The DivGro Weekly—09.09.22

105 Consecutive dividend increases

This week we received further real-time, tangible evidence of outstanding business progress when we collected our quarterly dividends from Microsoft, Wingstop and Moody's.

Having marked our calendars, we also look forward to receiving our quarterly dividend from Nike shortly.

Since DivGro's inception we have predicted and benefited from 105 consecutive dividend increases across our portfolio companies. The average rate of these dividend increases is 15.6%.

Enhancing its privilege since 1909, Moody's is today entrenched as a vital toll collector on global debt issuance. This means that companies and governments are faced with no real choice but to utilise Moody's and/or S&P Global (usually both) when they wish to raise debt capital. This is because without the Moody's 'stamp' the interest payable would be significantly higher, affording Moody's immense pricing power since the cost of a Moody's rating is trivial compared with the interest saved. Indeed, the extent of this privilege often means that buyers of government or corporate debt are constrained from even purchasing these instruments in the absence of a rating from one of Moody's or S&P Global (another DivGro holding). Moody's reputational advantage translates into remarkable profitability - with more than fifty cents of profit for every dollar of sales - which has helped underwrite a superior dividend record, rising a cumulative 700% since 2010.