VIG - Capturing Dividend Growth Requires A Nimble Responsiveness

2024-04-25 11:35:00 ET

Summary

• Dividends and buybacks are two ways companies can return cash to shareholders.
• Dividend-growth ETFs are popular among investors interested in companies that consistently raise their dividends over time, but it is typical to require constituents to demonstrate 5, 10 or even 20 years of historical growth.
• DGRW, without any historical dividend-growth requirements for constituents, has consistently outperformed other Funds like VIG, SDY, DVY and DGRO.

By Christopher Gannatti, CFA

In 2024, we have seen Meta Platforms ([[META]], [[META:CA]]), Salesforce.com and Booking Holdings (parent company of Priceline.com) initiating dividend payments. ¹ Many technology companies have accumulated significant amounts of cash, with more calls to return this cash to shareholders by initiating dividends....

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