7 New Dividend Growth Stocks

Dividend Geek • January 13, 2015 • 1 Comment

I just completed my annual search for high quality companies that qualify for the Dividend Geek Best Dividend Growth Stocks List. I was able to find seven new stocks that met our rigorous selection criteria:

10 or more years of consecutive dividend increases (in some cases we will consider exceptional companies that have achieved 7+ years)
Must have a competitive advantage or economic moat (this requirement disqualifies a lot of companies)
Minimum 2% dividend yield (will vary with price cycles)
Minimum 8% dividend growth rate (we use the average of the 1, 3, 5 and 10 year averages)
Stable dividend payout ratio trend (Note: Utilities, MLP’s, and REIT’s will have high payout ratios, due to their business structure)

Here are the new stocks that have been added:

Company	Ticker	Sector	Years Dividend Raises	Competitive Advantages	Dividend Yield	Dividend Growth Rate	Payout Ratio
Nestle S.A.	NSRGY	Consumer Staples	14	Strong	3.34%	11.7%	79%
Phillip Morris	PM	Consumer Staples	7	Strong	4.81%	12.1%	80%
Williams Company	WMB	Energy	11	Strong	5.57%	36.2%	89%
BHP Billiton	BBL	Materials	12	Medium	6.07%	9.9%	48%
CenterPoint Energy	CNP	Utilities	9	Medium	4.20%	8.6%	75%
Gap	GPS	Retail	10	Medium	2.12%	27.1%	31%
Accenture	ACN	Technology	10	Strong	2.27%	17.8%	46%

I really like each of these companies and feel they would make a high quality position to any dividend growth portfolio for long-term stability and income growth at the right entry price.

Two of these companies Nestle, and BHP Billiton pay dividend distributions semi-annually instead of quarterly. In the past I have disqualified companies that paid dividends semi-annually due to the slower compounding rate, but I believe that of the strength and international diversification that they provide outweigh the fewer payments per year.

That said, I recently purchased BHP Billiton (BBL) at $41.91 which you can see on the Dividend Geek portfolio page. I like all of these great companies and a few like BBL are on sale right now. BBL is getting beat up right now over the 5-year low in oil prices and slower growth in China, but oil is just one of many different raw materials that they mine. In fact, BHP Billiton is diversified supplier of aluminum, coal, copper, iron ore, mineral sands, oil, gas, nickel, diamonds, uranium, and silver.

Filed in: Dividend Geek Portfolio • Dividend Growth Investing