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Best Dividend Stocks
Ex-Dividend Dates
High Yield Stocks

utility company image


Record Profits and Smart M&A Moves Help Utility Giant Strengthen Position on Best Dividend Stocks List

Aaron Levitt Apr 24, 2019

If you’ve been in, or currently are in, any branch of the military, you’re probably familiar with the acronym KISS. That would be: “Keep It Simple, Stupid.” These days, a variety of corporations have been applying KISS to their operations in order to tone down complexity, streamline business models and, ultimately, boost returns. The days of the sprawling conglomerate are over. KISS can truly do wonders for a firm’s bottom line. So, applying the principal to an already simple business that throws off tons of cash is a very good thing indeed.

And that’s just what our Best Dividend Stocks List’s pick in the utility sector is doing.

Our pick has a wide moat of natural gas distribution, midstream assets and electricity generation assets. This includes one of the largest propane distribution businesses in the country. Unfortunately, that asset was tucked away in a master limited partnership (MLP). With MLPs becoming a huge burden over the last decade or so, our pick is smartly buying up the rest of this business from its unitholders and tucking it away under the rest of its umbrella. The best part is that it is doing so at a huge discount in order to generate cash flows and unlock value.

See the original article on our pick here.

The deal will only boost our pick’s already clockwork-like/stable profits. And given its long history of returning those profits to investors as hefty dividend growth and buybacks, investors should continue to enjoy the rewards of this smart business decision. In the end, our pick continues to make all the right moves for dividend investors.

To summarize, here are five reasons why you should own this stock:

  1. Has paid common dividends for 130+ consecutive years and has increased its dividends annually for more than 30 years.
  2. Reported record full-year 2018 profits – the third consecutive year of breaking its previous year’s record.
  3. Has smartly used M&A, buyouts and mergers to build-out a huge distribution network and create a vast regional monopoly.
  4. Multinational utility with overseas operations in 17 countries.
  5. Healthy payout ratio of less than 38% and growing yield of 1.98%.

Our Best Dividend Stocks List has 20 of the highest-rated stocks by our proprietary rating system. Go Premium to find out the entire list.

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