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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)

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.

SJM 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.

Recommended Action: Buy SJM.

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