Dividend.com has added a global food products producer to the Best Dividend Stocks List and removed a semiconductor manufacturer company from the list.
It’s no secret that the markets are getting back to normal. And with that, the smooth sailing of the previous few years has started to give way to more volatility. So, it’s only natural for investors to start thinking defensively with their portfolios. Consumer staples and their steady cash flows are back in vogue. But what if you can get a hefty dose of growth and defensive power from a consumer staples stock?
You’d have our latest Best Dividend Stocks List pick, of course.
Our pick is one of the leading packaged food and protein producers in the world, with a 126-year-old operating history. It’s behind a variety of iconic brands and has taken those brands international and into the higher-margined food service business. That’s allowed it to grow its earnings by 11% compounded annually over the last decade and increase its dividend for more than 50 years straight.
But our pick continues to grow even further.
That’s because it’s been quite successful at M&A, which has brought in a much broader portfolio of consumer foods into its umbrella, including a variety of ethnic, organic and natural brands. Consumers continue to favor foods in these categories and our pick is quickly becoming a powerhouse in the sector. This has continued to drive revenues and, more importantly, profits higher.
At the end of the day, the story for our new consumer foods pick is a positive one. The combination of steady-eddy cash flows as well as plenty of growth makes it an ideal play for your dividend portfolio.
To summarize, here are five reasons why you should own this stock:
- Recorded more than $9 billion in net sales last year with key organic/natural categories showing double-digit growth.
- Achieved an earnings growth milestone that only seven other firms in the S&P 500 can match.
- One of the highest margins and return of investment rates in the sector. M&A superstar.
- Dividend Aristocrat with 50+ years’ straight worth of dividend increases.
- Healthy payout ratio of 42% and increasing yield of 2.07%.
Removal of a Semiconductor Manufacturer from the Best Dividend Stocks List
As the classic Kenny Rogers song goes, “You got to know when to fold ‘em.” And that means it’s time to step away from a recent pick in the semiconductor sector. The high volatility of the recent weeks has caused many investors to flee tech-related stocks and their relatively high valuations. This includes our pick in the semiconductor sector. Investors have sold shares hard and momentum has fled the stock.
With the firm’s relative strength score now dipping below thresholds and its overall DARS score slipping, we’ve been forced to remove the stock from our coveted list. However, the firm’s continued leadership position – and the cash flows, profits and dividends that it brings – is still well intact. Unfortunately, our rules-based model means it must be removed from our sought-after list.
Find out here which traditional retailer with Amazon-proof business model entered the Best Dividend Stocks List last week.
