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7 Dividend Growth Stocks For February 2022

These high-yielding Dividend Radar stocks are undervalued, yield at least 4%, and have 5-year dividend growth rates of 6% or higher.

Welcome to another edition of my monthly 7 Dividend Growth Stocks series! Every month, I present seven dividend growth stocks from my watch list for further analysis and possible investment. I use different screens every month to highlight specific elements of dividend growth [DG] investing. This month, income investors will find some high-yielding candidates worth consideration.

I screened for discounted DG stocks in Dividend Radar yielding at least 4% and a 5-year dividend growth rate of 6% or higher. I also screened for DG stocks with dividend increase streaks of 10 or more years.

and my to rank candidates and present the seven top-ranked stocks in this article.

In case you missed previous articles in this series, here are links to them:

Screening and Ranking

For this month’s article, I used the following screens:

  • Investment Grade stocks (DVK Quality Scores of 15-25)
  • Dividend Increase Streak of at least ten years
  • Forward Dividend Yield is at least 4.0%
  • 5-Year Dividend Growth Rate is at least 6.0%
  • Discounted relative to my fair value [FV] estimate
, , and . Additionally, I using each stock’s five-year average dividend yield. With up to eleven estimates and targets available, I ignore the outliers (the lowest and highest values) and use the average of the median and mean of the remaining values as my FV estimate.

(dated January 28, 2022) contains 717 DG stocks. Of these, 338 stocks are Investment Grade, 268 stocks have dividend increase streaks of ten or more years, 80 stocks yield at least 4%, 524 stocks have 5-year dividend growth rates of 6% or higher, and ​​407 stocks are discounted. Exactly seven stocks pass all four screens.

'
  • Forward Dividend Yield
  • 7 Top-Ranked Dividend Growth Stocks for February

    Here are top-ranked dividend growth stocks that passed this month’s screens:

    Screen Shot 2022-02-03 at 9.45.35 AM

    I own three of these stocks in my DivGro portfolio.

    quality score
  • Fwd Yield: forward dividend yield for a recent share Price
  • 5-Avg Yield: 5-year average dividend yield
  • 5-DGR: 5-year compound annual growth rate of the dividend
  • 5-YOC: the projected yield on cost after five years of investment
  • C#: , a popular metric for screening dividend growth stocks
  • 5-TTR: 5-year compound trailing total returns
  • VL Safety Rank: 's
  • VL Fin Stren: Value Line's ratings
  • MS Econ Moat: 's
  • S&P Cred Rating: 's
  • SSD Divi Safety: '
  • Buy Below: my risk-adjusted buy below price
  • –Disc +Prem: discount or premium of the recent share Price to my Buy Below price
  • Price: recent share price
  • My risk-adjusted Buy Below prices allow premium valuations for the highest-quality stocks but require discounted valuations for lower-quality stocks.

    The Fwd Yield column is colored green if Fwd Yield ≥ 5-Avg Yield.

    Key metrics and fair value estimates of February’s Top 7 Dividend Growth Stocks (includes data sourced from Dividend Radar).

    Key metrics and fair value estimates of February’s Top 7 Dividend Growth Stocks (includes data sourced from Dividend Radar).

    Next, let's look at each stock in turn. All data and charts are courtesy of .

    AbbVie Inc (ABBV)

    ABBV is a worldwide, research-based biopharmaceutical company that develops and markets products to treat conditions such as rheumatoid arthritis, psoriasis, and Crohn's disease; hepatitis C; human immunodeficiency virus; endometriosis; thyroid disease; Parkinson's disease; and chronic kidney disease and cystic fibrosis. ABBV was incorporated in 2012 and is based in North Chicago, Illinois.

    Screen Shot 2022-02-03 at 9.50.09 AM
    ABBV non-GAAP EPS and dividends paid (TTM), with stock price overlay

    ABBV non-GAAP EPS and dividends paid (TTM), with stock price overlay

    OGE Energy Corp (OGE)

    Founded in 1995, OGE, together with its subsidiaries, provides energy and energy services primarily in the south-central United States. The company operates in two segments, Electric Utility and Natural Gas Midstream Operations. It offers physical delivery and related services for both electricity and natural gas. OGE is headquartered in Oklahoma City, Oklahoma.

    Screen Shot 2022-02-03 at 9.54.12 AM
    OGE non-GAAP EPS and dividends paid (TTM), with stock price overlay

    OGE non-GAAP EPS and dividends paid (TTM), with stock price overlay

    Enbridge Inc (ENB)

    Founded in 1949 and headquartered in Calgary, Canada, ENB is an energy transportation and distribution company with operations in the United States, Canada, and internationally. The company operates the world's longest crude oil and liquids pipeline system. ENB owns and operates Canada's largest natural gas distribution company.

    Screen Shot 2022-02-03 at 9.55.56 AM
    ENB non-GAAP EPS and dividends paid (TTM), with stock price overlay

    ENB non-GAAP EPS and dividends paid (TTM), with stock price overlay

    Altria Group, Inc (MO)

    MO was founded in 1919 and is headquartered in Richmond, Virginia. The company manufactures and sells cigarettes, smokeless products, and wine in the United States. In March 2008, MO spun off the subsidiary Phillip Morris to protect it from litigation in the United States.

    Screen Shot 2022-02-03 at 9.57.35 AM
    MO non-GAAP EPS and dividends paid (TTM), with stock price overlay

    MO non-GAAP EPS and dividends paid (TTM), with stock price overlay

    Prudential Financial, Inc (PRU)

    PRU is a financial services company, which, through its subsidiaries and affiliates, provides a range of financial products and services, including life insurance, annuities, retirement-related services, mutual funds and investment management. The company has more than $1 trillion of assets under management. PRU was founded in 1875 and is headquartered in Newark, New Jersey.

    Screen Shot 2022-02-03 at 9.59.08 AM
    PRU non-GAAP EPS and dividends paid (TTM), with stock price overlay

    PRU non-GAAP EPS and dividends paid (TTM), with stock price overlay

    Edison International (EIX)

    EIX is the parent company of Southern California Edison. The company generates and distributes electricity and provides energy services and technologies, including renewable energy, in the United States. The company generates electricity from hydroelectric, diesel, natural gas, nuclear, and photovoltaic sources. EIX was incorporated in 1987 and is based in Rosemead, California.

    Screen Shot 2022-02-03 at 10.01.09 AM
    EIX non-GAAP EPS and dividends paid (TTM), with stock price overlay

    EIX non-GAAP EPS and dividends paid (TTM), with stock price overlay

    MPLX LP (MPLX)

    Founded in 2012 and based in Findlay, Ohio, MPLX is a master limited partnership that owns, operates, develops, and acquires midstream energy infrastructure assets. MPLX gathers, processes, and transports natural gas. The company also gathers, transports, stores, and markets natural gas liquids, crude oil, and refined petroleum products.

    Screen Shot 2022-02-03 at 10.02.44 AM
    MPLX non-GAAP EPS and dividends paid (TTM), with stock price overlay

    MPLX non-GAAP EPS and dividends paid (TTM), with stock price overlay

    Concluding Remarks

    Screen Shot 2022-02-03 at 10.13.05 AM

    This month, I screened for discounted DG stocks in Dividend Radar yielding at least 4% and with 5-year dividend growth rates of 6% or higher. I also screened for DG stocks with dividend increase streaks of 10 or more years.

    I’m long three of this month’s candidates, ABBV, ENB, and MO. My positions are essentially full-sized positions based on my dynamic and flexible system for determining DivGro target weights, so I’m not planning to add shares at this time.

    Screen Shot 2022-02-03 at 10.14.03 AM

    Although my ENB position is somewhat overweight, I don't like trimming stocks to achieve ideal target weights. The tax implications of selling winning positions are problematic, though that objection only applies to positions held in our taxable accounts. My strategy is to invest in underweight positions (rather than trim overweight positions) and slowly move towards my ideal target weights.

    This month’s stocks are mostly suitable for income investors, but MO and ABBV should interest value and dividend-growth oriented investors, respectively.

    As always, I advise readers to do their due diligence before investing.

    Thanks for reading and take care, everybody!

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    Also read:

    7 Dividend Growth Stocks For January 2022

    Top 7 Dividend Growth Stocks Picks For 2022

    8 Best Defensive Dividend Growth Stocks

    4 High Yield Closed-End Funds For Your Income Portfolio

    2 Dividend Stocks On My Buy List

    Focusing On Income, Too Many Stocks & Wrong Valuation: More Mistakes You Could Be Making

    18 Dividend Stocks To Consider For The Next Decade

    Hybrid Funds To Complement High Yield Portfolios