Dividends4Life: Airgas: One Of Those Great Dividend Stocks That Nobody Notices

Over the past ten years, Airgas (NYSE:ARG) has compounded annual returns of 18.30%, turning every $10,000 invested in 2004 into the tidy sum of $56,350.88 today. This can be traced to a great earnings-per-share growth rate posted by Airgas, which amounts to 17.5% annually over that time. As earnings have grown from $1.20 to $4.90-$5.20 range (depending on how the end of 2014 turns out) over the past ten years, and the dividend has grown from $0.18 annually to a $2.20 annualized clip over the 2004-2014 pace, Airgas has quietly been establishing itself as a superior dividend growth stock.

Airgas occupies an important spot on the short list of dividend growth companies that (1) raised its dividend during the financial crisis, (2) has a record of 10% or more annual dividend growth that seems reasonably poised to continue, and (3) is not overvalued. The yield may hold some investors back, as presently, the stock only offers prospective investors a starting yield of 1.96%, but that has largely been the function of superior business growth that continually drives the price of the stock forward. For those looking for a nice dividend growth rate plus reasonable capital gains, accepting a low initial dividend yield may prove worthwhile.

Source: Seeking Alpha

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