Image Source: Unsplash

In 2011, I worked on a newsletter that used a seven-point system to find the best dividend stocks. My favorite was always “a business that your mother would love or at least understand.” J.M. Smucker Co. (SJM) is one such name I like, writes Kelly Green, editor of Dividend Digest.

Speculators are chasing share price movements on a screen. They make a trade when they think that number is going to move one way or the other. Investors are buying a business because they see long-term value. For dividend investors, we want the opportunity to collect a solid payout that will hopefully rise for many years to come.

J.M. Smucker Co. (SJM) Chart

So, it makes sense to look for businesses that “your mother” (or anyone not stock market-savvy) would be able to understand. This includes the “must have” in every dividend portfolio: Consumer staples.

It’s entertaining to go with me to the grocery store. Some people check the expiration dates before they buy something. I’m looking for the parent company of the product to see if it pays a dividend.

J.M. Smucker is the parent company of products spread across the entire grocery store. This Dividend Aristocrat owns a lot of brands beyond just jams and jellies. Here’s a few of them:

• Coffee – Dunkin, Café Bustelo, Café Pilon, and Folgers
• Pet Snacks – Milk-Bone, Meow Mix, and Pupperoni
• Hostess Snack Cakes – Ding Dongs, Fruit Pies, and Twinkies

Its recent yield was 3.8%, and it has raised the dividend for 28 straight years.

Given all of this, my recommended action would be to consider purchasing shares of J.M. Smucker.

About the Author

Kelly Green, senior editor at Mauldin Economics, has been a researcher for as long as she can remember. She was always fascinated with taking things apart and asking hundreds of questions—whether it was a car or a complex math equation.

Ms. Green turned to a career researching the lucrative field of high-yielding equities. She fell in love with exploring the ins and outs of income-investing opportunities and sell-side options trades.

Over the next few years, Kelly would work as co-editor of several income-focused newsletters, chief researcher, and portfolio analyst. She also wrote an educational series for investors covering topics ranging from making first trades to how to trade options.

More By This Author: