This article examines each of these 3 businesses based on the 5 Buy Rules from the 8 Rules of Dividend Investing. The 8 Rules of Dividend Investing identifies high quality businesses trading at fair prices based on several metrics including number of years of dividend payments without a reduction, long-term revenue per share growth rate, and standard deviation. It is difficult to find established businesses with high dividend yields and strong growth in today's overvalued market. General Mills (GIS), McDonald's (MCD), and Target (TGT) all have dividend yields over 3% and long-term revenue per share growth rates over 6%.
Target, General Mills, & McDonald's all have strong 10-year growth rates and high dividend yields. General Mills & McDonald's also have low volatility and average payout ratios. Target has fairly high volatility and a high payout ratio. As a result, both General Mills & McDonald's are Top 10 stocks based on the 8 Rules of Dividend Investing, while Target is in the top 40.
Source: Seeking Alpha
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