The DivGro Weekly—21.07.23

133 Consecutive dividend increases

This week we received further real-time, tangible evidence of outstanding business progress when we collected our quarterly dividends from Heico and Intuit, and became entitled to our quarterly dividends from Abbott, Watsco and Zoetis, all significantly higher than this time last year.

This week we paid our 15th consecutive quarterly distribution. This distribution is 12.1% higher than this time last year. DivGro has increased its distributions by a double-digit percentage every year since inception. Compared to our first distribution paid in January 2020, this distribution is already 2.1x higher.

Since DivGro's inception we have predicted and benefited from 133 consecutive dividend increases across our portfolio companies. The average rate of these dividend increases is 15.3%.

Zoetis, our animal health leader, is sometimes misunderstood by investors because having gone through an IPO in 2013 it appears on the surface like a relatively new company. In fact, its privileged position derives substantially from its longevity, having cultivated its dominant global leadership in predicting, preventing, detecting and treating animal illness for almost 60 years as a division within Pfizer. Indeed, in many of its segments, such as companion animal dermatology, Zoetis is effectively the only player with its 95% market share. Dominant market positions such as this have enabled Zoetis to earn higher returns on invested capital than the pharmaceutical and healthcare sectors, which already enjoy higher than average returns. With the animal health market expected to nearly double to US$80billion over the next decade, Zoetis enjoys an extremely favourable backdrop for extending its already impressive dividend record, which has compounded at an average rate of 20% per year since 2014.