Quality Dividend Yield
Providing high levels of current income, from attractively valued, higher-yielding, large-cap equities.
Overview
Haverford's Quality Dividend Yield Portfolio is designed to meet the needs of investors who desire a balance between current portfolio income and the opportunity for future appreciation. We choose companies for the portfolio based on superior financial strength, above-average and consistent earnings growth, regular and growing dividend payments and a strong competitive position.
Investment Philosophy
- High quality, established companies provide superior returns with less risk.
- Dividend paying companies provide superior returns with less risk.
- Attractively valued stocks with high dividend yields offer the opportunity for above-average capital appreciation and enhanced income.
- Stock prices follow earnings growth.
- Appropriate diversification lowers risk.
Investment Process
Portfolio Characteristics*
| Haverford | S&P 500 | |
| Financial Strength | A+ | B++ |
| Earnings Predictability | 73.0 | 64.0 |
| Beta to S&P 500 | 0.9 | 1.0 |
| Average Market Cap ($Billion) | 89.0 | 113.0 |
| Return on Equity | 23.8% | 26.8% |
| Dividend Coverage | 2.0x | 3.7x |
| Projected EPS Growth (5 Years) | 8.3% | 8.0% |
| Historical EPS Dividend Growth (5 Years) | 5.4% | 1.8% |
| Hist. Dividend Growth (5 years) | 5.7% | 1.7% |
| Dividend Yield | 3.7% | 2.0% |
| Price to 2012 Earnings | 13.2 | 13.6 |
| Projected Growth Rate + Dividend Yield | 12.0% | 10.0% |
Sector Allocation*
| Haverford | S&P 500 | |
| Consumer Discretion | 11.7% | 10.7% |
| Consumer Staples | 14.4 | 11.5 |
| Energy | 12.2 | 12.3 |
| Financials | 14.1 | 13.4 |
| Health Care | 14.0 | 11.9 |
| Industrials | 12.1 | 10.7 |
| Information Tech. | 10.7 | 19.0 |
| Materials | 3.4 | 3.5 |
| Telecommunication | 4.3 | 3.2 |
| Utitlities | 3.3 | 3.9 |
Top-Ten Holdings*
| Yield | 2012 P/E | |
| Kimberly-Clark Corp. | 5.3% | 14.1% |
| Altria Group Inc. | 5.5 | 13.5 |
| Royal Dutch Shell PLC (ADS CI A) | 4.1 | 7.7 |
| Bristol-Myers Squibb Co. | 3.9 | 17.5 |
| NYSE Euronext | 4.1 | 12.2 |
| Total S.A. ADS | 5.0 | 7.1 |
| GlaxoSmithKline PLC ADS | 4.9 | 11.8 |
| ConocoPhillips | 3.5 | 8.9 |
| Merck & Co Inc. | 4.3 | 10.2 |
| JP Morgan Chase & Co. | 2.6 | 9.5 |
Notes:
* Based on recommended portfolio weights. The S&P 500 is for comparative purposes only. The S&P 500 is a capitalization-weighted indexes, calculated on a total return basis with dividends reinvested. The S&P 500 is an unmanaged index with no expenses, which covers 500 industrial, utility, transportation, and financial companies of U.S. markets. It is not possible to invest directly in an index. Portfolio characteristics, allocations, and holdings are subject to change at any time based on market and other conditions.
Measures of Financial Strength and Earnings Predictability are sourced from Value Line Inc. Beta measures exposure to market risk.
Disclosure:
All Data as of March, 31, 2012. The information presented should not be construed as investment advice or recommendations with respect to specific securities presented and may not represent the holdings or weighting of any particular portfolio.