Dumpster Diving For Dividends

Investing In The Waste Disposal BusinessSometimes the least exciting businesses are the ones that can offer the most steady and reliable cash flows and profits which often translates into dependable dividend payments. We all know the saying "One man's trash is another man's treasure" and that may be the case when examining the waste industry for potential dividend payers to add to our portfolios. While experiencing modest growth in the U.S., the waste industry is estimated to be worth about $55 billion in annual sales. One unique feature of the waste industry is that all humans require their services as virtually no alternatives for garbage disposal exist. As dividend growth investors, we are constantly looking for solid dividend income plays from companies that offer 'must have' products or services, otherwise known as staples, while operating within a wide enough moat to potentially stifle any new competition that may arise. The waste disposal business showcases both the imperative and wide moat nature of this sector. It comes as no surprise then that this industry is a staple among many wealthy investors. In fact, Bill Gates, directly and indirectly through his venture arm Cascade Investments, owns a sizable stake in two of the largest players in the space, Waste Management, Inc. (NYSE: WM) and Republic Services, Inc. (NYSE: RSG) owning approximately 4% and 25% of each company respectively. With that being said, let's take an overview of some the of... Read more