Portland Electric (POR) is my Dividend Machine for week of December 10, 2012

           

            My dividend project requires me to add the first company that qualifies as a dividend machine to my weekly list.   I do not search every day.    When I search for a dividend machine, I use several sources including TheStreet.com’s ex-dividend calendar; the Wall Street Journal’s dividend change feature, and sometimes I just run across a company through press releases or general news.   This week I started with TheStreet.com and found this company in the first group of stocks I researched.

 

            Portland Electric is an electric utility in the Northwest.  Today it traded around $27.28.  If you own it by December 21, 2012, you will receive the quarterly dividend of $.27 on January 15, 2012.  This is an annual dividend yield of 3.97%.

 

            Fundamentally, Portland Electric is a solid dividend machine.  POR’s earnings for the last four quarters were $1.87 and dividends paid out for the same period were $1.07.  Dividends have increased every year for six years.  Debt to equity ratio (D/E) is 1.01.  These data are presented in the table below.

 

	DIVIDEND MACHINE	12/12/2012
	Portland Electric	POR
	Price when profiled	$27.28
	Last 4 Qtrs Earnings	$1.87
	Last 4 Qtrs Dividends	$1.07
	Current Qtr Dividend	$0.27
	Annualized Div Yield	3.95%
	No. Years Div Increase	6
	Debt/Equity ratio	101.00%

           

            I never try to sell my dividend picks.   Remember the dividend machine project requires discipline and therefore specific rules.   I do not pick the best dividend machine each week; I profile the first one that complies with my rules.  With that said, I occasionally provide the fifth dimension which is my or another person's opinion in support or dissent.

 

            In support of POR is David Dreman.   Read his review from Seeking Alpha in this link.http://seekingalpha.com/article/1057481-5-value-dividend-stocks-for-investing-like-a-contrarian?source=msn

 

Consider POR for the income producing portion of your portfolio and fear not going over the “fiscal cliff.”

 

Very Truly Yours,

 

TheMoneyMadam

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Dividend Machine for December 3, 2012

F-14ATomcat (Photo credit: John H Gray)

Northrup Grumman (NOC) is my Dividend Machine for week of December 3, 2012

           

            Personally, I hope we go “over the fiscal cliff.”  That is not the subject of this post but it is relevant.  You see by going over the fiscal cliff, maybe we could force the government into some type of budget control.  The fiscal cliff requires defense spending cuts.  This cannot help but provide buying opportunities in aerospace and defense companies.   Another factor relating to the fiscal cliff and income investors is the effect on dividends.   Dividend companies will suffer for a while because by going over the “fiscal cliff” taxes on dividends will increase from 15% now to as much as 43%.    However, if you use qualified retirement accounts for your dividend machines, you will get some bargains.  Those of us who use ROTH IRA accounts for dividend companies can buy these companies on sale and receive distributions that are tax free.   So I say go ahead, go over the cliff.

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Laclede Group Inc. dividend machine for Nov. 26, 2012

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Norfolk Southern, NSC Dividend Machine for week of 11/12/2012

Norfolk Southern Engine along KCS rail. (Photo credit: Wikipedia)

Norfolk Southern, NSC is my Dividend Machine for this week  November 12, 2012

           

            In every crisis, an opportunity can be found.  The transports were killed today and today I looked for dividend machines and would you not know it, Norfolk Southern was the first company I found to qualify as a dividend machine.

 

          

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Questar STR Dividend Machine for 11/8/2012 Are utilities still a good income investment?

English: Natural gas burning (Photo credit: Wikipedia)

Questar symbol STR Dividend Machine for week of November 5, 2012

           

            Questar is a gas utility that serves the Rocky Mountains and Questar is the first dividend machine I found today.   The most recent trade was $19.37 which makes STR a very affordable dividend machine for investors.  STR also fulfills the needs of investors who want an energy play that concentrates on gas.

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Magellan Midstream Partners, MMP dividend machine for week of October 29, 2012

Magellan Midstream Partners, MMP is the dividend machine for the week of October 29, 2012.

           

            Magellan Midstream Partners, MMP is the first dividend machine I found for this week, October 29, 2012 and I’ll tell you I sifted through no fewer than forty two companies before finding MMP.   

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McDonalds Company, MCD Dividend Machine for week of Oct 22, 2012

McDonalds,  when populations increase they eat more McDonalds - Dividend Machine for the week of October 22, 2012.

           

McDonalds, symbol MCD, has been on my radar many times in past decades.  However, once I started using my very specific dividend machine criteria, MCD did not show up as the first dividend machine I found with my screen until this week.   Like MSFT, McDonald’s price was too high or the dividend too low to qualify as a bona fide dividend machine.   Recently, McDonald’s qualified on every other dividend criteria except yield and now we have the dividend yield greater than 3%.

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Microsoft, MSFT took a long time to show up as a dividend machine!

Microsoft wordmark. (Photo credit: Wikipedia)

Microsoft, MSFT dividend machine for week of October 8, 2012

I have been searching for dividend yield for this blog (and my research project) every week for nearly two years and only today, did Microsoft show up.  In the past either their dividend was too low or their stock price too high to make the minimum dividend yield criteria.

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DIVIDEND MACHINE Week of October 1, 2012

Capitol, Washington DC (Photo credit: Wikipedia)

Dividend Machine for week of October 1, 2012 WGL Holdings Inc. (WGL)

           

What a fun day I had searching for this weeks’ dividend machine.  During my search, I cannot help but run across information on companies that I have already included in my 2012 dividend machine list.   I found some lovely news about last week’s dividend machine, Watsco symbol (WSO), see side bar of this blog called The Money Madam’s Musings.

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Dividend Machine for week of 9/24/2012 Watsco (WSO)

Air handling unit (AHU) (Photo credit: Wikipedia)

Watsco dividend machine for week of 9/24/2012

          One might think that a company in the HVAC business is no place to invest your money with our housing market in the dumps.   Since I do not use current trends or even long term trends as selection criteria for dividend machines, I did not let that influence my dividend machine choice for this week. I leave that kind of input for you to use to decide if you want to a particular dividend machine or not.

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Eat your way to income Darden (DRI) Dividend Machine for week of 9/10/2012

The company's former logo, used until 2009 (Photo credit: Wikipedia)

My Dividend Machine for week of September 10, 2012 is Darden Restaurants (DRI)

            Each week I search for a company that meets all four of my criteria for inclusion into the Dividend Machines List.  I do not always like what I find.

            This week I found Darden Restaurants, symbol DRI.  Darden meets all four criteria for inclusion in my 2012 dividend machine list just as it did in 2011.  

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Dividend Income increases with MDU Resources

Dividend Machine for week of 9/3/2012 MDU Resources

This week’s dividend machine is MDU Resources.  MDU made the 2011 dividend machine list as well.  MDU Resources, symbol (MDU) is in the business of natural resource products and related services needed for energy and transportation infrastructure.   MDU is an industrial company; the kind of company that America is built upon.

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Can I find a dividend machine in the financial sector?

AUBN was the first dividend machine I came across in my pursuit of a dividend machine pick for this week.   Since I believe in disciplined investing, I have to stick to my plan of finding forty-eight dividend machines in 2012 and for profiling the first one, I find that week.  I do not market time, I do not screen by sector and I do not use market capitalization.  I only use my four key dividend machine criteria to find a dividend machine.

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Dividend Machine for week of 8/20/2012 CINF

The Ohio state seal. (Photo credit: Wikipedia)

            Catastrophes come and go but insurance companies seem to be able to weather most storms.  At least Cincinnati Financial symbol (CINF) has been around for a long, long time having weathered many storms. 

            Using my four dividend machine criteria (see the left hand column to review these criteria); you can see that CINF easily makes the grade.

            CINF is located in Ohio.  This well managed company has paid a dividend since 1954 and increased the dividend every year for the past

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TransCanada TCP Canada provides the dividend machine for August 13, 2012

English: C.D. Howe (NFB image) The Hon. C.D. Howe at the official ceremony at the border of Canada and United States of the joining of the pipeline from an oil tanker terminal, Portland, Maine with refineries in Montreal, P.Q. (Photo credit: Wikipedia)

TransCanada Corporation, symbol TCP, my 31st dividend machine pick of 2012.

           

            Few non-USA companies qualify as dividend machines.  My trepidation over selecting foreign companies as dividend machines is due to my mistrust of international accounting.  Other factors like currency exchange make investing in international companies even more complicated.  

Let me be clear about international companies; I do invest in them.  However, the duty of this blog is to find 48 dividend machines in 2012 and to offer covered call and interest income ideas.  

This week's dividend machine is number 31.  As I searched for a company that meets all four criteria, the first dividend machine I came across was a company from Canada.   Canada, our cousin country, has well established accounting rules and that allow me to feel more comfortable naming TransCanada Corporation (TCP) as this week’s dividend machine.

            Everybody has heard of the TransCanada Pipeline also known as the Keystone Pipeline.TCP is the company that would build that pipeline.   In 2000, the TransCanada energy company made some changes and now is a leader in oil and gas equipment and servicing.

            It matters not how you feel about the proposed pipeline, as income investors we care that the company wants to maximize our income and is committed to pay us increasing income over time.

            With that vision in mind, review the data in the following table (based on closing price Friday, August 10, 2012) to determine if TransCanada, TCP, is a dividend machine that you would like to include in the income producing portion of your investment portfolio.

TransCanada Corp. TCP
Price when profiled	$45.18
Last 4 Qtrs Earnings	$2.06
Last 4 Qtrs Dividend	$1.74
Current Dividend Yld	3.85%
No. of Years increased	8
Debt/Equity ratio	10.00%

Very Truly Yours,

TheMoneyMadam

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Drug Store Walgreens WAG Dividend Machine for July 30, 2012

Walgreens drug store electric sign, Milwaukee (Photo credit: mechanikat)

Dividend Machine for week of July 30, 2012 Walgreens (WAG)

           

            The ongoing effort to find a dividend machine, every week, continues.  This week I found Walgreens drug stores.  This huge company has raised the dividend every year for 36 years.  Their most recent dividend increase makes the dividend the biggest ever in company history.   To learn more about this dividend increase see this link.http://investor.walgreens.com/releasedetail.cfm?ReleaseID=684069

            During the past four quarters, Walgreens earned $2.80 per share.   They recently made an acquisition that should set the stage for future business growth that will equal or exceed their stellar growth history.  WAG paid out $.90 in dividends during that same

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Dividend Machine for week of July 23, 2012 UVV

HAVANA - FEBRUARY 25: A Cuban tobacco worker prepares a cigar in the Cohiba tobacco factory on February 25, 2010, in Havana, Cuba. The Cohiba tobacco factory is preparing a new line of the Cohiba brand, Behike, to be presented during tomorrow�s gala dinner and closing auction ending the annual Habanos Tobacco Festival, that takes place in Cuba from Between February 22 to February 26. (Image credit: Getty Images via @daylife)

Dividend Machine for week of July 23, 2012 Universal Corporation (UVV)

           

            Get over it right now!  Universal Corporation sells tobacco and it makes a lot of money selling tobacco.  Universal (UVV) earned $3.25 per share during the last four quarters and paid out $1.94 in dividends.  

            UVV, trading at about $46.59 is near its high.  My dividend machine project does not use stock price to determine if a stock like UVV should be included in my 2012 dividend machines list.   Therefore, we should look at the four key criteria that define UVV as a dividend machine.

            Current quarterly dividend is $.49 per share.  At $46.59, the dividend yield is 4.2%.   UVV earned $3.25 during the last four quarters and paid out $1.94 in dividends.  This company, it appears to me will be able to continue to pay me income. In spite of efforts to reduce tobacco use, UVV has been able to grow earnings enough to fund dividend increases every year for fifty-eight years.  Their debt to equity ratio (D/E) is .45.

            You might consider UVV for the portion of your portfolio dedicated to income.

Very Truly Yours,

TheMoneyMadam

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Dividend Machine for week of July 16, 2012 NJR a gas utility

                Utilities are riding high these days.   The index of all utilities is in the mid $400’s.  I remember early in my investing career the same scenario when utility company stocks prices were very high.  I also remember when the index of their prices was in the mid 170’s.   That means that utility stock prices not only could but also will moderate in the future.  I am not a stock market timer, as you know.  I kept most of my utilities through thick and thin reinvesting the dividend during times when the stock price was low and cashing those dividends when the stock price is high.

               

                What should be the distinguishing quality between two utility choices?  Of course, the dividend has to be above three percent.  When a utility has also raised the dividend every year for at least five years, my interest in that stock increases.   When a utility has always earned more per share than it pays out in dividend, I am tempted to include it in the dividend machine list.  Then when I find a utility with little debt, I can include it in my 2012 dividend machine list.

                New Jersey Resources (NJR) is a gas utility that is not limited to New Jersey.  NJR provides gas utility services from the Gulf States up to New England.  Their most recent financial report was very strong.  And NJR is my dividend machine for this week. 

                The table below presents NJR’s dividend machine criteria.  The dividend yield at today’s price of about $46.03 is 3.3 %; their previous four quarters earnings were $2.99 per share; their previous four quarters dividends were $1.48 and their D/E (debt to equity ratio) of .73 is below the industry average.

New Jersey Resources (NJR)
Price when profiled	$40.03
Last 4 Qtrs Earnings	$2.99
Last 4 Qtrs Dividend	$1.48
Current Dividend Yld	330.00%
No. of Years increased	16
Debt/Equity ratio	0.73%

                As you build your dividend machine portfolio, you might consider NJR as one of the utilities.

Very Truly Yours,

TheMoneyMadam

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