Why not all dividends are created equal. Robert Shearer, lead portfolio manager for BlackRock’s Equity Dividend Fund explains why some dividend stocks are better than others and where he is finding the best in growth and income.
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WEALTHTRACK Episode #946; Originally Broadcast on May 10, 2013
Listen to the audio only version here:
Robert Shearer
WebEXTRA: What’s Happening In A Pro’s Personal Portfolio?
WebEXTRA: The Shearer Stocks
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Guest Info
ROBERT SHEARER
Lead Portfolio Manager
BlackRock Equity Dividend Fund
BlackRock Natural Resources Fund
Newsletter
A recurring theme on WealthTrack has been longevity risk. The good news is many of us are living longer than our parents’ or grandparents’ generation did. At least one spouse of a U.S. married couple aged 65 can expect to live until 92. We should all be so lucky! The risk to this longevity, and it is a very real one, is that we will outlive our savings.
A related theme on WealthTrack has been the intensifying search for income, particularly among retirees to fund their retirement. With interest rates at record lows, bonds, the traditional source of income are not doing the job. In addition, coupons on bonds are fixed. They don’t grow and they don’t keep up with inflation. Stock dividends on the other hand have been growing substantially over the last quarter century, while bond income has been decreasing.
Dividend stocks have another advantage. According to a recent BlackRock study, dividend paying stocks have outperformed the market and non-dividend payers for over 4 decades. Past is not necessarily prologue however. Has the search for dividend income become a so called “crowded” trade? Are income stocks too expensive? Those are some of the questions I will put to this week’s WealthTrack guest, Robert Shearer. Shearer is the highly respected lead portfolio manager for the nearly $30 billion BlackRock Equity Dividend Fund, which is in the top 3% of its Morningstar large value category for the last ten years with its 10% average annualized returns. He has also run the much smaller, high performance BlackRock Natural Resources Fund since its inception in 1997. That fund has returned 13.5% annualized returns in the same period. Surprisingly he has found synergies between the two!
We will have an additional discussion with Shearer about where he is investing personally in our WealthTrack EXTRA feature on our website. In case you haven’t seen our newly re-vamped website, please check it out. We have made it easier on the eyes and to navigate for you. We are adding more content than ever before, including advice and insights from the top financial pros we interview every week. We would love to hear your feedback and suggestions.
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Have a great weekend. And make the week ahead a profitable and a productive one!
Best regards,
Consuelo
Action Point
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One Investment
Honeywell International Inc. (HON)
Price: $77.74 on 5/10/13
52-week range: $52.21 – $78.08
Comcast Corp. CL A Special (CMCSA)
Price: $43.08 on 5/10/13
52-week range: $28.09 – $43.36
“The things we’re looking at are some of the industrials I mentioned- Honeywell- before, which is improving its margins in aerospace, energy efficiency, security, diversified revenue streams, and as I say they’re getting tremendous margin of improvement. We also like Comcast, the largest cable supplier, cable television supplier in the country. Made a very good acquisition of NBC Universal, which is providing product into their programming as well as their theme parks, which are doing very well.”
-Bob Shearer
Transcript
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