3 Dividend Stocks Kid Gratitude
1.25%March 27 | MyPlanIQ portfolio symbol P_36985
As we explore the world of dividend bearing stocks, Austin Smith of the Motley Fool brings us back to the dividend aristocrats
on which you can build a long term portfolio. These are normally drawn
from a small list of blue chip companies. This list draws from this
list.
Austin quotes Warren Buffett: "The goal is to find companies that will be around for 20 years and offer a margin of safety."
Austin picked three companies with a combined 151-year history of not only paying but also raising dividends.
- 3M (MMM) is a $60 billion manufacturer of more than 50,000 products.
- Johnson & Johnson (JNJ) the maker of all-things-health and payer of a 3.5% dividend that's been raised for 49 years.
- Coca-Cola (KO) and its 3% dividend.
None of these companies need much introduction and I own 3M stock myself.
I have been looking at the
DRiP website where they keep track of dividend champions
for extra data and I extract a small piece of their data. Please note
that I have not double checked their numbers which were updated as of
the end of February 2012.
Company | Symbol | Industry | Yrs | Yield | Graham |
3M Company | MMM | Conglomerate | 54 | 2.69 | 60.8 |
Johnson & Johnson | JNJ | Drugs/Consumer Prod. | 49 | 3.50 | 60.5 |
Coca-Cola Company | KO | Beverages-Non-alcoholic | 50 | 2.92 | 103.7 |
The takeaways are:
These are dividend aristocrats with over 150 years of dividends
There is a value premium (as defined by the Graham number) which says that the stocks are anywhere from 60% to 100% over the Graham standard of fair market value
Even with these aristocrats, three equities is too few for a complete portfolio but it might
be the core of a larger portfolio. The companies are diversified and
is worthy on being measured against our benchmark ETF portfolio.