The J. M. Smucker Company (SJM) engages in manufacturing and marketing branded food products primarily in the United States, Canada, and internationally. The company is a member of the dividend achievers index, and has boosted distributions for fifteen years in a row. The company’s last dividend increase was in July 2012 when the Board of Directors approved an 8.30% increase to 52 cents/share. The company’s largest competitors include Conagra (CAG), Kraft (KFT) and Hershey (HSY). Over the past decade this dividend growth stock has delivered an annualized total return of 11.60% to its shareholders.
dividend payment has increased by 11.10% per year over the past decade, which is much higher than the growth in EPS. This was achieved mainly through the expansion in the dividend payout ratio.
dividend payment doubling almost every six and a half years. If we look at historical data, going as far back as 1997 we see that J. M. Smucker has actually managed to double its dividend every seven and a half years on average. The dividend payout ratio has increased from 37.60% in 2003 to 46% in 2012. 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 slightly overvalued, trading at 21.10 times earnings and yielding 2.40%. I would consider adding to my position in the stock on dips below 81.50/share.
Full Disclosure: Long PG
- Dividend Achievers Offer Income Growth and Capital Appreciation
- Eight Income Stocks Boosting Investor Returns
- How to get dividend investment ideas
- McCormick & Company (MKC) Dividend Stock Analysis 2011.
This article was written by Dividend Growth Investor. If you enjoyed this article, please subscribe to my feed [RSS], or have future articles emailed to you [Email] or follow me on Twitter [Twitter].