The article presents my top dividend growth pick in each of the GICS sectors. I provide quality indicators, key metrics, and my risk-adjusted Buy Below prices for each stock.
For this article, I focused on dividend growth stocks in Dividend Radar, a weekly automatically generated spreadsheet from Portfolio Insight listing stocks with dividend streaks of five or more years.
Each stock is discounted to my fair value estimate and offers strong income and growth prospects. Moreover, the stocks I picked have Very Safe or Safe dividends according to Simply Safe Dividends.
To find candidates that offer strong growth prospects, I considered candidates with favorable Chowder numbers, namely those likely to deliver annualized returns of 8%.
To find candidates that offer strong income prospects, I considered candidates likely to have a 5-year yield on cost of at least 4% after five years of ownership.
I am trying to find some total return performance data for the portfolio. All the dividend performance data is nice but total return is important to me. What good is dividend performance if the portfolio is losing value? Obviously your portfolio is not losing value. What is internal rate of return? Does added capital influence the performance numbers? I am very interested in using your portfolio and updates to build my own portfolio. Currently I am using VYM and SCHD for my dividend allocation. I am trying to determine if there would be a worthwhile advantage to switching to managing my own dividend growth portfolio over using etfs. I suspect there would be. I am not new to investing. I have a retirement portfolio of around $750K. There is a lot of information/websites about dividend investing but I always seem to come back to you. Thanks for any information you can give me.
ReplyDeleteThanks for your note. My Monthly Reviews provide internal rate of return performance metrics for DivGro. The May Review reported 14.7%. That's (obviously) down from last December's 17.5%, but still good overall. With IRR (as you may know), the timing and size of capital deposits and withdrawals are properly accounted for.
DeleteI no longer own ETF's. I do own some closed-end funds for their higher yields. But the majority of my portfolio remains in individual stocks. Compounding via dividend GROWTH stock reinvestment is especially effective. Owning dividend growth stocks ensures an ever-increasing dividend, regardless if you reinvest. But if you do reinvest, you're adding an ever-increasing (generally-speaking) number of shares to positions and accelerating your income stream even more.
In retirement, not all of the dividend income can be reinvested because you need (some of) the income to cover living expenses. But dividend GROWTH stocks help to shield against inflation.