The Bartis Dividend Growth Portfolio
Dividend Growers Model Portfolio is a list of 24 stocks that meet our criteria to qualify has a high-quality dividend growth stock.
We do not look for stocks that pay big dividends for income here, rather the focus is still on capital growth, but a lot of research has shown if you want total return then stocks that grow their dividends is a great place to start.
According to research, from January 1972 to June 2019, stocks in the S&P500 that have been able to grow their dividends has vastly outperformed those that do not pay dividends. To be able to pay a dividend, generally a company must have a strong balance sheet, consistent cash flow and excess available cash.
These attributes also make them great investments regardless of their dividend. Investors are always searching for great investments and hence their fundamental characteristics attract all investors which tends to cause their stock price to rise.
With Dividend Paying stocks you get the best of both worlds. Not only can you experience significant capital price appreciation, but you also get an income stream and if you add that income stream back into your returns the outperformance is significant.
All of this research points to the same thing – dividends matter and can make a significant difference to your overall returns.
Had you invested $100,000 in non-dividend paying stocks 40 years ago, your portfolio would be worth $299,464 now.
However, if you had invested that $100,000 in the dividend growers 40 years ago, your portfolio would be worth $4,364,230 now.
That is a significant difference and why we think the dividend growth list is a great place to start looking for your next investment.