Income stocks tend to be large, mature, big-cap companies with
slower growth. Dow component3M (
) fits the bill.
The St. Paul, Minn.-based firm offers investors steady growth
and rising dividends.
Since 2000, the maker of everything from Post-it notes to
bandages to medical devices has delivered top- and bottom-line
growth in all but two years. It has a five-year Earnings
Stability Factor of 7, indicating a steady stream of profits.
Last year, 3M's earnings rose 7% to $6.37 a share, thanks to
strength in its health care and industrial and transportation
segments. Regionally, the company saw strong demand for products
in Canada and Latin America, but Europe was a weak spot.
Analysts polled by Thomson Reuters see profit rising another
7% this year. Growth is expected to pick up to 10% in 2014.
Last month, 3M raised its quarterly dividend by 8% to 63.5
cents a share. The company has raised its dividend for 55
straight years. 3M is a member of the S&P 500 Dividend
Aristocrats index, which tracks the performance of large-cap
stocks that have raised dividends each year for at least 25
At an annual rate of $2.54 a share, the stock has a yield of
about 2.4%. The stock has a yield that's a little above the
midpoint of the 26 dividend-paying stocks in IBD's Diversified
Operations industry group.
3M is generally a slower mover, but it has been on a tear this
year. The stock has advanced in every single week so far in 2013.
This past week, 3M eked out a tiny gain and stretched its win
streak to 12 weeks.
The stock cleared a 94.24 buy point from a cup base Jan. 2 and
has never looked back. It has gained about 13% since then. The
Dow component has yet to even pull back to its 10-week line.