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While periods of market declines are painful to endure, they also offer the chance to buy great businesses at reduced prices. For dividend stocks, this benefit is two-fold, as investors not only get lower earnings valuations, but receive higher dividend yields as well.

One way to do that is to start with the Dividend Achievers, a group of stocks with at least a decade of consecutive dividend increases. These 3 Dividend Achievers have at least 3% current yields and have increased their dividends for over a decade.

Best Buy Co., Inc. (BBY)

Best Buy is a technology retailer that operates mostly in the US, and with a small presence in Canada. The stores and e-commerce sites offer computers, mobile phones, networking products, tablets, and other consumer electronics products. It also offers gaming products, home appliances, and technical support, among other things.

Best Buy operates more than 1,100 stores across the US and Canada that collectively generate about $46 billion in annual revenue.

Best Buy reported better than expected Q2 FY2024 on August 29th, 2023. GAAP diluted EPS decreased to $1.25 from $1.35. Comparable enterprise revenue decreased (-6.2%), driven by a fall in comparable sales and permanent store closures. Comparable domestic online sales decreased (-7.1%) to $2.76B compared to the prior year. 

Future growth is likely over the long-term. Demand for new electronics has only grown over time. Also, Best Buy’s Geek Squad and TotalTech services offer advantages relative to traditional retailers providing a level of expertise and service not typically found at other retailers. Plus, BBY has nearly six million paid membership customers, providing another advantage for installation and services.

Best Buy’s dividend increase streak is 20 years. Retail is generally cyclical, but Best Buy has managed to protect and raise its dividend through all parts of the economic cycle.

The combination of a lower share price and higher dividend means the current yield is 5.2%. We see the payout ratio under 60% for this year, indicating a secure payout.

BlackRock Inc. (BLK)

BlackRock is a large investment and asset management firm. It was founded in 1988 and today has over $9 trillion of assets under management (“AUM”). BlackRock provides investment management, risk management, and advisory services for institutional and retail clients worldwide. Its products include single and multi-asset class portfolios, equities, fixed income, alternative investments, and money market instruments.

Around 80% of BlackRock’s revenue is derived from investment advisory, administration fees, and securities lending, while the remainder is generated from performance fees, distribution fees, and technology services revenue.

On 10/13/23, BlackRock announced its Q3 2023 results. For the quarter, revenue rose 5% to $4,522 million, primarily due to organic growth, the impact of market movements over the past 12 months on average AUM, and higher technology services revenue. Operating income climbed 7% to $1,637 million, operating margin expanded to 36.2% (versus 35.4% in Q3 2022), net income climbed 14% to $1,604 million, and adjusted EPS jumped 14% to $10.91.

In the big picture, BLK’s overall business remains intact -- its Q3 AUM was 14.3% or $1.1 trillion higher versus a year ago, which includes $307 billion of net inflows with positive flows across exchange-traded-funds, active, and cash management. Just like in Q1 and Q2, BLK bought back $375 million worth of common stock in Q3.

BLK has increased its dividend for 13 consecutive years. It supports a safe dividend with room for continued dividend hikes. Its five-year dividend growth rate is 14% annually. The payout ratio of in the 50% range means the current dividend remains sustainable. Shares currently yield 3.1%.

Texas Instruments (TXN)

Texas Instruments is a semiconductor company that operates two business units: Analog and Embedded Processing. Its products include semiconductors that measure sound, temperature and other physical data and convert them to digital signals, as well as semiconductors that are designed to handle specific tasks and applications.

Texas Instruments reported its second quarter earnings results on July 25. During the quarter Texas Instruments generated revenues of $4.53 billion, which represents a decline of 13% versus the previous year’s quarter. This beat analyst estimates by $160 million, as the analyst community had forecasted a weaker sales performance.

Texas Instruments managed to keep its gross profit margin at an attractive level of 64%, while the company’s operating profit margin of 43% remained strong as well. Texas Instruments generated earnings-per-share of $1.87 during the second quarter, which was better than the consensus estimate, coming in $0.10 ahead of the analyst community’s forecast.

Long-term growth is likely. TXN should be able to benefit from rising demand for processors, as favorable trends such as industry 4.0 and automation pose long-term tailwinds. Texas Instruments’ aggressive share repurchases boosts its earnings-per-share growth, as the company has bought back nearly 50% of all shares since 2004.

Thanks to its strong cash generation, Texas Instruments was able to finance shareholder returns of $6.5 billion during the last four quarters. The company has increased its dividend for 20 consecutive years, including a 5% hike on October 19^th. Shares currently yield 3.5%.

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