Recent economic data could cause the Federal Reserve to raise interest rates. When this will happen is anybody's guess. When it does happens, however, stocks with big valuations could see a lot more volatility.
In building a portfolio or planning for retirement, we need to be ready. Here are some options.
This group of safe dividend stocks won't necessarily impress you with their dividend yields, but they offer attractive value. The key is their low payout ratios and rapid dividend growth.
If and when interest rates increase, these 10 dividend stocks could be a reasonably safe place to be.
1. Newell Brands (NWL)
Through a series of mergers and acquisitions, Newell Brands has built a brand-name empire in consumer and commercial products.
The Newell Brands portfolio includes the following names: Rubbermaid, Lenox, Goody, Contigo, Waterman, Parker Pens, Paper Mate, Sharpie, Dymo, Graco, Aprica, Marmot outdoor gear, K2 Skis, Volkl Skis and Baby Jogger.
These brands -- and others -- bring in a total of about $5.92 billion in annual sales. The range of brands is so diverse that at least one of them likely will turn up wherever people shop.
Walmart is one of the largest buyers of Newell Brands products. Having a wide range of well-respected brand names eases the path to negotiating with this price-sensitive customer. In the final analysis, Walmart sets the base price for most of Newell's products.
This company's competitive edge comes from strength in product design and manufacturing combined with efficient distribution and advertising.
The other secret to Newell Brands' success is its strong sales base. The company's brands dominate writing (30% of sales) and several categories of what's known as "homecare."
The current 76 cent-per-share annual dividend payout offers investors a 1.5% yield. In the past five years Newell has been improving cash flow and the payout ratio as well. During this time, dividends have compounded at a 30.6% annual rate.
On Oct. 12, Newell announced the $1.95 billion cash sale of its tool business. That cash will be a significant addition to the $627 million already in Newell's bank account, further strengthening the safety of its dividend.