Our Top 10 Dividend Growth Stocks - April 2024

Core Insights - The focus is on selecting high-growth dividend stocks that have rapidly increased their dividends in the recent past and are expected to continue growing their earnings at a fast pace [2][22] - Two categories of dividend stocks are identified: High Growth Low Yield (HGLY) and Low Growth High Yield (LGHY), catering to different investor needs [3][4] - A structured portfolio approach is recommended, allowing for a maximum of 20 stocks, with periodic monitoring and adjustments based on performance [6][12] Stock Selection Criteria - Stocks must have a market cap greater than $10 billion, a dividend yield above 1%, and a daily average volume exceeding 100,000 [7] - Additional criteria include a minimum of five years of positive dividend growth and a Dividend Safety Quality Score based on various financial metrics [7][8] - A focus on earnings growth is emphasized, with a modified Quality Score that incorporates EPS ratings and expected changes [8][12] Portfolio Construction - The portfolio should be diversified across sectors, with a maximum of 20 positions, and new stocks should be added based on monthly reports [6][15] - The final selection of stocks aims for diversity across industry segments while considering quality scores and relative strength ratings [15][22] - The top 10 high-growth dividend stocks for the current month are presented, with a note on the potential for repeat selections from previous months [15][22] Performance Analysis - Historical performance comparisons are made between the selected stocks and benchmark indices like the Vanguard Dividend Appreciation Index Fund ETF and the S&P 500 [16][19] - The performance of the model portfolio is tracked monthly, allowing for assessment of the investment strategy over time [19][22]