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 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:
CA Inc (CA)
On May 15, CA Inc. declared a dividend of $0.250 per share, representing 3.93% dividend yield for the company. This dividend is payable on June 17 to shareholders of the record at the close of business on May 29, 2014.
The company’s historical dividend growth is as follows:
- 10-year: 22.90%
- 5-year: 58.10%
- 3-year: 84.20%
CA Inc. is provider of enterprise information technology (IT) software and solution. It develops and delivers software and services that help organizations manage and secure their IT infrastructures and deliver more flexible IT services.
CA’s historical revenue and net income:
The analysis on CA reports that the company’s operating margin is expanding, its revenue has slowed down over the past year, and its price is near a 10-year high. The analysis also notes that the company has issued $322 million of debt over the past three years, but that overall its debt level is acceptable.
The Peter Lynch Chart suggests that the company is currently undervalued:
CA has a market cap of $13.1 billion. Its shares are currently trading at around $29.25 with a P/E ratio of 12.80, a P/S ratio of 2.86 and a P/B ratio of 2.50. The company had an annual average earnings growth of 18.50% over the past ten years.
GuruFocus rated CA the business predictability rank of 5-star.
Lorillard (LO)
On May 15, Lorillard declared a dividend of $0.615 per share, representing 3.96% dividend yield for the company. This dividend is payable on June 10 to shareholders of the record at the close of business on May 29, 2014.
The company’s historical dividend growth is as follows:
- 10-year: 0.00%
- 5-year: 15.70%
- 3-year: 15.80%
Lorillard through its subsidiaries is engaged in the manufacture and sale of cigarettes. Its principal products are marketed under the brand names of Newport, Kent, True, Maverick and Old Gold with substantially all of its sales in the U.S.
Lorillard’s historical revenue and net income:
The analysis on Lorillard reports that the company’s operating and gross margins have been in a 5-year decline, its revenue has slowed down over the year and its price is at a 10-year high.
The Peter Lynch Chart suggests that the company is currently overvalued:
Lorillard has a market cap of $20.74 billion. Its shares are trading at around $57.21 per share with a P/E ratio of 18.90 and a P/S ratio of 3.03. The dividend yield of Lorillard stocks is at 3.96%. The company had an annual average earnings growth of 14.70%.
Ventas (VTR)
On May 15, Ventas declared a dividend of $0.725 per share, representing 4.14% dividend yield for the company. This dividend is payable on June 27 to shareholders of the record at the close of business on June 6, 2014.
The company’s historical dividend growth is as follows:
- 10-year: 8.00%
- 5-year: 7.50%
- 3-year: 8.50%
Ventas is a REIT with a portfolio of seniors’ housing and healthcare properties in the U.S. 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:
The analysis on Ventas reports that the company has issued $2.9 billion of debt over the past three years, its dividend yield is close to a 3-year high and its P/S and P/B ratios are trading at near historic lows.
The Peter Lynch Chart suggests that the company is currently overvalued:
Ventas has a market cap of $19.89 billion. Its shares are currently trading at around $67.57 with a P/E ratio of 43.20, a P/S ratio of 7.10 and a P/B ratio of 2.30. The company had an annual average earnings growth of 9.80% over the past ten years. GuruFocus rated Ventas the business predictability rank of 2.5-star.
Altria Group (MO)
On May 14, Altria Group declared a dividend of $0.480 per share, representing 4.68% dividend yield for the company. This dividend is payable on July 10 to shareholders of the record at the close of business on June 16, 2014.
The company’s historical dividend growth is as follows:
- 10-year: -8.20%
- 5-year: 8.50%
- 3-year: 8.00%
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:
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 Peter Lynch Chart suggests that the company is currently overvalued:
Altria has a market cap of $79.66 billion. Its shares are currently trading at around $40.10 with a P/E ratio of 18.30, a P/S ratio of 4.50 and a P/B ratio of 19.30. The company had an annual average earnings growth of 7.30% over the past five years.
Potash Corp of Saskatchewan (POT)
On May 14, Potash Corp of Saskatchewan declared a dividend of $0.350 per share, representing 3.79% dividend yield for the company. This dividend is payable on Aug. 1 to shareholders of the record at the close of business on July 11, 2014.
The company’s historical dividend growth is as follows:
- 10-year: 35.10%
- 5-year: 79.00%
- 3-year: 107.60%
Potash Corporation is an integrated fertilizer and related industrial and feed products company. The company owns and operates five potash mines in Saskatchewan and one in New Brunswick. Its phosphate operations include the manufacture and sale of solid and liquid phosphate fertilizers, phosphate feed and industrial acid, which is used in food products and industrial processes.
Potash Corporation’s historical revenue and net income:
The analysis on Potash reports that the company’s asset growth is currently faster than its revenue growth, its revenue has been in decline over the past year and its operating margin is expanding. The analysis also notes that the dividend yield is close to a 10-year high.
The Peter Lynch Chart suggests that the company is currently overvalued:
Potash Corporation of Saskatchewan has a market cap of $31.51 billion. Its shares are currently trading at around $37.25 with a P/E ratio of 20.70, a P/S ratio of 4.70 and a P/B ratio of 2.83. The company had an annual average earnings growth of 21.20% over the past ten years.
To view a complete list of high yielding dividend stocks found among the gurus’ portfolios, click here.
Try a free 7-day premium membership.
