CAH

I am a firm believer that asset allocation plays a significant part in a portfolio’s long-term results. Recently, I received a question asking if you could have a diversified portfolio of dividend stocks. It is an interesting question that deserves further examination.

The Coca-Cola Company (NYSE: KO) reported fourth quarter EPS was $0.66, up 53 percent, from $0.43 last year. analysts average $0.67. KO misses by $0.01.

Sales were driven by international volume growth of 6 percent in the quarter and 4 percent for the full year.

The Coca-Cola Company manufactures, distributes, and markets nonalcoholic beverage concentrates and syrups worldwide.

Cardinal Health Inc. is one of the leading wholesale distributors of pharmaceuticals, medical/surgical supplies and related products to a broad range of health care customers. Linked here is a detailed analysis and commentary.

Though many dividend stocks are now trading in excess of their calculated fair value, capital appreciation is not the primary reason for investing in dividend stocks. Dividend fundamentals are what drive my purchase decision, and if I could only look at one metric it would be...

Cardinal Health is one of the "big 3" pharmaceutical distributors. With a stable, recession-proof business and limited competition, along with a solid dividend with room for growth, Cardinal is a good, conservative Magic Formula stock.

McKesson enjoys a tight oligarchy in its pharmaceutical distribution business, and a highly profitable healthcare software unit adds both margin and growth advantages over competitors. A good Magic Formula buy.

Weekly roundup of stocks moving in and out of the Magic Formula Investing screen.

Over the last several weeks, the number of dividend stocks my model identified as a buy has greatly declined. On July 3rd it flagged 14 stocks as potential buys verses only 7 stocks on August 29th. Needless to say the recent market rally has made many dividend stocks expensive.

A question I often get is, “What do you think of the market? Where’s it headed?” Normally, I politely respond as expected, but occasionally I will startle the person with a reply like, “I don’t know. For me it really doesn’t matter much.” My investing goals are not defined by movements in the market.

In 1985 took my first job as a staff accountant with a $21,000 annual salary. Now I am over the same department that I was hired into and entry level staff accountants earn $56,500 per year. That equates to a 4.2% annual increase. Just as employees expect an annual raise, so do dividend investors.