March 8th, 2021 | 10:59 CET
AT&T, Altria Group, Q&M Dental - Dividend hunters, watch out!
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The native Rhineland-Palatinate has been a passionate market participant for more than 25 years. After studying business administration in Mannheim, he worked as a journalist, in equity sales and many years in equity research.
AT&T - Dividend aristocrat with an uninterrupted increase for 37 years
US telecommunications giant AT&T has been paying an uninterruptedly increasing dividend for 37 years, making it one of a class of stocks known as the Dividend Aristocrats. The last annual dividend was USD 2.08, and the dividend yield was 7.24%. As is customary with US stocks, the dividend is paid quarterly. Most recently, there had been discussions about whether AT&T should possibly cut its dividend, which the Company was able to fully finance from its cash flow, in order to have more funds for a corporate restructuring - primarily due to its weakening business with its satellite TV subsidiary DirecTV.
However, at the end of February, the Company announced that DirecTV would be transferred to a joint venture with TPG Capital, which should provide the Group with a cash inflow of USD 7.6 billion in the second half of the year. The crisis seems to have been averted here for the time being. Another construction site is the film studio WarnerMedia (formerly Time Warner), which was acquired in mid-2018 and is currently generating hardly any box office revenues due to the pandemic. The start of numerous productions has also had to be postponed.
On March 12, the Company plans to provide further guidance at an analyst conference. Anyone interested in the title can get the latest information here on how the Group is to continue. We assume that the Company will not shake its dividend policy in the near future.
Q&M Dental Group - No aristocrat, but a lot of potential
How does a penny stock go together with dividends? Quite simply, some stocks cost only a few cents but still pay dividends. Q&M Dental Group from Singapore is one of those stocks. Founded in 1996, the Company is now Asia's largest private dental Group with 114 medical practices, 5 dental clinics and 3 sales companies. Q&M Dental is by far the leading private provider of dental services in Singapore. The share, which is also traded in Frankfurt, is currently trading at around SDG 0.60. Since the beginning of the year, the share price has already risen by around 30%.
One of the reasons for this is the Company's dividend policy, which is boosting investor confidence in the stock. With the announcement of the last figures on March 1, the Company announced a profit increase of 10% to SGD 19.7 million and the payment of a regular dividend of 0.5 cents per share as well as a special dividend of 2.5 cents. As a result, the dividend yield is just under 5% p.a. In 2020, it did not initially look as if this would be a good year for companies in the dental sector. Even more than in other countries, dental services were suspended in Singapore due to the Covid-19 pandemic.
However, the Company responded promptly and became involved in the distribution of Covid-19 test and laboratory kits. For the future, the Company is focusing on expanding its franchise system to include countries such as China and Malaysia, as well as the use of artificial intelligence (AI) in everyday practice. Also, the opening of 10 dental clinics, which could not occur in 2020 due to the pandemic, is now to be made up for in 2021. Therefore, the prospects are excellent for investors who want to benefit from the current dental boom in Asia and the strong demand for Covid-19 test and laboratory kits.
Altria Group - Uninterrupted dividend growth for 51 years
Another Dividend Aristocrat is the US-based Altria Group, better known as the corporate parent of Philip Morris and one of the largest cigarette producers in the world. Following the sale of its 87% stake in Kraft Foods in 2008, Ste. Michelle Wine Estates is the only operating unit left in the conglomerate that is not involved in tobacco products. However, the Group still holds significant stakes in other companies, such as AB InBev (around 10%), Canadian cannabis producer Cronos Group (about 45%) and e-cigarette brand JUUL Labs (about 35%).
On February 26, the Company announced a quarterly dividend of USD 0.86, equivalent to USD 3.44 for the year. The dividend yield was thus 7.89% on the record date. The ex-dividend date is March 24. In the course of the presentation of the quarterly figures, the Group outlined its vision of how, in the face of increasing global regulation, it could detach itself from its main business of combustion tobacco and turn to new business areas.
22% of sales are currently already made with tobacco alternatives consumed "without combustion" (tobacco sticks, pouches). The extent to which this can allay moral concerns about an investment in a cigarette company is a matter for each investor to decide for himself. In any case, the share price has performed well since the beginning of the year, rising by 12%. And from a dividend point of view, the Company also seems to be a safe bank. For the time being, anyway.
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