The DivGro Weekly—05.07.24

164 Consecutive dividend increases

Weekly Dividend Progress

This week we received further real-time, tangible evidence of outstanding business progress when we collected our quarterly dividends from ADP and Nike and became entitled to our quarterly dividend from Heico, all meaningfully higher than this time last year.

How We Are Tracking

Since DivGro's inception we have predicted and benefited from 164 consecutive dividend increases across our portfolio companies, with no decreases. The average rate of these dividend increases is 14.8%.

ADP

For 75 years, Automatic Data Processing (ADP) has built a veritable standard of trust across the legions of businesses (more than one million) and employees (more than 40 million) it services every month when it acts as effective banker when executing their salary payments. These businesses rely implicitly on ADP in business-critical ways: they need to be certain monies processed through ADP do not disappear and that salary payments, benefits and taxes are computed correctly and paid on time. In these respects, ADP excels twofold: the company provides the businesses it serves with peace of mind and, due to its scale benefits, does so at a profit, at a nominal cost to its customers per employee. While this scale advantage is as enviable as it is hard to replicate, ADP’s esteemed reputation, established over many decades, combined with its timeliness, processing accuracy and breadth of service further insulates the company from competitors, reinforcing its dominance. The cherry on top? Even as ADP remains highly privileged, its $18 billion sales represent 12 per cent of the global market, meaning the company has ample opportunities to grow its formidable dividend record of 49 years and counting.