Inflation is everywhere you look these days - energy, food, housing, travel, cars, etc.
The Federal Reserve has a challenge on its hands, getting 5%+ inflation under control. Over the next 6 months +/- we will know how successful they are.
In the meantime how can we position portfolios to stay ahead of rising prices? Growing dividends from high-quality companies is our answer and has been for years. Click here to see the companies that we have invested in on your behalf. The list includes 40 names, 30 of which pay regular dividends with the remainder being growth stocks such as Amazon, Google, Generac, etc. Occasionally one of our holdings pays a special dividend like T Rowe Price did, $3.00 per share in June 2021.
These 30 dividend payers have averaged an 8% annual increase. The projected increase over the next 5 years is close to 8% also. Several companies - Microsoft, Blackstone, Apple, United HealthCare, etc. - project 10%+ increases.
The great majority of these companies have paid dividends for many many years to reward shareholders. Each company has its own policy on how to allocate its annual profits & cash flow. This capital allocation can include dividends, buybacks & other investments in their business. We closely monitor the metrics surrounding capital allocation back to shareholders before buying stock on your behalf.
We are confident in the strength of these companies over the intermediate-term. Short-term events such as the war in Ukraine will present challenges to our companies and their stock performance. Therefore being patient and opportunistic is our strategy.
Be sure to email or call us with any questions, comments or concerns and please feel free to pass this along to others that may have an interest in our Investment services.