Family Dollar Stores, Inc. (FDO) operates a chain of self-service retail discount stores primarily for low and middle income consumers in the United States. This dividend aristocrat has paid uninterrupted dividends on its common stock since for 36 years in a row.
The company’s last dividend increase was in January 2012 when the Board of Directors approved a 16.70% increase to 21 cents/share. Family Dollar‘s largest competitors include Target (TGT), Dollar Tree (DLTR) and Big Lots (BIG).
Over the past decade this dividend growth stock has delivered an annualized total return of 8.20% to its shareholders.
dividend payment doubling every six years. If we look at historical data, going as far back as 1988 we see that Family Dollar has managed to double its dividend every six years on average. Over the past decade, the dividend payout ratio has remained steady between 20% and 30%. A lower payout is always a plus, since it leaves room for consistent dividend growth minimizing the impact of short-term fluctuations in earnings.
is overvalued at 20 times earnings and yielding 1.20%. I would keep a close eye on the stock however, and would consider adding to my position on dips below $40/share.
Full Disclosure: Long FDO
- Avoid Cyclical Dividend Growth Stocks
- My Dividend Retirement Plan
- Dividend Aristocrats List for 2012
- Dividend Growth Stocks by Sector - Retail
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