The DivGro Weekly—03.11.23

140 Consecutive dividend increases

This week we received further real-time, tangible evidence of outstanding business progress when we collected our quarterly dividends from Stryker, American Tower and Watsco, and became entitled to our quarterly dividends from Texas Instruments and Zoetis, all higher than this time last year.

Since DivGro's inception we have predicted and benefited from 140 consecutive dividend increases across our portfolio companies. The average rate of these dividend increases is 15.2%.

Zoetis, our dominant animal healthcare leader, has already established superb dividend growth credentials, having grown its dividend above 18 per cent per annum compounded since it was spun out from Pfizer in 2013. An initial quarterly dividend of 7 cents per share has mushroomed more than fivefold, nearing 38 cents per share per quarter. Plus, pet insurance is on the rise: in the US, pet insurance penetration is approximately 3 percent—versus 9 per cent in Australia and 25 per cent in the UK—and Zoetis is benefiting disproportionately from this sweeping trend. A global uptick in pet insurance generates more vet visits which in turn facilitate easier dispensation by vets of their preferred medications, which are invariably Zoetis products. This dynamic reinforces Zoetis’s entrenched position and complements its attractive pathway to continued strong sales growth and profitability, propelling a promising dividend growth trajectory in parallel.