I'd be very hesitant about Methode Electronics ($MEI). 🤔
The dividend record has been impressive. Seeking Alpha shows a steadily growing dividend ever since 1990. 📈
However, past financials are lumpy. Net income experienced a surge from 2015 only to collapse this past year. Free Cash Flow is just as lumpy too. Total returns for the past 10 years with dividends reinvested is -69.60%. It looks like the company has a new CEO in place and they are on a journey to transform the business. I would encourage everyone to visit the company's website and check out the latest earnings presentation. Maybe we will see a new Methode Electronics in a few years? 🤷
T. Rowe Price ($TROW) has been in funk for a while so the dividend yield is nice. The company is cash rich with steady revenues and decent cash flows. The dividend is very secure. 💪
Chevron ($CVX) suffers from the cyclical hydrocarbon boom and bust cycle (especially when weather and politics put their thumbs on the scale!) but is an essential player in the energy space. Debt levels are manageable. This is another dividend that is very secure. 💪
Unfortunately, these companies are not ones that will make you rich. They will help keep you rich in the long run though. 💰 Add a few companies like Reality Income ($O) and United Parcel Service ($UPS), a couple of bonds for stability, and cash in a money market account to get you through a rainy day and you will be just fine with your income fund. You can add some juice to your portfolio with one or two closed end funds like Reaves Utility Income Trust ($UTG) or BlackRock Utilities, Infrastructure, & Power Opportunities Trust ($BUI). 🧃
I should point out that the companies in the article were only meant to show the difference between a high initial yield with lower growth versus a lower initial yield with faster growth over time.
I'd be very hesitant about Methode Electronics ($MEI). 🤔
The dividend record has been impressive. Seeking Alpha shows a steadily growing dividend ever since 1990. 📈
However, past financials are lumpy. Net income experienced a surge from 2015 only to collapse this past year. Free Cash Flow is just as lumpy too. Total returns for the past 10 years with dividends reinvested is -69.60%. It looks like the company has a new CEO in place and they are on a journey to transform the business. I would encourage everyone to visit the company's website and check out the latest earnings presentation. Maybe we will see a new Methode Electronics in a few years? 🤷
T. Rowe Price ($TROW) has been in funk for a while so the dividend yield is nice. The company is cash rich with steady revenues and decent cash flows. The dividend is very secure. 💪
Chevron ($CVX) suffers from the cyclical hydrocarbon boom and bust cycle (especially when weather and politics put their thumbs on the scale!) but is an essential player in the energy space. Debt levels are manageable. This is another dividend that is very secure. 💪
Unfortunately, these companies are not ones that will make you rich. They will help keep you rich in the long run though. 💰 Add a few companies like Reality Income ($O) and United Parcel Service ($UPS), a couple of bonds for stability, and cash in a money market account to get you through a rainy day and you will be just fine with your income fund. You can add some juice to your portfolio with one or two closed end funds like Reaves Utility Income Trust ($UTG) or BlackRock Utilities, Infrastructure, & Power Opportunities Trust ($BUI). 🧃
Always appreciate you sharing your wisdom!
I should point out that the companies in the article were only meant to show the difference between a high initial yield with lower growth versus a lower initial yield with faster growth over time.
Nice article as always
Thanks for the kind words!
good stuff!
Glad you liked it!
Great idea , only not voor Belguim resident . Almost 50 % tax for foreign dividend .