The economic cycle is the underlying driver of consumer cyclical companies’ performances. Businesses such as Ludlow Jute & Specialities and VTM offer products that are considered luxury items, rather than those of absolute necessity, for example gambling and day spas. During times of growth, consumers tend to make more discretionary purchases which will drive these companies’ profitability. Dividend payouts are, in turn, positively impacted by this growth which means these companies could provide opportune income through dividends. Here are my top dividend stocks in the consumer cyclical industry that could be valuable additions to your current holdings.
Ludlow Jute & Specialities Limited (BSE:526179)
526179 has a good-sized dividend yield of 2.69% and is distributing 36.40% of earnings as dividends . Despite there being some hiccups, dividends per share have increased during the past 10 years. The company recorded earnings growth of 30.32% in the past year, comparing favorably with the in luxury industry average of 5.78%. More detail on Ludlow Jute & Specialities here.
VTM Limited (BSE:532893)
532893 has a decent dividend yield of 2.58% and pays out 45.68% of its profit as dividends . Dividends per share have increased during the past 10 years, but there have been a couple hiccups. However, they have historically always picked up again. The company’s level of debt of 4.76% compared to it’s net worth is satisfactory (less than 40%), which indicates on the surface that the company is in a healthy position. More detail on VTM here.
Damodar Industries Limited (BSE:521220)
521220 has a wholesome dividend yield of 2.10% and is paying out 27.68% of profits as dividends . Despite there being some hiccups, dividends per share have increased during the past 10 years. More on Damodar Industries here.
For more solid dividend paying companies to add to your portfolio, explore this interactive list of top dividend payers.