Dividends are hot right now, providing investors greater stability in unstable times. After reviewing the recent dividend increases in the food industry, I figured it would be a great time to investigate a few beverage companies as well. According to CNNMoney, alcoholic beverage sales grew by almost 10% over the last 12 months, so we'll skip the soda and juice for now and dive straight into adult beverages.
Foreign affairs
Liquor giant Diageo
Company |
TTM Dividend Yield |
5-Year % Increase |
---|---|---|
Diageo |
2.9% |
5.3% |
Brown-Forman |
1.7% |
8.1% |
Source: Yahoo! Finance.
Diageo has a great dividend yield and a solid history of increases behind it. Competitor Brown-Forman has been ramping up its dividend, but a 1.7% yield is not quite high enough to get me interested right now.
Dividends in a can
As much as I love to wax poetic on all things craft beer, it is not the stuff that dividend dreams are made of. For great beer dividends, you have to look to the larger players. Anheuser Busch InBev
Company |
TTM Dividend Yield |
5-Year % Increase |
---|---|---|
Anheuser Busch InBev |
2.0% |
10.8% |
Molson Coors |
2.8% |
11.8% |
United Breweries |
3.7% |
8.7% |
Source: Yahoo! Finance.
Molson Coors looks great, with a dividend yield just shy of 3% and impressive increases. The real star here, though, is United Breweries -- also known as Compania Cervecerias Unidas -- a beverage midcap based in Santiago, Chile. Its dividend yield is the highest of all the companies listed here, and it has increased its dividend nicely since 2006.
Toss the empties
Analyzing the trailing-12-month dividend yield and dividend history for a handful of companies is a great way to screen potential investments. Once you have narrowed your group to a few standouts, make sure to check out a few more metrics such as interest coverage and free cash flow payout ratios. And remember, never underestimate the impact of your company's management on your dividends.
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