An off-price retailer sitting near the top of its industry has quietly grown its dividend at a 13% three-year compound annual rate, a pace that lands in the top 20% of every dividend-paying stock we track.
The business model is simple to follow. Buy up excess inventory from other retailers and brands, then resell it to value-conscious shoppers at a discount, across thousands of stores spread over several countries. Recent results were mixed but mostly encouraging. Several divisions posted mid-single-digit growth in sales at existing stores, while the company’s largest division worked through a self-described merchandise mix problem that management expects to resolve by the holidays. Rising freight costs and unresolved tariff refunds add some uncertainty to the months ahead, though the balance sheet carries a debt load that is well below what similar companies typically hold.
This stock has just been added to the Dividend Growth Stocks Portfolio. The combination of a rare dividend growth rate, a conservative balance sheet, and a management team actively expanding the store footprint fits the portfolio’s mandate of finding companies that can keep raising their payout for years to come.
