater than $10 billion.

The following five companies come from various industries and sectors of the market, but they all fit the necessary criteria needed to qualify them as dividend growers.

A comparison of the companies’ historical dividend growth:

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Dow Chemical (DOW)

On Dec. 12, Dow Chemical declared a dividend of $0.32 per share, representing a 3.10% dividend yield for the company. This dividend is payable on Jan. 1 to shareholders of the record at the close of business on Dec. 31, 2013.

The company’s historical dividend growth is as follows:

· 10-year: -6.10%

· 5-year: -2.50%

· 3-year: 26.30%

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This is the 409th consecutive cash dividend issued by Dow Chemical. The company has paid its shareholders cash dividends consecutively since 1912.

Dow Chemical is engaged in the manufacture and sale of chemicals, plastic materials, agricultural products and services, advanced materials and other specialized products and services. It is also engaged in the property and casualty insurance and reinsurance business.

Dow Chemical’s historical revenue and earnings growth:

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The analysis on Dow Chemical reports that the company’s dividend yield is at around a 1-year low, its price is near a 5-year high and its revenue has been in decline over the past five years. The analysis also notes that the company’s Piotroski F-Score is high, representing a healthy situation, and that its operating margin is expanding.

The top guru shareholders of Dow Chemical:

1. Dodge & Cox: 28,997,741 shares, representing 2.4% of the company’s shares outstanding.

2. PRIMECAP: 1,714,000 shares, representing 0.14% of the company’s shares outstanding.

The company announced that it plans to retire its debt in the fourth quarter. It announced that it would be launching cash tender offers for up to $500 million aggregate principal amount of notes issued by Dow and its subsidiary.

The company’s third quarter results highlighted:

· Reported earnings of $0.49 per share, compared to $0.42 last year.

· Generated more than $1.4 billion in cash flow from operations and $5.6 billion year to date.

· Sales were up 1% to $13.7 billion.

· EBITDA was $1.8 billion.

The Peter Lynch Chart suggests that the company is currently overvalued:

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Dow Chemical has a market cap of $50.79 billion. Its shares are currently trading at around $41.88 with a P/E ratio of 19.00, a P/S ratio of 0.90 and a P/B ratio of 2.50. The dividend yield of Dow Chemical stocks is 3.10%. The company had an annual average earnings growth of 5.20% over the past five years.

Altria Group (MO)

On Dec. 11, Altria Group declared a dividend of $0.48 per share, representing a 4.90% dividend yield for the company. This dividend is payable on Jan. 10 to shareholders of the record at the close of business on Dec. 26, 2013.

The company’s historical dividend growth is as follows:

· 10-year: -8.70%

· 5-year: 2.10%

· 3-year: 8.80%

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Altria Group is a holding company whose wholly-owned subsidiaries include Philip Morris USA and John Middleton Co. The company’s reportable segments include smokeable products, smokeless products, wine and financial services.

Altria’s historical revenue and net income:

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The analysis on Altria reports that the company is currently trading near a 10-year high, the dividend yield is near a 10-year low and its operating margin is expanding.

The top guru shareholders of Altria:

1. James Barrow: 22,814,460 shares, representing 1.14% of the company’s shares outstanding.

2. Tom Russo: 7,708,331 shares, representing 0.38% of the company’s shares outstanding.

3. Jim Simons: 3,498,300 shares, representing 0.17% of the company’s shares outstanding.

The company’s third quarter results reported:

· Diluted EPS increased over 100% to $0.70.

· Adjusted diluted EPS increased 12.1% to $0.65.

· Authorized a $700 million expansion of their $300 million share repurchase plan.

The Peter Lynch Chart suggests that the company is currently undervalued:

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Altria has a market cap of $74.44 billion. Its shares are currently trading at around $37.22 with a P/E ratio of 14.50, a P/S ratio of 4.20 and a P/B ratio of 18.70. The company had an annual average earnings growth of 10% over the past five years.

Xcel Energy (XEL)

On Dec. 4.00%, Xcel Energy declared a dividend of $0.28 per share, representing a 4.00% dividend yield for the company. This dividend is payable on Jan. 20 to shareholders of the record at the close of business on Dec. 27, 2013.

The company’s historical dividend growth is as follows:

· 10-year: 3.70%

· 5-year: 3.20%

· 3-year: 3.20%

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Xcel Energy is a holding company, with subsidiaries engaged mainly in the utility business. The company's utility subsidiaries are engaged mainly in the generation, purchase, transmission, distribution and sale of electricity and in the purchase, transportation, distribution and sale of natural gas.

Xcel Energy’s historical revenue and net income:

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Xcel’s Top guru shareholders:

1. Brian Rogers: 5,765,200 shares, representing 1.16% of the company’s shares outstanding.

2. James Barrow: 2,382,420 shares, representing 0.48% of the company’s shares outstanding.

The analysis on Xcel reports that the company’s revenue has been in decline over the past five years, over the past three years the company has issued $2.1 billion of debt, on the other had the company’s operating margin has been in a constant state of expansion.

The company’s third quarter results highlighted:

· Ongoing EPS were $0.77, down from $0.78 last year.

· GAAP net income was $0.73, down from $0.81 last year.

· Updated long-term annual dividend and EPS growth rate objectives to 4% to 6%.

The Peter Lynch Chart suggests that the company is currently undervalued:

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Xcel Energy has a market cap of $13.95 billion. Its shares are currently trading at around $28.03 with a P/E ratio of 14.80, a P/S ratio of 1.30 and a P/B ratio of 1.50. The company had an annual average earnings growth of 3.50% over the past ten years.

Philip Morris International (PM)

On Dec. 11, Philip Morris International declared a dividend of $0.940 per share, representing a 4.10% dividend yield for the company. This dividend is payable on Jan. 10 to shareholders of the record at the close of business on Dec. 26, 2013.

The company’s historical dividend growth is as follows:

· 10-year: 0.00%

· 5-year: 18.70%

· 3-year: 13.10%

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Philip Morris’ subsidiaries and affiliates and their licensees are engaged in the manufacture and sale of cigarettes and other tobacco products in markets outside the U.S. Its portfolio comprises both international and local brands. Its portfolio of international and local brands is led by Marlboro.

Philip Morris’ historical revenue and net income:

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The analysis on Philip Morris reports that the company’s operating margin is expanding, over the past three years it has issued $9.2 billion of debt and its dividend yield is near a 3-year high.

The top guru owners of Philip Morris:

1. James Barrow: 21,562,204 shares, representing 1.33% of the company’s shares outstanding.

2. Jeremy Grantham: 16,210,217 shares, representing 1% of the company’s shares outstanding.

3. Tom Russo: 9,616,739 shares, representing 0.59% of the company’s shares outstanding.

The company recently announced that they would be acquiring a 20% interest in Russian Megapolis Group, which is PMI’s distributor in Russia. They will purchase this for $750 million.

The Peter Lynch Chart suggests that the company is currently overvalued:

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Philip Morris has a market cap of $136.57 billion. Its shares are currently trading at around $85.24 with a P/E ratio of 16.20 and P/S ratio of 1.76. The company had an annual average earnings growth of 14.50% over the past five years.

Ventas (VTR)

On Dec. 9, Ventas declared a dividend of $0.725 per share, representing a 4.90% dividend yield for the company. This dividend is payable on Dec. 31 to shareholders of the record at the close of business on Dec. 16, 2013.

The company’s historical dividend growth is as follows:

· 10-year: 9.10%

· 5-year: 5.10%

· 3-year: 6.60%

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This most recent dividend represents an 8% increase from last quarter’s cash distribution. The company’s 2013 per share dividend of $2.735 represents a 10.3% increase over its 2012 dividend.

Ventas Inc is a real estate investment trust with a portfolio of seniors housing and healthcare properties in the United States and Canada. The Company currently operates through three reportable business segments: triple-net leased properties, senior living operations and MOB operations.

Ventas’ historical revenue and net income:

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The analysis on Ventas reports that the company has issued $2.9 billion in debt over the past three years, its dividend yield is at a 3-year high and its P/B and P/S ratios are sitting at 2-year lows. The analysis also notes that the gross and operating margins have been in a long term decline.

The top guru shareholders of Ventas:

1. Chris Davis: 459,362 shares, representing 0.16% of the company’s shares outstanding.

2. Manning & Napier: 178,681 shares, representing 0.06% of the company’s shares outstanding.

3. Pioneer Investing: 119,518 shares, representing 0.04% of the company’s shares outstanding.

The company’s third quarter results highlight:

· Normalized FFO increased 8% to $307.2 million, up from $284.9 million.

· Diluted common share was a record $1.04, up from $0.96 per share last year.

· Net income was $118.3 million, or $0.40 per share, up from $111.9 million last year.

· Portfolio is now at 235 communities.

The Peter Lynch Chart suggests that the company is currently overvalued:

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Ventas has a market cap of $16.54 billion. Its shares are currently trading at around $56.25 with a P/E ratio of 38.50, a P/S ratio of 6.00 and a P/B ratio of 1.90. The company had an annual average earnings growth of 12.50% over the past ten years.

To view a complete list of high yielding dividend stocks found among the gurus’ portfolios, click here.

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Rating: 3.3/5 (4 votes)

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