Nucor (NYSE: NUE) & The Golden Dividend Ratio

There has been a lot of talk about value traps recently. With dozens of companies slashing or halting their dividends, many income investors have seen a “double whammy” of lower portfolio values and lower revenues.

And while it’s real easy to find losers, the dividend winners are much harder to find.

Seven that Money Magazine looked at include 3M (NYSE: MMM), Johnson & Johnson (NYSE: JNJ), PepsiCo (NYSE: PEP), Emerson Electric (NYSE: EMR), Nucor (NYSE: NUE), Dover (NYSE: DOV) and Clorox (NYSE: CLX).

These dividend stocks all have something interesting in common – in addition to the fact they’re each raised dividends for at least 25 years. It’s their yield.

The yields on these companies range from 3.1% to 3.8%. Consider it the “golden ratio” of dividends. It laymen’s terms, it’s the amount a company can comfortably pay out while still keeping enough for reinvestment and growth.

Looking at the growth rate of their stocks, the worst performer, 3M, has only returned a 447.1% return over the last 25 years. It’s annualized return of 17.88% still beats the S&P’s (.INX) 16.36%. The best performer from that group, Nucor, has an annualized return of 100.25%.

It should give investors pause about investing only in the highest yielding stocks.

Companies mentioned in this article: MMM, JNJ, PEP, EMR, NUE, DOV and CLX.

• Dividend-Paying Stocks: 5 Pharmaceutical “Cash Machines”
• Stock Dividends: The Difference Between Success and Failure
• Investing In Dividend-Paying Stocks: A “Strong Buy” Since 1935

Sign Up now and receive this Free report: Collect 122% in the Next 12 Months From Gold's Surge.

Could you use an extra $600 - or more - each month?

If so, you’ll want to check out the details of an overlooked government-backed program in THIS REPORT.

It shows you why the government is set to distribute $457 million to a small group of recipients, how to get your name on the list and the exact deadline you must meet in order to qualify.

Comments

Check out our selection of daily Investment Research:

We Respect Your Privacy

---

What is Investment U?

Since 1999, Investment U has provided impartial, no-nonsense investment advice on how to build long-lasting wealth.

---

Recent Articles

Platinum Services

The Oxford Club is an exclusive, global network of investors, who collectively participate in the pursuit of prosperity and wealth. The Club is renowned for its market-beating, tried-and-true investment principles.

The White Cap Report exclusively identifies companies, White Caps, which - by being among the earliest to gain traction - have secured dominant positions within untapped, billion-dollar markets.

With an elite trading team at the helm, the Xcelerated Profits Report shows any investor how to "invest like a pro," using high-level, yet easy-to-execute strategies that "xcelerate" profits while minimizing risk.

---