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Blue Chip Dividend Stocks: A Reliable Income Strategy

This managed equity strategy seeks current dividend income and growth of principal by investing in a diversified basket of large cap, blue chip multinational “dividend aristocrats” that have a long history of consistently growing dividends and earnings. These companies have the financial wherewithal to navigate through difficult periods, are primarily headquartered in the USA, and have a strong global footprint. 

 

Blue Chip Dividend stocks generally meet the following characteristics:

 

Solid Dividends - An important criteria is that the company pay a regular, consistent dividend with a history of annual dividend increases. Many have dividend yields that approach or exceed the yield on their respective 10-yr. investment grade bonds.

Strong Balance Sheets - We seek stable companies with significant free cash flow that may be used to buy back shares , boost dividends, or reduce debt levels.

Increased Earnings - The ability to deliver consistent and growing earnings, do more with less, leverage outsourcing and technology to improve productivity, and deliver improved profit margins and increased cash flow.

Easy Liquidity - The stocks must be highly liquid allowing easy entry and exit for client portfolios should the need for liquidity arise.

Lower Cost of Capital - In the wake of the financial crisis with inaccessible credit markets, the ability to bypass the banking system and raise money in the capital markets is a clear competitive advantage.

International Footprint – Investing in select multinational Blue Chip companies is an attractive way to diversify your portfolio and own a basket of leading global franchise brands—with the infrastructure, marketing acumen, and financial wherewithal to grow market share in the US domestic, international and emerging markets.

Established Market Position with Business “Moat” – These companies are industry leaders with strong brand identity, and are entrenched in markets across the globe.