Vice stocks have long been among the best consumer plays for those seeking dividends. Featuring strong cash flows and high margins, many firms operating within the vice sector continue to support their shareholders well. After all, when you’re selling “fun,” consumers keep coming back no matter the economic environment. Our latest Best Dividend Capture Stocks List pick is one of those firms, with a strong dividend growth history of nearly two decades!
You can check out the Best Dividend Capture Stocks List to explore all the stocks.
Our pick is one of the largest tobacco manufacturers in the world. While rates of smoking and tobacco use continue to be mixed here in the U.S — cigarette smoking rates have decreased, while e-cigarette use has increased — internationally, tobacco use is on the rise. This is particularly true in emerging markets. With sales in over 180 different countries, our pick’s global focus has served it well since its foundation.
Aside from the sheer growth and size of the global tobacco market, our pick has managed to find other ways to improve its sales and margins.
This includes new smokeless tobacco products. Offering an alternative to traditional cigarettes, these products have provided our pick with a new growth avenue here in the U.S. Moreover, e-cigarette sales continue to grow, while the firm’s other businesses and investment portfolios, including a hefty dose of medical devices, have strongly contributed to its bottom line. This has allowed it to reward its shareholders over the long haul.
The end result is that our pick’s steady cash flows, high yield, and growth profile have made our pick a wonderful dividend capture play. A dividend capture strategy involves buying a stock before its ex-dividend date and then selling it after it has recovered the payout. With an ex-dividend date of Thursday, March 20, our pick is primed for the strategy, as is evident from its historical track record of a recovery period within an average of 11.3 days after going ex-dividend.
For investors looking for a quick total return of income and capital appreciation, our latest tobacco play could be a lucrative option.
