Two New Dividend Investing Articles

In the past week, I posted two new articles on Seeking Alpha. They both may be of interest to dividend investors.

In "The Highest Yielding Dividend Champions by Cap Size," I used a table to position all of the Dividend Champions, Challengers, and Contenders according to their market capitalizations. Surprisingly, nearly half the stocks were small-caps. Most people automatically assume that dividend-paying stocks are those of huge companies like Coca-Cola or GE. But there are many good smaller companies that pay dividends too.

For those who are not familiar with Dividend Champions, Challengers, and Contenders, they are stocks that have increased their dividends every year for 25, 10, and 5 years, respectively. There is a link in the article to that source document, which is updated monthly and is one of the best research tools for dividend investors.

"Do Dividend Increases Keep Up with Inflation?," just published this morning, illustrates that in the aggregate, dividend increases grow faster than inflation in most years. In the aggregate over many years, they crush inflation by a factor of around 1.7-to-1. The article is based on data from S&P about stocks in its S&P 500 index. The real picture is even better than shown in the article, because the S&P 500 is not a good proxy for a good dividend-growth portfolio--more than 100 of its stocks do not even pay dividends. So if the S&P 500's stocks' dividends grow faster than inflation, a serious dividend-growth portfoli will do even better.