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5 Dividend Stocks for US Portfolio

April 21, 2024
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Below I give a list of 5 dividend growth stocks for further consideration for your portfolio. Note, this is not a buy recommendation, but rather stocks I see as quite attractively priced at the moment.

All 5 stocks I believe have superior business models and should do well over the long term.

1. TTC (The Toro Company)

The Toro Company is an industrial company that was established in 1914. It is well known for its lawn mowers, landscaping equipment, snow throwers and many other products.

The company is a stable dividend growing company which also likes to buyback shares.

The company has a 29 year dividend streak with a current dividend yield of 1.37% and above the 5-year average dividend yield of 1.25%. The dividend has also been growing quickly with a 5-year dividend growth rate of 12% a year. 

Finally, the forward P/E of 18.9 is well below the 5-year average of 23.8 indicating that the stock might be undervalued at the moment.

2. V (VISA)

Visa is a well known payments company that operates in an oligopolistic environment with competitor Mastercard.

Although the dividend yield is quite low (0.71%), the dividend is growing very fast (19% 10-year annual growth rate). For example, the quarterly dividend was 10 cents in 2014 vs 37.5 cents in 2022. Another positive is the share count, it has reduced from 2.67 billion in 2012 to 2.12 billion in 2022 a reduction of more than 500 million shares!

The current dividend yield of 0.71% is above the 5-year average dividend yield of 0.63%. The stock is relatively cheap compared to its history with the forward P/E of 26.5 below the 5-year average of 29.3.

3. ICE (International Exchange)

Intercontinental Exchange is known for its ownership of the New York Stock Exchange (NYSE) and besides the revenue it makes from trading and clearing activities it also provides valuable data and analytical services.

It operates in a robust environment and has not had negative revenue growth in any of the last 10 years.

The company has a very fast growing dividend yield of 1.43%, the 5-year annual dividend growth rates clocks in at 14%. The current dividend is well above the average 5-year dividend yield of 1.21%.

The stock is relatively cheap compared to its history with the forward P/E of 22.1 below the 5-year average of 19.8.

4. LOW (Lowe's)

Lowe's also operates in an oligopolistic environment with other home improvement company Home Depot. Lowe's is the only Dividend King on the list i.e. companies that have paid dividends for more than 50 years!Another great attribute of Lowe's is its stock buyback program. Over the years the company has repurchased billions of dollars stock. 

The current dividend yield of 2.09% is above the 5-year average dividend yield of 1.79%. Incredibly, the 20-year annual dividend growth is 24%! Also, the stock is relatively cheap compared to its history with the forward P/E of 14.7 below the 5-year average of 17.9.

*I own this stock.

5. TSCO (Tractor Supply)

Tractor Supply is a rural lifestyle retailer catering to a richer rural clientele with a well-known loyalty program.

For a good write up check the following article. 

https://valuestockgeek.substack.com/p/tractor-supply-tsco

It is one of the best performing stocks over the last 20 years. Tractor Supply also have favourable attributes like a very growing dividend, relative undervaluation and a stock buyback program.

The current dividend yield of 1.91% is above the 5-year average dividend yield of 1.39%. In the last year, Tractor Supply increased it's by 77%! Also, the stock is relatively cheap compared to its history with the forward P/E of 19.3 below the 5-year average of 20.8.

*I own this stock.


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