Hunting For The Right Dividend Stock

In the past two years, I have invested in several dividend stocks to attain regular income. Despite that I do not only invest in dividend stocks, I consider these stocks an important pillar of my portfolio.
One of the best sources of dividend stocks is the Dividend Champions spreadsheet [CCC]. The U.S. Dividend Champions were created by Dave Fish and are now maintained by Justin Law. The list contains more than 800 stocks in three categories - challengers, contenders, and champions. I filter this high number of stocks to a digestible number, based on dividend yield, dividend increase, number of consecutive years of higher dividends, P/E ratio, and Chowder rule. And, finally, I rank the survivors.
Dividend Yield
The S&P 500 yields around 1.85%. My goal is to find companies that outperform the S&P 500 while providing a safe dividend. Therefore, I look for companies having at least a 2.5% dividend yield. Of course, the higher, the better. But at the same time, I do not want to eliminate companies that provide low yield but have a great stock appreciation potential. Furthermore, very high yield is often not sustainable in the long run. After filtering, I can see 445 companies that stand this test.
Most recent dividend increase
I prefer dividend-paying companies that can really increase their dividend every year. Additionally, the most recent increase should also confirm that the company can increase its dividend in the current market environment. So, I look for... Read more