Strong Brands Grow Solid Dividends

I recently analyzed the annual report of spirits maker Brown Forman (BF-B), which is one of the newest additions to the S&P Dividend Aristocrats index. I was amazed to learn that some of its top selling products were Jack Daniel’s Tennessee Whiskey and Finlandia. It is very intriguing how the company has been able to leverage the brand name of its top selling products by cutting costs to the bone and increasing efficiencies, while at the same time expanding sales internationally. This had translated into growth in earnings per share, which also fueled a 9.8% average annual growth in dividends over the past decade.The similarities between Brown-Forman and other prominent Dividend Aristocrats do not end here. Most elite dividend stocks are household names, whose products and services are available to consumers and businesses worldwide. They are easily recognizable names for which consumers are willing to pay a premium in order to enjoy them.... Read more