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Dividend Growth Stocks - Financed by Equity Issuance?

I noticed an interesting divergence between dividend growth and shares outstanding in the algorithm below. The algo filters Top 500 by market cap (then some additional filters for liquidity and nominal trade price). Finally it filters for companies that have reported nominal dividend growth over 150 trading days. I then compare these companies against the quantity of companies with a contraction in shares outstanding (which I label "buybacks"). It appears that in the final quarter of 2015, the trend for dividend growth remained stable, however the trend for share contraction bucked entirely. Very interesting.....

Clone Algorithm
3
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Backtest from to with initial capital
Total Returns
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Alpha
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Beta
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Sharpe
--
Sortino
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Max Drawdown
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Benchmark Returns
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Volatility
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Returns 1 Month 3 Month 6 Month 12 Month
Alpha 1 Month 3 Month 6 Month 12 Month
Beta 1 Month 3 Month 6 Month 12 Month
Sharpe 1 Month 3 Month 6 Month 12 Month
Sortino 1 Month 3 Month 6 Month 12 Month
Volatility 1 Month 3 Month 6 Month 12 Month
Max Drawdown 1 Month 3 Month 6 Month 12 Month
# Backtest ID: 578f91d5113e730fb978bec9
There was a runtime error.
2 responses

Here is an update to this metric. Still a big gap between the quantity of dividend growth stocks and the quantity of those companies that are decreasing the supply of shares outstanding.

Clone Algorithm
3
Loading...
Backtest from to with initial capital
Total Returns
--
Alpha
--
Beta
--
Sharpe
--
Sortino
--
Max Drawdown
--
Benchmark Returns
--
Volatility
--
Returns 1 Month 3 Month 6 Month 12 Month
Alpha 1 Month 3 Month 6 Month 12 Month
Beta 1 Month 3 Month 6 Month 12 Month
Sharpe 1 Month 3 Month 6 Month 12 Month
Sortino 1 Month 3 Month 6 Month 12 Month
Volatility 1 Month 3 Month 6 Month 12 Month
Max Drawdown 1 Month 3 Month 6 Month 12 Month
# Backtest ID: 57e56cd70315eb102a3b8a72
There was a runtime error.

Update - I think the new Morningstar data was not populated when I originally produced these metrics. The correlation holds strong with this new backtest:

Clone Algorithm
1
Loading...
Backtest from to with initial capital
Total Returns
--
Alpha
--
Beta
--
Sharpe
--
Sortino
--
Max Drawdown
--
Benchmark Returns
--
Volatility
--
Returns 1 Month 3 Month 6 Month 12 Month
Alpha 1 Month 3 Month 6 Month 12 Month
Beta 1 Month 3 Month 6 Month 12 Month
Sharpe 1 Month 3 Month 6 Month 12 Month
Sortino 1 Month 3 Month 6 Month 12 Month
Volatility 1 Month 3 Month 6 Month 12 Month
Max Drawdown 1 Month 3 Month 6 Month 12 Month
# Backtest ID: 58f0317f000a3364496bf56b
There was a runtime error.