While dividends won’t make an investor rich overnight, reinvesting dividends can help get you there over the course of time, and it can add some stability too. We screened a universe of reputable dividend stocks dubbed “dividend champions” (see below for details) for those with the bullish backing of top analyst firms including Barclays (BCS), UBS (UBS) and Deutsche Bank (DB).
There were very few matches, and even fewer overlaps in “buy” or “overweight” ratings. The results of our screen are below
More information on Dividend Champions:
While dividends are never guaranteed, it helps to look for companies with a record of consistent payment and yield increases. If a company has a long-standing policy of increasing payments to shareholders, it bodes well for the future.
Thankfully, the DRiP Investing Resource Center makes the task of finding qualifying stocks quite simple: Every year they compile a list of so-called “Dividend Champions” – a list of companies that have consistently increased their dividend payouts for over 25 years straight.
The Weight of “Buy” and “Overweight” Ratings:
Most investment banks have large teams of analysts that are each assigned to a specific sector or company, so they theoretically know everything there is to know about it. And although they’re certainly not always correct, analysts put a lot of time and analysis into their ratings. So we can assume they have good reason for rating a company “buy” or “overweight” – the highest bull rating available (versus “equal weight” or “underweight”).
Business Section: Investing Ideas
Here’s a list, starting with the 4 names rated “Overwight” by Barclays Capital.
1. The Chubb Corporation (CB, Earnings, Analysts, Financials): Provides property and casualty insurance to businesses and individuals. Market cap at $19.19B, most recent closing price at $72.18. On 08/09/2011, Barclays Capital had a Overweight rating on the stock. The stock has been raising dividends for 47 years to a current yield of 2.25%.
2. W.W. Grainger, Inc. (GWW, Earnings, Analysts, Financials): Distribute facilities maintenance and other related products and services in the United States, Canada, Japan, Mexico, India, Puerto Rico, China, Colombia, and Panama. Market cap at $14.1B, most recent closing price at $202.39. On 10/14/2011, Barclays Capital had a Overweight rating on the stock. The stock has been raising dividends for 41 years to a current yield of 1.56%.
3. Johnson & Johnson (JNJ, Earnings, Analysts, Financials): Engages in the research and development, manufacture, and sale of various products in the health care field worldwide. Market cap at $188.44B, most recent closing price at $68.35. On 12/09/2011, Barclays Capital had a Overweight rating on the stock. The stock has been raising dividends for 50 years to a current yield of 3.52%.
4. Stanley Black & Decker, Inc. (SWK, Earnings, Analysts, Financials): Provides hand tools, mechanical access solutions, and electronic security solutions. Market cap at $11.27B, most recent closing price at $67.01. On 10/13/2011, Barclays Capital had a Overweight rating on the stock. The stock has been raising dividends for 45 years to a current yield of 2.93%.
We also checked Deutsche Bank’s “Buy” ratings against the DRiP list of dividend champions. There was no overlap, and only 2 names came through our screen. They are:
1. Chevron Corporation (CVX, Earnings, Analysts, Financials): Engages in petroleum, chemicals, mining, power generation, and energy operations worldwide. Market cap at $220.88B, most recent closing price at $112.57. On 02/29/2012, Deutsche Bank had a Buy rating on the stock. The stock has been raising dividends for 25 years to a current yield of 3.28%.
2. Altria Group Inc. (MO, Earnings, Analysts, Financials): Engages in the manufacture and sale of cigarettes, smokeless products, and wine in the United States and internationally. Market cap at $71.41B, most recent closing price at $35.13. On 12/06/2011, Deutsche Bank had a Buy rating on the stock. The stock has been raising dividends for 43 years to a current yield of 4.55%.
Lastly, we ran out screen with “Buy” ratings from UBS. 3 names made the list. W.W. Grainger Inc. made the list, overlapping with the “Overweight” rating from Barclays.
1. Automatic Data Processing, Inc. (ADP, Earnings, Analysts, Financials): Provides technology-based outsourcing solutions to employers, and vehicle retailers and manufacturers worldwide. Market cap at $28.29B, most recent closing price at $57.84. On 03/01/2012, UBS had a Buy rating on the stock. The stock has been raising dividends for 37 years to a current yield of 2.79%.
2. W.W. Grainger, Inc. (GWW, Earnings, Analysts, Financials): On 06/08/2012, UBS had a Buy rating on the stock.
3. Target Corp. (TGT, Earnings, Analysts, Financials): Operates general merchandise stores in the United States. Market cap at $42.65B, most recent closing price at $64.50. On 12/07/2011, UBS had a Buy rating on the stock. The stock has been raising dividends for 45 years to a current yield of 2.37%.
Written by Rebecca Lipman. Dividend data sourced from the DRiP Investing Resource Center. Analyst ratings data sourced from Reuters. All other data sourced from Finviz.
Use Kapitall’s Tools: Looking for ways to analyze this list?
Use this article snapshot as a launch pad (click here for help): Simply click on the links, and use Kapitall’s tab navigation to browse through the data…
Analyze These Ideas: Getting Started
- Read descriptions for all companies mentioned
- Access a performance overview for all stocks in the list
- Compare analyst ratings for the companies mentioned
- Compare analyst ratings to annual returns for stocks mentioned
- Real-Time Opinion: Scan the latest tweets about these companies (feed will open in a new window)
Dig Deeper: Access Company Snapshots, Charts, Filings
- The Chubb Corporation (CB, Chart, Download SEC Filings)
- W.W. Grainger, Inc. (GWW, Chart, Download SEC Filings)
- Johnson & Johnson (JNJ, Chart, Download SEC Filings)
- Stanley Black & Decker, Inc. (SWK, Chart, Download SEC Filings)
- Chevron Corporation (CVX, Chart, Download SEC Filings)
- Altria Group Inc. (MO, Chart, Download SEC Filings)
- Automatic Data Processing, Inc. (ADP, Chart, Download SEC Filings)
- W.W. Grainger, Inc. (GWW, Chart, Download SEC Filings)
- Target Corp. (TGT, Chart, Download SEC Filings)
New to Kapitall?
1. New to the site? Click here to register for a free account, and gain access to more tools and data
2. Looking for more investing ideas like this? Click here to sign up for your free copy of Kapitall Weekly
3. Follow us on SeekingAlpha, Motley Fool, Nasdaq and Twitter
ABOUT KAPITALL WIRE
Kapitall Wire, which is not a broker/dealer, offers free cutting edge investing ideas, lively commentary and timely analysis of companies enhanced by interactive tools. And the Investing 101 section breaks complex concepts down to their basics, offering education to novices that doubles as a refresher course for more seasoned investors.
Kapitall Wire is a division of Kapitall Inc. Securities products and services are offered by Kapitall Generation, LLC, member FINRA/SIPC . Kapitall Generation, LLC is a wholly owned subsidiary of Kapitall, Inc.
