Money and Finance
Innophos is in a range of pretty boring businesses, the cover the phosphate waterfront - Specialty Ingredients, Asphalt Modifiers, Fire Suppressants, Water Treatment, Bakery Leavening, Deli Meats (hungry yet?), Toothpaste Abrasives, and more. I have followed the company for awhile, Todd Wenning wrote it up in his search for dividend growers, and Barron's profiled the company this week and there is a lot of interesting pieces to this puzzle.
The Barron's article highlights some recent issues and a potential catalyst:
The company's manufacturing facility in Mexico has been the source of recurring equipment failures, which has hurt productivity and resulted in high maintenance costs. As recently as the September quarter, a planned maintenance outage took longer to complete than expected, due to the extensive repairs required.
For the past few years, management has been upgrading the facility, and on its Oct. 29 conference call, CFO Mark Feuerbach said that he believes the plant "has turned the corner." Indeed, the plant generated higher production yields in the quarter.
Overall, the key dividend growth qualities looks to be in place.
The balance sheet is not subject to much leverage with a 0.3 Debt/Equity ratio.
The company's price is not that cheap. The P/E is 22 on trailing basis and the P/CF is 14.
Last month, I looked Clorox and it appeared to be quality company at a reasonable price. Innophos stacks up pretty well alongside Clorox.
(Source: Morningstar)
Innophos beats Clorox across the boards, and whereas Clorox debt to equity ratio is a stratospheric 26, Innophos operates much, much more conservatively (0.3 Debt/Equity). Clorox has excellent brands and great long term track record, but on the metrics that matter for dividend growth investors, Innophos looks to be a better buy today.
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Money and Finance
Innophos - Can Phosphates Deliver Dividend Growth?
Innophos is in a range of pretty boring businesses, the cover the phosphate waterfront - Specialty Ingredients, Asphalt Modifiers, Fire Suppressants, Water Treatment, Bakery Leavening, Deli Meats (hungry yet?), Toothpaste Abrasives, and more. I have followed the company for awhile, Todd Wenning wrote it up in his search for dividend growers, and Barron's profiled the company this week and there is a lot of interesting pieces to this puzzle.
The Barron's article highlights some recent issues and a potential catalyst:
The company's manufacturing facility in Mexico has been the source of recurring equipment failures, which has hurt productivity and resulted in high maintenance costs. As recently as the September quarter, a planned maintenance outage took longer to complete than expected, due to the extensive repairs required.
For the past few years, management has been upgrading the facility, and on its Oct. 29 conference call, CFO Mark Feuerbach said that he believes the plant "has turned the corner." Indeed, the plant generated higher production yields in the quarter.
Overall, the key dividend growth qualities looks to be in place.
- Forward yield 3.3%.
- 1 Year Dividend Growth: 24%
- 5 Year Dividend Growth: 13%
The balance sheet is not subject to much leverage with a 0.3 Debt/Equity ratio.
The company's price is not that cheap. The P/E is 22 on trailing basis and the P/CF is 14.
Last month, I looked Clorox and it appeared to be quality company at a reasonable price. Innophos stacks up pretty well alongside Clorox.
| Company | Fwd Yield | 1 Yr Div Growth | 5 Yr Div Growth | P/CF |
| Innophos | 3.3% | 24% | 13% | 14 |
| Clorox | 3.1% | 7% | 10% | 17 |
(Source: Morningstar)
Innophos beats Clorox across the boards, and whereas Clorox debt to equity ratio is a stratospheric 26, Innophos operates much, much more conservatively (0.3 Debt/Equity). Clorox has excellent brands and great long term track record, but on the metrics that matter for dividend growth investors, Innophos looks to be a better buy today.
- The Double Edged Sword
When it comes to capitalizing a company management has two options: equity or debt. If you look across the publicly available companies you'll find all sorts of mixes in capital structures. Some companies like Visa (V) (Analysis Here) are fully...
- You Can't Clean Up A Messy Valuation: The Clorox Company Dividend Stock Analysis
Consumer staple companies make for excellent defensive investments and dividend growth candidates due to the rather inelastic demand for their products. For those companies that have established brands and market share they can typically pass along input...
- Fourth Pick In The Wmd Portfolio - Raven Industries
The more real they are, the more fun blogs are to follow. So in that spirit, rather than talking about ideas in the abstract I maintain a hypothetical portfolio to track ideas where I'll semi-regularly (and hypothetically) invest and track buying...
- Todd Wenning On Finding Differentiated Dividend Ideas
One of the good things about dividend investing is also a challenge. Dividend investing forces you to screen out many stocks, because they do not pay a dividend at all. And really, for most dividend investors, you are going to want at least a 2 or 3%...
- Is Clorox A Buy?
All time market highs make bargain hunting hard graft (in the US markets at least). Where can we find a safe harbor to invest at current prices? Over at Morningstar, Josh Peters makes the case for Clorox. I really like finding companies like Clorox...