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Recent Articles
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Dividend Growth Newsletter Portfolio Holding Dick’s Sporting Goods Doubles Dividend, Shares Soar!
Mar 7, 2023
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Image Source: Dick’s Sporting Goods’ shares are breaking out of a very nice technical cup-and-handle pattern, and we continue to like shares as an idea in the Dividend Growth Newsletter portfolio. Image: TradingView.
We include Dick’s Sporting Goods as an idea in the Dividend Growth Newsletter portfolio. On March 7, the company reported its fourth-quarter results for the three months ended January 28, 2023. Comparable store sales growth in the quarter came in at 5.3%, which was more than double that which consensus was looking for. The executive team also more than doubled its dividend (105%+), to $4.00 per share on an annualized basis, resulting in a ~2.8% forward estimated dividend yield on the basis of where shares are trading of late. We’re reiterating our $163 per-share fair value estimate of shares, and we continue to like them in the Dividend Growth Newsletter portfolio. We expect to update our dividend report shortly.
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Markets Bounce Off Technical Support But Not Out of the Woods
Mar 6, 2023
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Image: The market-cap weighted S&P 500 (SPY) bounced off technical support last week, both the 200-day moving average as well as the breakout of the downtrend line, but while this may push off any leg down in the near term, we won’t hesitate to “raise cash” on a few newsletter portfolio names if a breakthrough of support to the downside happens. Image Source: TradingView.
The 200-day moving average remains a key technical level for the market-cap weighted S&P 500. The risks that the market may break through both the 200-day moving average and the breakout of the technical downtrend line remain elevated, but the past week showed a successful test of technical support levels, in our view, and that means to us markets may avoid any substantial leg down for the time being. We continue to be cautious on the equity markets in the near term, and we won’t hesitate to “raise cash” across the newsletter portfolios if the S&P 500 breaks through its 200-day moving average and the breakout of the technical downtrend line.
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Update: J&J Reports Messy Q4, Free Cash Flow Remains Robust But Looming Kenvue Split Adds Uncertainty
Mar 3, 2023
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Image: Johnson & Johnson’s free cash flow generation remains far in excess of its cash dividends paid. Image Source: J&J.
Johnson & Johnson reported messy fourth-quarter 2022 results that showed a large difference between GAAP and non-GAAP reporting. The company’s free cash flow presentation wasn’t great either, and we can’t help but feel management is a bit distracted given that the firm is working to spin off its Consumer Health division (Kenvue) later during 2023. J&J will retain its two larger divisions, Pharma and MedTech, including its key drugs Stelara, Darzalek, Tremfya, Erleada, and Uptravi, as well as its MedTech operations that have exposure to a number of areas including electrophysiology, wound closure, procedures for knees and hips, as well as surgical vision and trauma. We continue to like J&J’s coverage of the dividend with free cash flow, but we doubt the company will stay in the newsletter portfolios for much longer in light of the messy presentation and impending Kenvue split, expected in November 2023. We like to keep things simple. Shares yield ~2.7%. [We have updated this work to reflect that we are considering removing JNJ from both the Dividend Growth Newsletter portfolio and the Best Ideas Newsletter portfolio.]
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Dividend Increases/Decreases for the Week of March 3
Mar 3, 2023
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Let's take a look at firms raising/lowering their dividends this week.
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