NJR - New Jersey Resources: This Dividend Champion Looks Like A Buy Right Now
2024-07-10 07:00:00 ET
Summary
- New Jersey Resources is a Dividend Champion, with 28 consecutive years of dividend growth to its credit.
- The natural gas utility's operating revenue and non-GAAP EPS climbed higher in its fiscal second quarter.
- NJR's interest coverage ratio through the first half of its current fiscal year was strong for a utility.
- The natural gas utility could be trading 12% below fair value.
- NJR may be poised to post 12% annual total returns through September 2026.
Eventually, living off dividends is only viable so long as the underlying income stream of a portfolio possesses the following two traits:
- It is reliable. By that, I mean it can't be steady for a while, only to plunge from dividend suspensions/cuts in any given year.
- It is consistently growing enough to keep up with inflation. Even if a portfolio's passive income remains constant over the years, that's not enough by itself to sustain a viable retirement. Flat income year after year is itself a stealth dividend cut in my view.