Industrial conglomerates are often seen as relics from a forgotten age. These cobbled together groups of various businesses were once seen as the best way to produce long-term profits. The problem was that faster-growing businesses were often hampered by slow-moving and struggling ones. But for those conglomerates that have shed “boring” businesses to instead focus on future trends, the business model is one that provides plenty of profit growth.
And that includes our Best Dividend Stocks List pick in the sector.
Our industrial pick underwent a huge transformation a few years ago – shedding slow-growth enterprises. These days our pick operates in hot areas like aerospace engineering, smart-buildings and warehouse automation. All with a hefty dose of software and recurring revenues. This has made our pick a growth machine, even during the depths of the pandemic. A large focus on safety products, including respirators and safety masks, didn’t hurt either. All in all, our pick’s focus on growth industries has helped earn record revenues during 2020.
The best part is our pick’s path to continued growth.
With the economy opening up and business/consumer spending rising, several of our pick’s business lines are expected to see torrid growth in the new year. Even airline traffic and demand has already picked up. With high defense spending and a focus on green technologies, our industrial giant could be a great stock to own in the months ahead.
For investors, that should result in strong gains and more dividend increases.
To summarize, here are five reasons why you should own this stock:
1. Globally diversified manufacturer covering a wide range of high- and low-tech products across various sectors.
2. Pulled in over $30 billion in revenues during 2020, with almost no loss of sales during the pandemic.
3. Smartly used M&A and spin-offs since the Great Recession to boost profitability and grow revenues.
4. Raised dividend for more than 10 years.
5. Strong forward-looking payout ratio of 47% and yield of 1.80%.
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