The DivGro Weekly—17.05.24

162 Consecutive dividend increases

Weekly Dividend Progress

This week we received further real-time, tangible evidence of outstanding business progress when we collected our dividends from Mastercard, American Express and Costco and became entitled to our quarterly dividends from Microsoft, Cintas and Poolcorp, all meaningfully higher than this time last year.

How We Are Tracking

Since DivGro's inception we have predicted and benefited from 162 consecutive dividend increases across our portfolio companies, with no decreases. The average rate of these dividend increases is 14.9%.

Cintas

From unglamorous origins — Cintas was born in Depression-era 1930s and began with washing and selling discarded rags — the company has experienced a meteoric rise, developing a stranglehold on the market for uniform rentals first and later sanitation, fire-safety and first-aid services. The company’s dividend has grown every year at a rate of more than 18 per cent per year compounded, powering one of the best investment records of any company over the same 41-year time period. An undisputed scaled leader in its segments, Cintas has proven itself an overwhelming Goliath against highly fragmented competitors who cannot rival the company on cost, quality, performance, reliability or speed of service. This cluster of privileges reinforces the company’s entrenched position and capacity to take incremental share from weaker competitors. If, as Cintas believes, its addressable market comprises at least 16 million businesses (Cintas currently services one million businesses), the company has immense latitude to envelop the market over time and simultaneously to strengthen its already impressive dividend growth record in the future.