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Dividends4Life (38.62)

10 Dividend Stocks Delivering The Secret To Success

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January 22, 2014 – Comments (1) | RELATED TICKERS: MCD , ADP , WMT

We all want to learn the secret to success. Many get-rich-now infomercials have preyed on this desire while making the sellers wealthy at the expense of the buyers. I have good news for you, there really is a secret to success, and what is even better news is that the secret is not hard to discover. It has been right there in front of you all this time. Your parents likely taught it to you in the form of a fable. Let's explore this secret to success a little more...

As a child most of heard (or watched) Aesop's fable The Tortoise and the Hare. The story is about confident hare that brags about how fast he can run while poking fun at a slow-moving tortoise. The tortoise having tired of the hare's fodder challenges him to a race. The hare jumps out to an early lead and decides to take a nap midway through the race. When he awakes, he finds that the tortoise made steady progress and beat him to the finish line.

Have you ever stopped to ponder just where are all these get-rich-now infomercial millionaires? I know several people who have purchased one or more of these get-rich-now kits, but I don't know of anyone who actually got rich from purchasing the kit. Warren Buffett and Bill Gates didn't build their fortunes with a get-rich-now kit. They worked hard built it steadily over time.

In much the same way, a disciplined approach to investing, such as dividend growth stocks, can be highly effective. Though it may seem boring to many, I find it exciting to see my income growing as the finish line approaches. Consider these slow and steady growers with 35 years or more of consecutive dividend growth:

McDonald's Corporation (MCD) is the largest fast-food restaurant company in the world, with nearly 35,000 restaurants in 119 countries.
Yield: 3.4% | Div. Growth: 8.71% | Years: 37

Automatic Data Processing Inc. (ADP), one of the world's largest independent computing services companies, provides a broad range of data processing services.
Yield: 2.4% | Div. Growth: 7.28% | Years: 37

Wal-Mart Stores, Inc. (WMT) is the largest retailer in the world, Wal-Mart operates a chain of over 10,000 discount department stores, wholesale clubs, supermarkets and supercenters.
Yield: 2.4% | Div. Growth: 13.48% | Years: 39

Kimberly Clark Corp. (KMB) is a global consumer products company's producing tissue, personal care and health care products. Its brands include Huggies, Pull-Ups, Kotex, Depend, Kleenex and Scott.
Yield: 3.0% | Div. Growth: 7.07% | Years: 41

PepsiCo, Inc. (PEP) is a major international producer of branded beverage and snack food products.
Yield: 2.7% | Div. Growth: 5.17% | Years: 41

Target Corp. (TGT) operates nearly 1,800 Target, SuperTarget and CityTarget general merchandise stores across the U.S. and about 125 stores in Canada.
Yield: 2.7% | Div. Growth: 19.70% | Years: 46

The Coca-Cola Company (KO) is the world's largest soft drink company, KO also has a sizable fruit juice business.
Yield: 2.8% | Div. Growth: 8.02% | Years: 51

Johnson & Johnson (JNJ) is a leader in the pharmaceutical, medical device and consumer products industries.
Yield: 2.8% | Div. Growth: 7.29% | Years: 51

The Procter & Gamble Company (PG) is a leading consumer products company markets household and personal care products in more than 180 countries.
Yield: 2.8% | Div. Growth: 5.18% | Years: 56

Genuine Parts Co. (GPC) is a leading wholesale distributor of automotive replacement parts, industrial parts and supplies, and office products.
Yield: 2.6% | Div. Growth: 6.15% | Years: 57

There are really no shortcuts to long-term wealth. Many of those that win the lottery end up losing the money through mismanagement (or worse.) Dividend Growth Stocks may be slow, but they are also steady; and slow and steady wins the race.

Full Disclosure: Long MCD, ADP, WMT, KMB, PEP, TGT, KO, JNJ, PG, GPC in my Dividend Growth Portfolio. See a list of all my dividend growth holdings here.

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1 Comments – Post Your Own

#1) On January 22, 2014 at 10:00 PM, Lordrobot (88.58) wrote:

OK... at the turn of the century there were 500 car manufacturing companies. By 2011 only one had survived. How would you find that one stock out of 500? That's easy, look back in time after it has succeeded or failed and report your results. Useless however for an investor.

When you look at the yields of your companies, they are barely keeping up with inflation and by no means are beating inflation in a big way. Thus, you may win with .06% over 2% inflation but each and every dollar is inflating. Bernake wants a minimum inflation of 2% a year. After 25 years, the Fed will have destroyed your savings by 50%.

So your theory has two big holes in it: 1) picking real time winners from a massive herd of losers and 2) beating inflation in a big way with your winners that overcomes all other forms of inflation, wage inflation, savings inflation, the cost of living inflation all jumbled into one big happy sinking ship.

Mathematically it won't happen by your secret success formula. 

Pick me a new stock today that will beat inflation and be here in 50 years. And don't try to sell me on the tortous and hare, Gov with its rising taxes, Obamacare, and managed inflation is a hare not a tortous. You have to beat the hare. How do you do it without leverage? The simple answer is you can't. 

There's more. Even if we were to use the old rule that the indexes will continue over time to rise; is this an actual fact or a historic pertubation? I will grant you that the emerging markets will continue to expand via Asia, but it is entirely possible that after 250 years of industrial progress that the character o the the United States has changed so dramaically that we follow European countries into their abyss. I don't see many investors touting the European markets as "THE" place to be over the next century. In fact, I would submit that their delevering will continue to ride them down into a place an investor would never want to be. 

My background is physics and mathematics, not history. I believe the world is organized according to quantum probability waves and your claim as a stock picker is merely a regression looking backward in time which of course is impossible in the quantum probability wave for the simple reason among many that time itself doesn't exist outside the realm of man's brain. I know that will come as a shock to many but unless you ride the probability waves, you lose. That's house rules. Reality v. Wishful thinking. 

I see no mathematical underpinnings that support your conjectures. 

 

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