Contrarian Ideas: 6 Dividend Champions Being Sold by the Smart Money

The following is a list of “dividend champions” - companies that have increased dividend payouts for more than 25 consecutive years. Additionally, all these stocks have seen net institutional selling over the last two quarters.Given the history of these names and the apparent negative sentiment from institutional investors, which of these stocks do you think is being underestimated? Click for expanded images:1. Universal Corp. (UVV): Tobacco Products Industry. Market cap of $997.05M. Dividend yield at 4.52%. On a net basis, institutional investors sold -867.1K shares during the current quarter and -502.8K shares during the previous quarter. The stock is a short squeeze candidate, with a short float at 12.23% (equivalent to 11.13 days of average volume). It's been a rough couple of... more

3 Dividend Stocks for Your Watchlist

As I explained in a recent article, I look for dividends as a way to play stocks. Ideally, I'm looking for the dividend as a catalyst to fuel stock price growth. So with that, here are three dividend stocks I'm following and that you can follow, too, using our free Watchlist service. 1. Frontier Communications (NYSE: FTR ) I've highlighted Frontier as one of the best dividend stocks for 2011, as the company consolidates operations that it acquired from Verizon (NYSE: VZ ) last year. While the stock has taken a hit after the most recent earnings release because of consolidation difficulties, the stock still sports its 9.3% yield while we wait for the company to integrate operations. That yield is still notably higher than key wireline competitors Windstream (Nasdaq: WIN ) and... more

The 5-Year Rule in Dividend Growth Investing

This is the fourth in an occasional series about my public Dividend Growth Portfolio. The portfolio is designed to demonstrate how dividend-growth investing works. The first three articles were: Portfolio Forensics (August 31, 2010), Watching Dividends Rise: Putting Together a Focused Dividend-Growth Portfolio (February 1, 2011), Road Map for Managing a Dividend Growth Portfolio (February 23, 2011). In this article, I want to expand on a particular element of my strategy for picking dividend-growth stocks: The 5-year rule. The rule simply says that a company must have raised its dividend for at least 5 consecutive years before it is eligible to be purchased for the Dividend Growth Portfolio.The thinking is straightforward. Since the goal is reliable dividend growth, I want to select... more

The Most Promising Dividends in Apparel

Yields and growth rates and payout ratios, oh my!Before we get to those companies, though, you should understand just why you'd want to own dividend payers. These stocks can contribute a huge chunk of growth to your portfolio in good times, and bolster it during market downturns. As my colleague Matt Koppenheffer has noted: "Between 2000 and 2009, the average dividend-adjusted return on stocks with market caps above $5 billion and a trailing yield of 2.5% or better was a whopping 114%. Compare that to a 19% drop for the S&P 500."... more

Dividend Scan: INFY, DOW, AT, MCHX, UTX, LNT, MVC, HPT, SM, NNN

As the US market returned to positive territory during the mid-day trading, several companies declared their future dividend plans. Some notable dividend payers are discussed here. Infosys Technologies Limited (Nasdaq: INFY) declared an increase of 400 percent in its final dividend to Rs 20 per share from its previous dividend of Rs 5. However, shares of the company tumbled 14.05 percent or $10.26 to $62.75. Shares of Dow Chemical Company (NYSE: DOW) gained 1.98 percent or 73 cents to $37.66 as it declared Q2 dividend of 25 cents per share from 15 cents. Atlantic Power Corp. (NYSE: AT) announced a dividend of C$0.0912 per common share, payable on May 31, 2011 to shareholders of record on April 29, 2011. Shares of the company added 0.27 percent or 4 cents to $14.62. Marchex Inc... more

These 3 Dividends Will Solve Your 44% Problem

Read on, and I'll show you how to avoid pricey stocks in this potentially inflated market, and cash in on three dividend knockouts. I'll also share with you how to get free access to 13 more outstanding dividend payers, courtesy of The Motley Fool's expert analysts. The problem … and the solutionYale economist Robert Shiller successfully called out the tech bubble in 2000 and forecast the housing bust in 2006. Now he's making another a dire prediction: The stock market could be overheated, and it's expensive relative to its historical valuations. Shiller's method illustrates that the general market is priced at about 23 times earnings, way above the average of 16. That 44% premium could represent a huge problem.... more

8 Dividend Stocks for the Ultimate in Deferred Gratification

Deferred gratification is a principle where one or more people choose to postpone near-term benefits in order to enhance their chances of greater benefits in the future. In our microwave society marked by the ‘I want it now’ attitude, it is unusual to find someone willing to wait. However, deferred gratification is essential for anyone wanting to build wealth and is a key ingredient in a successful dividend investing strategy. Below are several stocks building future gratification with the promise of higher future cash dividends: Omega Healthcare Investors, Inc. (OHI) OHI is a real estate investment trust investing in and providing financing to the long-term care industry. April 14, the company increased its quarterly dividend 2.7% to $0.38/share. The dividend is payable May... more

15 Dividend Stocks With A 15% Yield In 15 Years

I skate to where the puck is going to be, not where it has been." - Wayne Gretzky I know very little about hockey, but I have always loved this quote. It can be applied to so many things in life, including investing. Just as Gretzky has a vision as to where the puck is going, investors need to have a similar vision, and not get caught up on short-sighted distractions. Investing in dividend growth stocks requires a long-term vision. It is easy to run a screen and find stocks that are paying a 15% yield today; but how long will they be able to sustain it? Instead you may want to skate to where the future 15% yielders are going to be. To do that, here are some things you need to know... Tracking Yield On Cost Yield-on-cost (YOC) is simply Current Annual Dividend dividend by... more

7 Low Priced Dividend Paying Stocks

Mueller Water Products (MWA) Stock price: $4.06 Dividend: 2.90% Mueller Water provides water infrastructure and flow control services. The popular water investment is owned by Glenview Capital Management whose recent shareholder letter contained bullish opinions about Tyco International (TYC) and Expedia Inc (EXPE) which subsequently made positive headlines in the ensuing weeks. Mueller could have secular tailwinds at its back, but in the last two three years, both revenues and operating cash flows have declined. In addition, Mueller has nearly $692 million of debt on the balance sheet.Nokia Corporation (NOK) Stock price: $8.74 Dividend: 4.70% The world's largest cell phone manufacturer has struggled against competition from Samsung (SSNLF.PK), Apple (AAPL) and Android-based... more

7 High Yield, Growing, US Healthcare Companies Trading At Reasonable Valuations

Last time, we looked at high yield, attractively valued, technology companies. While those are more of a rarity than value-priced healthcare companies these days, let's turn our attention today to the healthcare sector to look for some attractive income plays. While there is a lot of uncertainty in the healthcare sector these days, we can look for companies where that risk already appears to be priced into a low valuation multiple. Using the Screener.co stock screener, we can filter for companies that meet the following criteria: Field op Criteria Exchange Traded On != "Over The Counter" Sector = "Healthcare" Dividend Yield-indicated annual dividend divided by closing price >= 0.01 Current EV/EBITDA <... more