The Dividend Post

What's New on Investor Value Reports

2009-02-16T20:34:00.002-05:00

As my previouspost indicates, I have created a new site called www.investorvaluereports.com

The latest entry for this new service is a company called Stryker Corp.
You may locate my data at
http://www.vmwinc.com/InvestorValueReports/Stryker/SYKgateway.htm

Please send me your feedback or post your feedback on this blog.

Thanks

Nicholas

Change of Name

2009-02-16T20:32:00.003-05:00

I have changed the name of my website to include The Dividend Post as well as the new title Investor Value Reports. As I profile both dividend paying stocks as well as great value stocks, I have created two web sites.

www.dividendpost.com
www.investorvaluereports.com

Please drop in for the latest updates.

Visit us at www.dividendpost.com for research

Pensions Time Bomb

2008-10-29T04:21:00.002-04:00

A very important article has appeared in The Globe and mail, one of Canada's national newspapers. The article appears at:

http://www.reportonbusiness.com/servlet/story/RTGAM.20081029.wpension29/BNStory/Business/home

Pension plan obligations continue to be another "hidden time" bomb that investors must be wary of. Canadian investors, based on this article, must take pension obligations into account prior to investing capital into Canadian issues. We will be looking for a the government's response and resolution to his problem.

More on this subject will be forthcoming, but for now, beware.

Visit us at www.dividendpost.com

Another Kick at the Can

2008-10-09T13:48:00.007-04:00

Sometimes the deals are just too good to be true so we take another kick at the can.

3M Company remains on my list of great franchises to own for the long term. The stock along with just about every other stock on planet earth has just taken a drubbing. As a result I have decided to promote this issue again to readers. I will be placing another buy into our portfolio and I like the current yield and long term prospects. 3M Company is now trading in the $ 57.00 range down from our $ 70.00 recommendation. I will be averaging out and buying more as the yield stands at 3.3%, and I expect long term significant gains.

As always, members of my mailing list receive a FREE user ID and password to access all data research available at The Dividend Post, as well as to receive updates as new issues are posted.

Get Paid to Wait

2008-10-07T08:28:00.007-04:00

The proverbial brown stuff hit the oscillating blades yesterday. Dividend investors, invested in cash generating businesses with limited debt or strong brands will get paid to wait out the storm.
These types of investments leave conservative long term investors many opportunities and strategies.

1) No Fear Factor - If you have a higher tolerance for risk, down times such as these provide ample opportunity to step up with larger amounts of capital to buy issues trading at large discounts.

2) Fear Factor - If your tolerance for risk is limited, then continue buying into the markets during good times and bad with limited amounts of capital every investment period, whatever period that makes you comfortable. Monthly, weekly, semi annually, etc.

In either case however ONE distinct premise must remain intact - the companies in which you invest MUST have the wherewithal to withstand the storm and maintain their dividend. Cash remains king.

Our scorecard to October 1st has been posted online at
http://www.vmwinc.com/DP/ScoreCard/SCHome.htm

The scorecard is based on item 2 (Fear factor) above . One share of each company is included in the model portfolio. This translates into equal share purchases on a regular basis.
You may for example wish to purchase 10 shares, 20 shares, 100 shares of each issue whenever you make a purchase. Your results will vary if you purchase different share amounts of each issue depending on the share price and cash availability.

As always, members of my mailing list receive a FREE user ID and password to access all data research available at The Dividend Post, as well as to receive updates as new issues are posted.

They're Great !!

2008-10-01T13:10:00.005-04:00

Today I have posted data for General Mills. The share price has unfortunately risen significantly since I started punching the numbers earlier in the week. At any rate, this is a sound company that takes a commodity that is now falling in price, and puts it in a box for you to eat. The company has strong brands which is something I look for in all recommendations of consumer products.

At the same time you can compare notes with Kellogg Company which was profiled last week. These are the types of companies with wide moat brands. If I was to start a cereal company tomorrow, I would hate to have to compete against Corn Fakes or Frosted Flakes.

As always, members of my mailing list receive a FREE user ID and password to access all data research available at The Dividend Post, as well as to receive updates as new issues are posted.

A word on Debt

2008-09-30T11:12:00.005-04:00

As long term investors, security and income are paramount to success. A growing income stream is very welcome as long as the underlying companies paying out the dividends remain healthy. Given the current financial crisis, a companie's debt load becomes a more important factor to consider going forward. As capital becomes more difficult to obatin, companies with large debt loads in many cases will have problems financing day to day operations. As investors, conservation of capital becomes more and more important moving forward. In the past, a company with a strong franchise but a high debt load may have been considered for inclusion in our list. This will change now until capital markets stabilize.

This should also serve as a reminder to all that over the long run, strong balance sheets with little debt, strong business franchises, and comitted management will ultimately pay of in higher returns down the road, or as today's markets show us, preservationof capital duringthe rough times.

Mailing list members, look for more updates in your email box, and if you are not yet a member, join now at The Dividend Post/MailingList

Please visit me at The Dividend Post

What Now ?

2008-09-29T16:39:00.002-04:00

As the financial news worsens from day to day, I have been receiving inquiries ranging from "what should we do now" to "the sky is falling".

It is very interesting that investors panicked to buy when prices fall and ecstatic to buy when prices are high. As long term players looking to cash in on growing dividend income, we get paid to wait with our current holdings, and those of us with excess cash can search the markets for opportunities for buying in at very attractive prices.

Keep watching for new opportunities at The Dividend Post.

Locating Dividend Data is Easy

2008-09-24T05:01:00.006-04:00

My favorite online spot to locate the dividend payment history of any particular issue is located on Yahoo. Just go to Yahoo.com and locate the finance link. Enter the ticker symbol and request a quote. On the left size of the page a many links where financial data is listed.

Visit the JNJ quote page as an example: http://finance.yahoo.com/q?s=jnj

Top left locate the link called "Historical Prices" - For JNJ this link is located http://finance.yahoo.com/q/hp?s=JNJ

Top Right: Click on the button that indicates "Dividends Only" and GET PRICES.

This is a great tool to scan quarterly payments over long periods pf time. Consistency and constant increases are what I look for.

Locate research online at www.dividendpost.com

Join my ever growing mailing list HERE to receive updates and the latest research.

Sysco Foods - More Good News

2008-09-22T16:28:00.003-04:00

Sysco has sent out some great news to shareholders today announcing a new stock buyback. We will take dividends in any form they come as long as they are not diluting our position. Sysco has the cash to return value to shareholder.

SYY analysis is online at The Dividend Post

Updates: Septtember 21, 2008:
HOUSTON, Sep 22, 2008 (GlobeNewswire via COMTEX News Network) -- SYSCO Corporation (NYSE:SYY), the world's largest foodservice marketer and distributor, announced today that its Board of Directors has approved a 20-million-share repurchase program.
The approved program is SYSCO's fifteenth share repurchase program since fiscal 1992. SYSCO's previously approved 20-million-share repurchase program from July 2007 has approximately 3.0 million shares remaining. These remaining shares will be repurchased prior to the initiation of the new program. Under the new repurchase program, shares will be acquired in the open market or in privately negotiated transactions at the Company's discretion, subject to market conditions and other factors, and in accordance with applicable laws, rules and regulations. The Company may use 10b5-1 plans from time to time in connection with its repurchases.
"Our share repurchase program is one important part, in addition to investing in our business and returning cash to shareholders through dividend payments, of utilizing cash flow from operations," said Bill DeLaney, SYSCO's executive vice president and chief financial officer. "For the last 16 years, we have returned a total of approximately $9.4 billion to shareholders, consisting of approximately $5.8 billion in share repurchases and approximately $3.6 billion in dividend payouts."
SYSCO is the global leader in selling, marketing and distributing food products to restaurants, healthcare and educational facilities, lodging establishments and other customers who prepare meals away from home. Its family of products also includes equipment and supplies for the foodservice and hospitality industries. The company operates 180 distribution facilities serving more than 400,000 customers. For the fiscal year 2008 that ended June 28, 2008, the company generated more than $37 billion in sales. For more information about SYSCO visit the company's Internet home page at www.sysco.com.

3M Company - Now at www.dividendpost.com

2008-09-22T16:24:00.005-04:00

3M Company holds great promise for readers looking for a great brand, strong financials, as well as a great longterm history. Visit my analysis online at www.dividendpost.com.

Look for the data HERE

My take on KFT

2008-07-29T14:44:00.001-04:00

I have posted some data on Kraft Foods (KFT). A good defensive selection in a volatile market, with good upside potential and a nice dividend to boot. I expect this dividend to increase over time, providing a steady "paycheck". Look for my data online HERE

A Little More on Certainty

2008-07-28T17:52:00.002-04:00

High probability of a return in the future, with a growing dividend.

I have just posted my analysis of The Donaldson Company as an afterthought to my previous post discussing certainly, or more precisely, the lack of. This company possesses many of the criteria I look for and my thoughts are now online HERE at The Dividend Post

Some Thoughts on "Certainty"

2008-07-28T17:35:00.004-04:00

While it is exciting to evaluate new technologies and growth areas in the markets, I prefer to have a fair probability of a "certain outcome". I want to be as "sure as I possibly can" that my investment will provide the return I have estimated. This is preferred to a great return earned on an unpredictable outcome.

A perfect example of this type of thinking can be gleaned from the recent takeover attempt of Yahoo by Microsoft. There are several factors at play here.

1) The takeover premium at the time was almost 33% given the offer price to the share price. As a betting man, this would have returned a handsome profit to those who like to dabble in arbitrage.

2) Despite its current issues, Yahoo is still the top visited website in the world. A brand identity is extremely valuable and this is probably not reflected in the share price.

3) Yahoo is in an exciting industry with enormous potential over time.

SO What's the problem........

Yahoo will probably be sold at a premium sometime in the future. The problem here is the lack of certainty. When will this occur? What will the price be?

Yahoo is a great brand...... true, but how great given the still relatively young history of the internet. One thing is certain, that evaluating Yahoo's position in the search and advertising marketplace over the coming years will be difficult to evaluate. The high tech landscape changes quickly, and predicting Yahoo's place in t his marketplace will be difficult.

3) The internet is an exciting place to be given the fast pace of change and opportunity. Precisely why I do not want to be there investing on the front end.

So where does one turn........... try The Dividend Post for some straight talk on the future.

This BUD's for you

2008-05-23T15:45:00.003-04:00

The Financial Time’s FT Alphaville reports that InBev is planning to make an offer of $65 per share for Anheuser-Busch. That values the U.S. brewing giant at $46 billion.

I have posted BUD and coverage was initiated on Feb 1 2008. Please take a look at the dividend potential. Throw in a chance to make $ 65.00/share and things become interesting.

Visit BUD at The Dividend Post and sign up for a FREE membership

Buy Mutual Funds at your own peril

2008-05-23T15:26:00.004-04:00

I am starting to post some facts and figures around the high cost to participate in mutual funds. Do I think investors would be better to go it alone..........

The average Canadian MER of 2.1% curtails registered retirement savings plans by 47 percentage points over 30 years"

The Rule of 40

To compute how long it takes mutual fund management expenses to consume one third of your investment: take 40 and
divide by your mutual fund's MER. or... After "n" years, the percentage of your money you get to keep in a mutual fund is:

(1-MER)n * 100

"In 25 years, a one-time $10,000 investment earning 10% per annum would be worth $15,885 more, just because of a 1% saving in MER."

Let's do the math - $ 100,000.00 one time investments will cost you $ 155,885.00 after 25 years.

Most funds charge a lot more than 1 %. ......... now do the math !

Mutual fund costs are shameful.

MUCH MORE TO COME ..

Visit my site at www.dividendpost.com

Power Corporation of Canada

2008-05-19T14:35:00.002-04:00

POWER CORPORATION OF CANADA

POWER CORP. OF CANADA (POW) is an international management and holding company based in Canada. Its principal subsidiaries are Power Financial Corp., Power Technology Investment Corp. and Gesca Ltee. Subsidiaries of Power Financial include Great-West Lifeco, IGM Financial, London Insurance Group, Canada Life Financial, Putnam Invest., LLC Investors Group, Mackenzie Financial Corporation, and its affiliate Pargesa Holding SA.

I have initiated coverage of this great company as the current yield is at an extremely attractive
level. I expect great POW to provide great results for my readers over time.

Join the Dividend Post with your FREE access

My View of The World

2008-05-19T11:11:00.000-04:00

Dividend Post

www.dividendpost.com

THE THREE MOST IMPORTANT NUMBERS

FOR DIVIDEND GROWTH

1) Net Income

2) Depreciation and Amortization

3) Capital Expenditures

Dividend To Cash Flow Ratio

I like to refer to this as the DTCF Ratio

Accounting rules require companies to disclose their financial statements and the three numbers that
interest dividend investors (according to me would be as follows:

Net income (or alternatively Net Income Per Share) is equal to all revenues minus all expenses

Depreciation and Amortization

Capital Expenditures

Now for a “very brief” explanation:

Depreciation and Amortization is an expense category:

This expense category of is a non cash expense. Companies depreciate assets much like
the car you recently purchased. Over time, the assets a company collects lose their vale.
The accountants call this depreciation, which really means the assets are “used” and getting older over time.
They deduct and amount every year from the revenues to reflect this depreciation, however the company does
not disburse any cash for this accounting entry. It is simply that………… an accounting entry.

Capital Expenditures - another fancy term in accounting parlance to explain new assets a company must purchase
to either replace the used stuff, or keep up with new technologies. In simple terms, when your car gets old, you buy a new one.
This is a capital expenditure in accounting terms. Capital expenditures are cash disbursements and can be VERY BIG
in certain companies.

Here are two simple examples:

Company WE SPEND CASH INC. in year 1:

Net Income in year 1= $ 0.90
Depreciation in year 1 = $ 0.50

Total cash flow available to shareholders n year 1: $ 1.40

Capital expenditures in year 1: $ 0.55

Cash Flow available for shareholders: $ 0.90 + $ 0.50 - $ 0.55 = $ 0.85

Dividend: $ 0.10

Dividend / Cash Flow

$ 0.10 / $ 0.85 = 15 percent

15 percent of the cash flow is used to pay dividends.

Company “WE SAVE CASH INC.” in year 1:

Net Income in year 1= $ 0.90
Depreciation in year 1 = $ 0.50

Total cash flow available to shareholders: $ 1.40

Capital expenditures in year 1: $ 0.40

Cash Flow available for shareholders in year 1: $ 0.90 + $ .50 - $ 0.40 = $ 1.00

Dividend / Cash Flow

Dividend: $ .10

$ 0.10 / $ 1.00 = 10 percent

In this case, company XYZ is paying out 10 percent of their cash flow as dividends.

On the surface it would appear that 15 percent is better than 10 percent, but in this case,
that is not true. And the reason is very simple…… Company We Need Cash Inc. requires more money
to fund capital expenditures than company WE SAVE CASH INC. Company WE SAVE CASH INC. earns the same as company
WE SPEND CASH INC., but requires less capital. The result is that company WE SAVE CASH INC. will have an easier time
paying dividends, and an easier time “INCREASING” dividends, over time.

Let’s assume both shares trade for $ 2.00 per share.
The Dividend Yield for both companies = $ 0.10 / $ 2.00 = 5 %
Consider the yield of 5% as the equivalent of an interest payment.

OVER TIME the company that can keep their dividend to cash flow ratio, as described above,
consistent or “LOWER”, the better chance shareholders (you) will have receiving an ever increasing
dividend. In the case above an ever increasing dividend is crucial. If your initial yield is 5%, and the dividend
is increased in year 2 to perhaps $ 0.11, then your yield suddenly becomes 5.5% ($ 0.11 / $ 2.00).
OVER TIME, an ever increasing dividend increases your yield….. this is powerful income growth. Your
dividend checks (or in most cases - automatic deposits) just keep growing and growing.

A second interesting thing happens: Companies that have the ability to keep the DTCF ratio in check will
more than likely be capable of increasing their long term earnings, end hence provide shareholders with
capital gains (increased share price). OVER TIME, company WE SPEND CASH INC. will be worth less than company
WE SAVE CASH INC., all other things being equal.

WE SPEND CASH INC. will generate more cash, pay ever increasing dividends, and also have more capital
available to reinvest in the growth of the business.

OUR RATINGS CATEGORY

TIER 1: DTCF is historically decreasing over time while the dividends paid keeps increasing each year.

TIER 2: DTCF is historically constant over time dividends paid keeps increasing each year.

TIER 3: DTCF is historically increasing over time but dividends keep increasing each year.

TIER 4: DTCF is historically increasing over time but dividends keep constant each year.

TIER 5: DTCF is historically increasing over time and dividends falling.

TIER 1 and TIER 2 Ratings will generally offer the best opportunities to keep a growing dividend
as well as share appreciation. TIER 3 companies will require careful monitoring, however companies
with a strong franchise in TIER 3 would still be considered.

TIERS 4 & 5 are probably worth staying away from as the dividend could be at risk.

Dividend Post

JNJ - I Like It !

2008-05-19T11:08:00.002-04:00

Johnson and Johnson is the type of company that compels you to take a closer look
as the financials for this healthcare behemoth are truly outstanding.

Not only does JNJ deliver steady earnings and dividend growth, but it also sports a VERY high
return on equity which bodes well for stellar price appreciation over time.

Look for more details at The Dividend Post - JNJ

Don’t forget to visit The Dividend Post website (www.dividendpost.com) for more ratings and in depth analysis.

A Quick Review

2008-05-19T11:07:00.001-04:00

A QUICK REVIEW OF OUR CURRENT POSITIONS

Altria Group has split itself into two entities.

MO - remains the symbol for the domestic company. Expect steady earnings and dividends from this company.

PM - Phillip Morris International - Nothing really has changed here as we own the same amount of stock as we did before the purchase. We expect to see growth in the international division providing an appreciating share price. We’ll hang on to this one for the long haul (no pun intended).

Anheuser Busch BUD - Current price is $ 49.20

Coverage was initiated at $ 46.50 so we are happy to have this one as well as the steady dividend.

General Electric GE - Current Price $ 32.70 - Coverage Initiated at $ 37.00 so we are happy that we rated this one a Hold at the time.

E I Dupont DD Current Price $ 49.91 Coverage initiated at $ 46.50

DD was rated a Hold at the time so a few dollars have been left on the table, but no worries as there are always plenty of opportunities. We continue to rate DD as a hold

Johnson and Johnson JNJ - Coverage initiated at $ 64.87 Currently $ 67.09

We rated JNJ a BUY so we are pleased with the performance so far, and consider JNJ as one for the long haul.

Stocks rated later in April will be reviewed next month.

Don’t forget to visit The Dividend Post website (www.dividendpost.com) for more ratings and in depth analysis.

KO versus MCD

2008-05-19T11:04:00.002-04:00

I have initiated coverage of both McDonalds Corp as well as The Coca Cola Company. Both are powerhouse brands that pay fairly generous dividends. Please visit http://www.vmwinc.com/DP/ko.htm as well as http://www.vmwinc.com/DP/mcd.htm for more analysis. I will be adding a more detailed discussion of these two stock in my upcoming email blast. Join The Dividend Post mailing The Dividend Post (Top Right Please)

Don’t forget to visit The Dividend Post website (www.dividendpost.com) for more ratings and in depth analysis.

The Shortest Route To a Dividend Cut

2008-05-19T11:01:00.001-04:00

The shortest route to a "dividend cut" would be for any companies' cash flow to start evaporating.
Strong cash flows allow for the two most important factors to dividend investors.

A) The continuation and "growth" of future dividends.

B) The necessary funds to maintain and fund the underlying business.

At The Dividend Post, our criteria for stock selection and ratings rests on the following sound investment principles rated in order of importance:

1) Strong Free Cash Flow to fund future dividends.
2) Dividend Growth to provide a growing income stream over time.
3) Solid business franchise.
4) Strong past performance.
5) A good purchase price to also benefit from increase in share price.

This stock selection service is targeted at the following investment profile:

A) Long term investment time frame (5 years or more)
B) Desire for an additional and growing income stream in the next 5 to 25 years.
C) Risk averse

Currency Exchange Rates

2008-05-19T10:57:00.001-04:00

The Dividend Post research is carried out in Canada with the current focus on US equities. Currency exchange rates can affect your returns over time. Our Canadian research section will be published soon. Canadian investors buying US equities must be mindful of the value of the US dollar, while US investors buying Canadian equities must be mindful of the value of the Canadian dollar.

Right now, the long term trends appear to favor an appreciation of the Canadian dollar. Even Warren Buffett is bullish on the Canadian dollar, and who are we to argue with him. As such, Canadian investors reviewing our data on US stocks must take into consideration the distinct possibility that these equities will be worth less over time when converted back to Canadian funds. Conversely, US investors would be wise to consider Canadian stocks as these will have a currency “kicker” built in when converted back into US funds.

In the time period spanning 2002-2007, the U.S dollar has lost half of its value against the Brazilian Real. Berkshire Hathaway raked in $100 million during 2007 with its holding of the Real since the value of it rose 26% during the past 12 months. Warren Buffett is bullish on the Canadian dollar over the next decade, and we are not going to argue with arguably the greatest living legend of investing.

As a result, US investors would be wise to consider currency for future investments into Canada as the Canadian dollar has very significant potential over the coming decade.

Please visit us at www.dividendpost.com

Dividend Post Research to Date

2008-05-19T10:52:00.000-04:00

Research to date can be located online at the Dividend Post Research Center:

Companies researched to date include:

Abbott Laboratories ABT Coverage Initiated April 7, 2008
Anheuser-Busch BUD Coverage Initiated Feb. 1, 2008
Altria Group MO Coverage Initiated Feb. 2, 2008
Coca Cola Co. KO Coverage Initiated: May 4, 2008
E. I. DuPont DD Coverage Initiated March, 2008
Emerson Electric EMR Coverage Initiated April 11, 2008
General Electric GE Coverage Initiated March 20, 2008
Johnson and Johnson JNJ Coverage initiated: March 31, 2008
McDonalds Corp MCD Coverage Initiated: May 4, 2008

Research to date can be located online at the Dividend Post Research Center:

Dividend Growth !

2008-05-19T10:50:00.001-04:00

“Don’t worry about price fluctuations. All that matters is that the dividend flow is secure and uninterrupted.”

All dividend analysts will follow this by reviewing historical data on dividend paying stocks, ensuring that companies have a consistent record of paying regular dividends, as well as a history of increasing dividends over time. I like this approach which is extremely useful, however I prefer to take things a few steps further. I do this via “cash flow analysis” of the past, as well as present trends.

To grow a business, and dividends, companies require strong cash flows. A business cannot grow dividends without growing the underlying business. Therefore, the business MUST retain sufficient cash to expand operations. Three unique numbers come into play as a result as follows:

a) Net Income
b) Depreciation and Amortization
b) Capital Expenditures

a) Net Income- This is a straightforward calculation of Revenue minus expenses, resulting in the ever popular “earnings per share” (EPS).

b) Depreciation and Amortization - This expense category of is a non cash expense. Companies depreciate assets much like the car you recently purchased. Over time, the assets a company collects lose their vale. The accountants call this depreciation, which really means the assets are “used” and getting older over time. They deduct an amount every year from the revenues to reflect this depreciation, however the company does not disburse any cash for this accounting entry. It is simply that………… an accounting entry or “non cash expense”.

Capital Expenditures - another fancy term in accounting parlance to explain new assets a company must purchase to either replace the used stuff, or keep up with new technologies. In simple terms, when your car gets old, you buy a new one. The catch is that most people don’t factor in depreciation every year as the car grows old. All of a sudden in year 5 or 6, a large disbursement is required for a new car. In the accounting world, this is a capital expenditure. Capital expenditures are cash disbursements and they can be VERY BIG in certain companies.

I determine cash flow as follows:
Net Income + Depreciation and Amortization - Capital Expenditures = Cash Flow.

Note that this is MY interpretation of cash flow and not necessarily the accountants version.

More on this topic at The Dividend Post as http://www.vmwinc.com/DP/dividendpostinvestmentmethodology.htm

General Electric

2008-03-22T13:44:00.002-04:00

My analysis tells me that GE is a safe long term bet for
very conservative investors. The stock appears to be well
poised to perform well in the short term. Over the long
term, I do not see any compelling reasons to own this
company based on the probable low dividend rate
of growth. Other issues will probably offer a higher
degree of income growth over time.

Publicly Traded Partnerships

2008-03-02T16:04:00.002-05:00

Partnership structures operate in many industries both across the USA and around the globe.
Publicly Traded Partnerships now trade around the globe, and provide some very interesting opportunities for investors in the years to come. Please keep visiting The Dividend Post (www.dividendpost.com) and look out for reports on company structures and partnerships. The long term dividend payout looks promising. Keep visiting as there will be lots more to come...!

E. I. DuPont - My Thoughts

2008-03-01T10:59:00.004-05:00

I did some quick numbers on E. I. DuPont ( DD ),
and my analysis provides some insight into why I prefer slow and steady, "predictable"
results. My CHART for E.I. DuPont indicates some erratic numbers
over the last 10 years. As a result of these numbers, it is difficult
to predict, with any confidence, the future direction of owner earnings,
and subsequent ability to keep growing the dividend payment.

Take a look at the online analysis on The Dividend Post

TRENDS CHART for E.I. DuPont

Dividend Growth Chart for E.I. DuPont

Dividend Growth Rates

2008-02-25T05:48:00.002-05:00

At a 20 percent growth rate, your dividend starts at $1.28 a share per year ($64 a year if you have 50 shares) and should grow to $ 2.65 a share in five years. By the time your retire, the growing dividends will provide a nice income, but it's the growth of capital where the real money is. Your capital should grow at the same rate as the dividend, so your $2,500 investment, with any luck, doubles in five years. Think about it, at 20% a year, it has to.
Year 1 $ 1.28 dividend $ 2,500 cost
Year 2 $ 1.54 dividend $ 3,000 price,most likely
Year 3 $ 1.84 dividend by year three, hopefully $ 3,600
Year 4 $ 2.21 dividend $ 4,350 price, if everything proceeds normally
Year 5 $ 2.65 dividend $ 5,230 ...with any luck...just about a double

Now you are earning close to 40% return on your initial investment.

2008-02-24T12:16:00.003-05:00

Capital appreciation is not the sole source of investment returns: Where you can find it, income can be just as or even more important. The combination of capital growth and income is what constitutes total return, and this is what the investor should seek to maximize. Look at it this way: If you can get 10% annual capital appreciation from a stock that pays no dividend, or a 5% yield with 5% annual growth, which will leave you better off? On a pretax basis, the total
returns offered by these two stocks are identical.

Canadian Investors - Sin stock worth consideration

Rothmans Inc. (ROC-TSX)
Nov. 19 price: $24.95
Dividend: $1.40
Yield: 5.7 per cent

Toronto-based Rothmans, which makes Rothmans, Craven A and Benson & Hedges
brand cigarettes, provides investors with a high yield and has risen its dividend an average
of about 11 per cent annually over the past five years.

While its dividend hadn’t been touched since 2005, Rothmans announced a dividend raise of 16 per cent from $1.20 following a strong second-quarter earnings report on Oct. 26.

Just a few brief notes before diving right into the first companies profiled:

Dividends are not just for retirees--they're for anyone and everyone of all ages interested in earning high total returns over long periods of time.

I am a huge fan of dividends. I like seeing large sums of cash automatically deposited into my brokerage account every quarter. I like knowing that the businesses I own are generating real cash flow and sharing it directly with shareholders like me. I prefer to control my destiny and leave the mutual fund managers out of the equations. The management expense ratio will cost tens of thousands, if not hundreds of thousands of dollars at the end of the day. Think long term.

This isn't to say that growth through capital appreciation is off my radar. My personal
portfolio contains several small growth oriented companies that most people would not have heard
of. These are certainly not profiled here (unless I can locate one paying you a great dividend).

True tax must be considered. For most, the income received in tax deferred retirement accounts.

The dividend growth strategy required very little time, a few minutes a month...perhaps.
You are going to have to do it on your own, but it will be worth it. Temperament is key, and
the downfall of most investors who yearn to look at their portfolio daily and trade
in and out of stocks. RESIST the temptation and join the rest of us who receive our paychecks
via dividends.

At the bottom of each monthly report, you will find a scorecard. The number of interest is the
YIELD ON PURCHASE PRICE TODAY, i.e. your effective yield given the original purchase price.
This percentage will increase over time as the dividend payments increase, and conversely
decrease over time if dividend payments are cut.

Dividend Growth Criteria

2008-02-24T11:47:00.005-05:00

THE THREE MOST IMPORTANT NUMBERS
FOR DIVIDEND GROWTH

1) Net Income

2) Depreciation and Amortization

3) Capital Expenditures

Dividend To Cash Flow Ratio

I like to refer to this as the DTCF Ratio

Accounting rules require companies to disclose their financial statements and the three numbers that
interest dividend investors (according to me would be as follows:

Net income (or alternatively Net Income Per Share) is equal to all revenues minus all expenses

Depreciation and Amortization

Capital Expenditures

Now for a "very brief" explanation:

Depreciation and Amortization is an expense category:

This expense category of is a non cash expense. Companies depreciate assets much like
the car you recently purchased. Over time, the assets a company collects lose their vale.
The accountants call this depreciation, which really means the assets are "used" and getting older over time. They deduct and amount every year from the revenues to reflect this depreciation, however the company does not disburse any cash for this accounting entry. It is simply that, an accounting entry.

Capital Expenditures - another fancy term in accounting parlance to explain new assets a company must purchase to either replace the used stuff, or keep up with new technologies. In simple terms, when your car gets old, you buy a new one. This is a capital expenditure in accounting terms. Capital expenditures are cash disbursements and can be VERY BIG
in certain companies.

Here are two simple examples:

Company WE SPEND CASH INC. in year 1:

Net Income in year 1= $ 0.90
Depreciation in year 1 = $ 0.50

Total cash flow available to shareholders n year 1: $ 1.40

Capital expenditures in year 1: $ 0.55

Cash Flow available for shareholders: $ 0.90 + $ 0.50 - $ 0.55 = $ 0.85

Dividend: $ 0.10

Dividend / Cash Flow

$ 0.10 / $ 0.85 = 15 percent

15 percent of the cash flow is used to pay dividends.

Company "WE SAVE CASH INC." in year 1:

Net Income in year 1= $ 0.90
Depreciation in year 1 = $ 0.50

Total cash flow available to shareholders: $ 1.40

Capital expenditures in year 1: $ 0.40

Cash Flow available for shareholders in year 1: $ 0.90 + $ .50 - $ 0.40 = $ 1.00

Dividend / Cash Flow

Dividend: $ .10

$ 0.10 / $ 1.00 = 10 percent

In this case, company XYZ is paying out 10 percent of their cash flow as dividends.

On the surface it would appear that 15 percent is better than 10 percent, but in this case,
that is not true. And the reason is very simple...... Company We Need Cash Inc. requires more money
to fund capital expenditures than company WE SAVE CASH INC. Company WE SAVE CASH INC. earns the same as company
WE SPEND CASH INC., but requires less capital. The result is that company WE SAVE CASH INC. will have an easier time
paying dividends, and an easier time "INCREASING" dividends, over time.

Let's assume both shares trade for $ 2.00 per share.
The Dividend Yield for both companies = $ 0.10 / $ 2.00 = 5 %
Consider the yield of 5% as the equivalent of an interest payment.

OVER TIME the company that can keep their dividend to cash flow ratio, as described above,
consistent or "LOWER", the better chance shareholders (you) will have receiving an ever increasing
dividend. In the case above an ever increasing dividend is crucial. If your initial yield is 5%, and the dividend
is increased in year 2 to perhaps $ 0.11, then your yield suddenly becomes 5.5% ($ 0.11 / $ 2.00).
OVER TIME, an ever increasing dividend increases your yield..... this is powerful income growth. Your
dividend checks (or in most cases - automatic deposits) just keep growing and growing.

A second interesting thing happens: Companies that have the ability to keep the DTCF ratio in check will more than likely be capable of increasing their long term earnings, end hence provide shareholders with capital gains (increased share price). OVER TIME, company WE SPEND CASH INC. will be worth less than company WE SAVE CASH INC., all other things being equal.

WE SPEND CASH INC. will generate more cash, pay ever increasing dividends, and also have more capital available to reinvest in the growth of the business.

OUR RATINGS CATEGORY

TIER 1: DTCF is historically decreasing over time while the dividends paid keeps increasing each year.

TIER 2: DTCF is historically constant over time dividends paid keeps increasing each year.

TIER 3: DTCF is historically increasing over time but dividends keep increasing each year.

TIER 4: DTCF is historically increasing over time but dividends keep constant each year.

TIER 5: DTCF is historically increasing over time and dividends falling.

TIER 1 and TIER 2 Ratings will generally offer the best opportunities to keep a growing dividend
as well as share appreciation. TIER 3 companies will require careful monitoring, however companies
with a strong franchise in TIER 3 would still be considered.

TIERS 4 & 5 are probably worth staying away from as the dividend could be at risk.