The DivGro Weekly—19.06.26

220 Consecutive dividend increases

Weekly Dividend Progress

This week we received further real-time, tangible evidence of outstanding business progress when Heico increased its dividend by 8.3%. We also collected our quarterly dividends from S&P Global, Microsoft, Cintas and Alphabet and became entitled to our quarterly dividend from ADP, all meaningfully higher than this time last year.

How We Are Tracking

Since DivGro's inception we have predicted and benefited from 220 consecutive dividend increases across our portfolio companies, with no decreases. The average rate of these dividend increases is 13.9%.

Heico

Ever since the Mendelson family assumed control of Heico in 1990, the company’s dividend has taken flight — and helped power a 1000x growth in Heico’s stock. So, how did the Mendelsons cultivate Heico’s reputation as the go-to provider of aviation and aerospace aftermarket parts? While the intellectual property behind new aviation parts and equipment can usually be protected, the Mendelsons identified that often this won’t apply to aftermarket parts. So, while OEMs must find ways to recover their significant upfront R&D costs, via high and rising prices in the aftermarket, Heico develops parts specifically for the aftermarket — which perform equally well if not better and cost a fraction of competitors’ prices. In turbulent times (such as in recent months), when airlines are forced to continuously replenish parts while being extra cost-sensitive, Heico’s proposition — offering steep savings of 30-50% — becomes all the more compelling. In 36 years, the company has established a repertoire of more than 20,000 highly engineered aftermarket parts. Given modern aircraft require more than two million parts, Heico has immense runway to increase its product portfolio, capture market share and thereby extend its impressive dividend growth record.