Dividend Champion Portfolio – May Update

The High Yield Dividend Champion Portfolio is a publicly tracked stock portfolio on Scott’s Investments.  Its goal is to capture quality high yield stocks with a history of raising dividends.

The screening process for this portfolio starts with the “Dividend Champions” as compiled by DRIP Investing. The list is comprised of stocks that have increased their dividend payout for at least 25 consecutive years.

I made one change to the screen methodology for 2016 in order to further simplify the process. Stocks from the Dividend Champion list were previously ranked on yield, payout ratio, P/E, and 3 year dividend growth rate.

In 2016 stocks are ranked on yield, P/E and 3 year dividend growth rate.  Payout ratio will no longer be a factor.  The modification has a relatively low impact to screen results.

Stocks will still be sold on the re-balance date (generally around the 5th of the month) when they drop out of the top 15 (to limit turnover) and are replaced with the next highest rated stock.

The top 25 stocks using the new method  are below and displayed in order of their overall ranking (figures are April month-end):

Name Symbol Yield P/E 3-yr
Helmerich & Payne Inc. HP 4.16 30.75 114.15
AT&T Inc. T 4.95 17.18 2.22
Emerson Electric EMR 3.48 14.57 5.40
Altria Group Inc. MO 3.60 23.49 8.36
Old Republic International ORI 4.06 12.66 1.39
Questar Corp. STR 3.51 21.25 8.10
Archer Daniels Midland ADM 3.00 13.36 16.96
Eagle Financial Services EFSI 3.43 11.83 3.10
Eaton Vance Corp. EV 3.07 15.70 9.18
Universal Corp. UVV 3.89 15.63 2.00
ExxonMobil Corp. XOM 3.39 22.96 9.73
Chevron Corp. CVX 4.19 41.71 6.83
Community Trust Banc. CTBI 3.46 13.33 2.25
Wal-Mart Stores Inc. WMT 2.99 14.63 7.78
HCP Inc. HCP 6.80 999.00 4.16
Consolidated Edison ED 3.59 18.37 2.42
T. Rowe Price Group TROW 2.87 16.16 15.21
Target Corp. TGT 2.82 15.06 17.84
MDU Resources MDU 3.74 26.05 2.90
Bowl America Class A BWL-A 4.74 31.22 1.78
Universal Health Realty Trust UHT 4.73 30.67 1.47
Sonoco Products Co. SON 3.16 19.22 4.81
National Retail Properties NNN 3.98 38.73 3.11
Coca-Cola Company KO 3.13 26.99 8.97
Procter & Gamble Co. PG 3.34 26.44 5.99

There is  turnover in one position for May.  T Rowe Price Group (TROW) will be sold for a gain of 3.49% and replaced with Questar (STR).

The current portfolio is below:

Position Shares Average Purchase Price Initial Purchase Date Percentage Gain/Loss Excluding Dividends
CVX 218 103.1835 12/6/2012 -1.27%
EMR 425 49.64 8/4/2015 7.37%
ORI 1145 16.22 4/4/2014 15.66%
EV 700 28.38 2/5/2016 20.33%
ADM 690 35.41 12/7/2015 7.88%
MO 400 58.14 1/7/2016 8.20%
XOM 196 89.01 4/5/2013 -0.58%
HP 258 87.4457 10/6/2014 -30.60%
STR 1075 25.03 5/6/2016 0.00%
T 650 38.13 3/7/2016 2.23%

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