The DivGro Weekly—04.02.22

89 Consecutive dividend increases

This week we received our quarterly dividends from Stryker, Lowe's and Watsco, and we became entitled to our quarterly dividend from Texas Instruments.

Since DivGro's inception we have predicted and benefited from 89 consecutive dividend increases at an average annual increase rate of 14.4%.

Texas Instruments (TI) is the global leader in analog semiconductors, providing inexpensive but mission critical components to over 100,000 customers across 80,000 product lines. While most companies try to minimise resources tied up in inventory - because excess inventory is deemed inefficient and disliked by the investment community - unusually, TI instead actively holds as much inventory as it can manufacture. While competitors routinely run out of stock and let customers down, TI rather prioritizes customer wellbeing by always having stock available to meet their needs. Due to this, TI often suffers the wrath of myopic investment analysts who would prefer to 'optimize the quarter', while TI deliberately uses its inventory build-up as a strategic weapon to delight customers and take market share over the longer term. TI can do this because unlike the rapid obsolescence of digital semiconductors, TI's analog components are long-lasting, substantially unchanged and always in demand for many years. Allied with its structural cost advantage, TI's enlightened approach to inventory management has helped power its dividend higher every year since 2004 at a superb compounded average rate of 26% per year.