Business Week: Top International Dividend Paying Companies

Business Week has come up with 20 stocks of international companies (that trade as ADR) with good dividend payments.

Here's the list (go to their site for details):

Allied Irish Banks	AIB
AstraZeneca	AZN
AXA	AXA
Banco Bilbao Viscaya Argentaria	BBV
Banco Santander	STD
Barclays	BCS
Chunghwa Telecom	CHT
Diageo	DEO
Enel	ENSTY
France Telecom	FTE
Genesis Lease	GLS
ING Groep	ING
Lloyds	LYG
Nissan Motor	NSANY
Royal Dutch Shell	RDSA
Sanofi-Aventis	SNY
Taiwan Semiconductor	TSM
Telecom Italia	TI
Telefonica	TEF
Total	TOT

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ETF : international dividend achievers from Powershares (PID-A)

You like CDZ (Claymore Dividends Achievers) but are looking to diversify your ETF holdings internationally? And, like me, believe that dividend achievers are the way to go? Then have a look at PID-A. It's a relatively new ETF from Powershares available on the American exchange but is based on the well established Mergent's Dividend Achievers indexes.

Instead of a passive index like XIN from iShares, PID favors companies that have been increasing their dividend payouts for the last 5 years. That gives you exposure to international companies that have a better chance at faring well under adverse markets in my opinion. Chances are that they'll keep increasing their dividends in the future as well.

So although the yield might always look small (around 2-3%), it will become greater for you based on the current buying price as the 'stock' price keeps increasing. (Notes: all the international companies in PID are ADR - American Deposit Receipts - which mean they trade on US markets. You should also look at the tax consequences of holding foreign equities.)

I would not put all my eggs in these types of ETF but I think they're a good complement to market value weighting types of ETF (passive). And it's way safer

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The Dividend Guy Blog has 10 reasons why dividend investing is good.

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Canadian Capitalist commented on ETFs ...

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For those of you who like to read lenghtier stuff, Dividend based investing has a good interview with Lowell Miller author of the Single Best Investment guide ... interesting quote from it:

When you are actually talking about investing (and that should be the major part of your assets because in today’s world, you know, lots of us are going to live to be 100 or more), you really have to avoid fixed income and you want a diversified portfolio of high yielding stocks where the dividend is going to grow. And to repeat myself – as I always do over and over again – the increasing dividends will prevent your purchasing power from being degraded by inflation, and the increasing income will also cause your principal to increase over time.

Alternative to Income Trusts: Dividend stocks are good but some are better!

In the G&M, Rob Carrick talks about alternatives to income trusts. The alternative that interests me the most is buying dividend paying stocks. My instinct would have been to grab those with the highest yield. But Rob makes a good point when he says that what we should look for first are companies that have consistently risen their payout year after year. This is a sign of a solid company that will reward investors for year to come. There are also more chances that this is a growing company and that it will give you capital gains as well (the stock price will go up!).

Here are three stocks mentioned that go in that category:

1. Astral Media: "largest stable of English and French specialty, pay and pay per view television services", "has increased its dividends 15 per cent annually over the past five years"
2. Manulife Financial:"world-class financial services company. It is global in scope, with operations in Canada, the United States and Asia", "Tremendous free cash flow generation with double-digit dividend growth (a five-year compound annual growth rate of 25 per cent) and only a 30-per-cent payout ratio, which speaks to the financial strength of the company and why we expect the double-digit dividend increases to continue"
3. Power Financial:"A holding company that directly owns 70.6 per cent of Great-West Life, 55.9 per cent of Investors Group and 27.1 per cent of Pargesa Holding SA, a European company that derives 95 per cent of its net asset value from four holdings: Total SA, Suez, Imerys and Lafarge.", "Over the past 10 years, Power Financial's dividend growth rate has been 18 per cent annually"

Two other stocks that might have been good but seen as too pricey:

1. Enbridge
2. TransCanada

Other alternatives are mentioned:

• preferred shares: doesn't look much better than bonds to me
• corporate bonds: only those from big banks are recommended
• government bonds: you won't get rich on those, but they are safe!

Interesting point made about bonds:

For investors who want to keep things safe and simple, Mr. Dong recommends the trusty old bond ladder, where you split your GIC or bond money evenly into one- through five-year terms