Dividend Growth Process
To identify high quality companies who possess an attractive balance of current yield, dividend growth, and appreciation potential.
Detailed Step Breakdown
Step 01: Identify Investment Universe
- Must be members of the S&P 500
- Must have increased dividends every year for the last 25 years.
Step 02: Dividend Screening
- Dividend Yield
- Identify companies who meet our minimum yield requirements.
- We are seeking companies with at least a reasonable level of current income. We will favor higher yielding companies, but will entirely eliminate companies who do not meet our yield requirements.
- Payout Ratio
- We are looking for companies who will be able to continue paying and increasing dividends as indicated by a reasonable payout ratio. We favor companies with lower payout ratios, but will eliminate any company with a payout ratio we deem to be excessive.
Step 03: Quality & Volatility Screening
- Long Term Debt/ Market Capitalization
- We favor companies who don’t have excessive leverage.
- The LTD/MC metric is one criteria we use to identify companies with a strong balance sheet and reasonable debt.
- Return on Equity
- This is used to identify companies who are prudent stewards of shareholder capital and are using the money to generate profits.
- Stock Volatility
- We use multiple volatility metrics to help us identify the expected volatility of a stock. We tend to favor lower volatility stocks.
Step 04: Fundamental & Technical Analysis
- Fundamental Analysis
- This analysis is done with the goal of identifying companies we feel are undervalued, have strong cash flows and solid balance sheets. Even if a company meets all the screening criteria, it will not be included in the portfolio unless it is deemed a good investment based on our research.
- Technical Analysis
- While technical analysis is never the primary reason for purchasing a stock, we will favor companies that have a favorable technical profile based on our internal technical analysis and screen system.
Step 05: Portfolio Construction
- The portfolio will generally be constructed of 20-30 stocks
- Once companies are identified for purchase they are weighted in the portfolio based on dividend yield with a heavier weighting to companies with a higher dividend yield.
- To maintain sector diversification we generally limit any one sector exposure to a maximum of 30% at the time of purchase. Due to stock movement, individual sector exposures will increase or decrease over time.
- Portfolio will be continuously monitored and traded as often as necessary.
Blackhawk Capital Partners values long term relationships with our clients. We recommend personalized investment strategies. Each investment strategy has a blended benchmark which we seek to beat over the long term. We manage strategies covering the full range of investment objectives which allows us to specifically address individual client needs.
Our targeted results:
- Enhanced Wealth
- Increased Cash Flow
- Reduced Tax Liability
- Improved Security
- Lowered Expenses
Blackhawk Capital Partners uses a results oriented process of identifying and capitalizing on successful planning opportunities. We measure success based on our results.
What Financial Documents Should You Keep On File?
- Investment Statements
- Bank Statements
- Credit Card Statements
- Mortgage Statements
- Social Security Benefit Statements
You might be surprised how many people have financial documents scattered all over the house – on the kitchen table, underneath old newspapers, in the hall closet, in the basement. If this describes your financial “filing system,” you may have a tough time keeping tabs on your financial life.