Fresh political drama and trade war woes rattle markets once again.
Given my investment strategy, I am much less concerned about day to day gyrations of the stock market.
Moreover, I am always looking to benefit from them in my search for new companies to add to my portfolio.
I therefore regularly compose watch lists with stocks to research further, and with the potential to become this or next month’s new dividend growth stock purchases.
There are currently two candidates on my September watch list:
Intel Corporation (INTC) and A. O. Smith Corporation (AOS).
Looking at the chart above, INTC’s stock price has declined significantly after their June peak .
I currently own 25 shares of INTC in my portfolio - and I added those at a price of $48.93. With the current price even below that level, I am interested in potentially doubling my position.
INTC provides a decent yield of 2.52%, and is a near Dividend Challenger with 4 years of growing dividend pay-outs.
It’s current P/E ratio is ~17 - still slightly above it’s 5 year average.
For a dividend investor like myself, the recent acceleration in dividend growth is quite appealing. Last year’s dividend growth was 10.09% versus it’s 5 year average of just 5.92%.
The second stock on my watch list is A. O. Smith Corporation (AOS).
Like INTC, this company’s 1 year price trajectory (above) is rather bearish.
It’s dividend features look appealing though. AOS boasts 25 (!) years of growing dividends, albeit with a modest current yield of 1.22%.
It’s current P/E ratio is around 31.13, above the 5 year average of 26.9.
The dividend growth rate is he most encouraging - with a 5 year average of 24.57% and last year coming in at 28.57%.
Both INTC and AOS are close to 52 week lows and have quite attractive dividend features. More research is required but they are serious contenders for near future purchases for my portfolio next month.
8 thoughts on “My Dividend Growth Stock Watch List for September”
Hey Tall, Thanks for stopping by today. I added you right into the Dividends Diversify blogroll. If you have a blogroll or can link out to DD in some way, some day, it would be appreciated. Tom
Hey Tom - thanks for including me! I need to update my Blog Roll (long overdue). When I do, I’ll be sure to include you.
Interesting picks. What about ITW? How about CVS or WBA? Thoughts on them? Valuations seem a bit high up there, I’d like to see those P/Es lower!
After Bert’s post about ITW I have a taken a closer look at the stock, wasn’t really on my radar before. The acceleration in dividend growth looks really good, but even after the recent price declines the PE still looks a little rich. I added the stock to my screener.
On CVS/WBA: I have added CVS on dips, and now have 60 stocks. Since it’s one of my larger positions, I will not likely adding more soon. Also would like to see some dividend growth again, after they complete the merger with Aetna.
WBA looks good to me too, and came through with a nice 10% div increase recently. Both look like good dividend investments, but provided CVS will resume the dividend growth post Aetna, I am sticking with CVS.
Thanks for stopping by!
I saw your response to Lanny’s comments above. I’m not as familiar with AOS, but their PE is slightly high for me right now and their yield is lower than I would like for a stock at that multiple! Do you have a certain price point in mind for the company?? INTC is great though and I’m sure they will find a way to work through some of the headwinds they have faced recently.
Yes, always pros and cons when selecting stocks. Current yield and PE leave something to be desired, but dividend history (25 years), accelerating dividend growth and low pay-out ratio look quite appealing. I might combine with low yielding purchase with a high yielder such as D…. We’ll see. For INTC - the stock seem to be climbing again so might hold off for now and wait for a better entry point.
I’m not so familiar with AOS, but INTC is always on my list too. Lovely P/E and promising dividend future. Thanks for bringing up AOS to my attention, will look more into it. I myself was thinking about BlackRock (BLK) for September, care to share your thoughts on that one?
INTC remains attractive below 50 IMHO.
I haven’t really been tracking BLK so can’t help you there I’m afraid…but will take a closer look.