Buying Dividend Growth Stocks at an Early Stage

Dividend growth investors usually focus their attention on companies that have been able to sustain consistent dividend growth over several decades, and this is certainly an intelligent way to invest. However, some high-quality companies, such as Costco (NASDAQ: COST), Nike (NYSE: NKE), and Starbucks (NASDAQ: SBUX) have the fundamental quality to continue raising payments in the long term, even if their dividend-growth track records aren't among the longest ones in the market. Do they deserve a place in your dividend growth portfolio?

Costco, Nike, and Starbucks have relatively short dividend growth histories, at least in comparison with a dividend juggernaut like Coca-Cola, which has raised its payments for more than 50 consecutive years. However, these companies have the fundamental soundness to generate consistently growing cash flows over time, and they have already started building their dividend-growth track records. Maybe they deserve some consideration from investors looking for an early entry point in companies offering extraordinary dividend growth potential.

Source: Motley Fool

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