Dividend Income Strategy

Portfolio Manager: Marc Dion, CFA

Investment Objective:

• Provide high current income
• Provide less volatility than the equity market
• Provide the potential for capital appreciation and increasing income
  

Philosophy

The Morgan Dempsey Dividend Income Strategy invests in a diversified portfolio of equity securities. We attempt to identify and invest in companies that pay attractive current dividends and have historically raised the dividends paid to shareholders.

This portfolio is not necessarily broadly diversified and tends to be concentrated in sectors where we can find yield. We attempt to find companies, that in addition to the high current dividend, are trading at or near their historical dividend yield.

Given the primary objective is yield, we tend to hold many of these securities longer term and this portfolio has historically experienced relatively low turnover. Stocks are normally sold when the dividend yield reaches a level that we no longer consider attractive. Stocks are also sold when, in our opinion, the company experiences some fundamental deterioration in earnings or earning outlook.

We look for companies with the following characteristics at the time of purchase:

• Market Capitalization > $1 billion
• Dividend yield 1% higher than the S&P 500
• A commitment to dividends and dividend growth
• Solid dividend coverage
• Sustainable business model

What Investors Should Expect:

• High current income
• Potential for increasing portfolio income
• Potential for total returns consistent with value oriented portfolios
• Volatility associated with concentration in higher yielding sectors of the market
• Long-term investment perspective
  

Download Additional Information

Please click on any of the links to download additional detailed information about the Morgan Dempsey Dividend Income Strategy.

• Executive Summary (2 page .pdf)
• Dividend Income Presentation (14 page .pdf)

To request monthly performance numbers in excel format, e-mail David Durham.