2 World-Beater Dividend Blue-Chips For A Rich Retirement

You’re not alone if you’re confused and frustrated by this market’s wild gyrations. The world’s most accurate blue-chip economist firms can’t agree on what the stock market will do next.

• JPMorgan (JPM) thinks inflation will come down quickly, the Fed will pivot, and stocks will be at record highs by the end of the year
• Morgan Stanley (MS) is telling clients to go to cash because a 30% sell-off is likely this year
• Goldman Sachs (GS) thinks stocks are still a 25% plunge away from their final bottom

Each blue-chip firm has a reasonable argument for why we’re likely in for stock market hell or heaven, so here’s what smart long-term investors should do.

Remember that in the short-term stock returns are almost all luck. In fact, over 1-year luck is 33X as powerful as fundamentals.

But over the long-term, 30+ years, fundamentals are 33X as powerful as luck.

In the short-term, returns are a crap shoot; in the long run, they are fundamentals-driven destiny.

Will stocks rise or fall in the next year? No one really knows. What will they do in the next 3 years? The next 10 years? The answer is almost certainly go up…a lot.

Whether or not we get a recession in 2023 or stocks fall another 30% or have already bottomed doesn’t matter. Because 10 years from now, anyone buying blue-chip bargains today will feel like a stock market genius that bought the bottom.

So let me show you why Allianz (OTCPK:ALIZY) and Cummins (CMI) are two world-beater blue-chips that have minted millionaires for over a century and could be your ticket to retiring in safety and splendor in the coming years and decades.

Allianz: The World’s Best Insurance Company

• Consider 6.3% Yielding Allianz, The World’s Best-Run Insurance Company

Full Deep Dive On Taiwan Allianz: Growth Prospects, Investment Thesis, Risk Profile, Valuation Profile, and Long-Term Total Return Potential

• 26.375% dividend tax withholding
• you need to own it in a taxable account to get the tax credit and recoup the withholding

Great insurance companies make investors rich through managing risk well, and according to rating agencies, Allianz, the world’s largest insurance company, is the best risk manager in its industry.

ALIZY Credit Ratings

Rating Agency	Credit Rating	30-Year Default/Bankruptcy Risk	Chance of Losing 100% Of Your Investment 1 In
S&P	AA Stable Outlook	0.51%	196.1
Fitch	AA- Stable Outlook	0.55%	181.8
Moody’s	A+ (A+ equivalent) Stable Outlook	0.60%	166.7
AMBest	Aa3 (AA- equivalent) Stable	0.55%	181.8
Consensus	AA- Stable Outlook	0.55%	181.0

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(Source: S&P, Fitch, AMBest, Moody’s)

And it’s not just credit ratings showing ALIZY’s risk management power.

ALIZY Long-Term Risk-Management Consensus

Rating Agency	Industry Percentile	Rating Agency Classification
MSCI 37 Metric Model	100.0%	AAA Industry Leader, Stable Trend
Morningstar/Sustainalytics 20 Metric Model	91.6%	16.7/100 Low-Risk
Reuters’/Refinitiv 500+ Metric Model	99.4%	Excellent
S&P 1,000+ Metric Model	89.0%	Excellent, Stable Trend
FactSet	50.0%	Average, Negative Trend
Morningstar Global Percentile (All 15,000 Rated Companies)	86.2%	Very Good
Consensus	86.0%	Low-Risk, Very Good Risk-Management, Stable Trend

Click to enlarge

(Sources: MSCI, Morningstar, FactSet, S&P, Reuters)

The most recent fallout from the Alpha Fund scandal has lowered ALIZY’s risk-management consensus from 87% to 86%, which is still very good. How good?

ALIZY’s Long-Term Risk Management Is The 21st Best In The Master List (96th Percentile)

Classification	Average Consensus LT Risk-Management Industry Percentile	Risk-Management Rating
S&P Global (SPGI) #1 Risk Management In The Master List	94	Exceptional
Allianz	86	Very Good
Strong ESG Stocks	78	Good – Bordering On Very Good
Foreign Dividend Stocks	75	Good
Ultra SWANs	71	Good
Low Volatility Stocks	68	Above-Average
Dividend Aristocrats	67	Above-Average
Dividend Kings	63	Above-Average
Master List average	62	Above-Average
Hyper-Growth stocks	61	Above-Average
Monthly Dividend Stocks	60	Above-Average
Dividend Champions	57	Average bordering on above-average

Click to enlarge

(Source: DK Research Terminal)

ALIZY’s risk-management consensus is in the top 4% of the world’s highest quality companies and similar to that of such other blue-chips as

• Colgate-Palmolive (CL) – dividend king Ultra SWAN

• Ecolab (ECL) – dividend aristocrat Super SWAN

• W. W. Grainger (GWW) – dividend king Ultra SWAN

• AbbVie (ABBV) – dividend king Ultra SWAN

• Lowe’s (LOW) – dividend king Ultra SWAN

• Microsoft (MSFT) – Ultra SWAN

• Prologis (PLD) – Super SWAN

• Equinix (EQIX) – Ultra SWAN

• BlackRock (BLK) – Ultra SWAN

• Adobe (ADBE) – Ultra SWAN

This is truly a world-beater insurance titan you can trust with your hard-earned money, just as you can its risk-management peers.

Reasons To Potentially Buy Allianz Today

Metric	Allianz
Quality	92% 12/13 Super SWAN
Risk Rating	Very Low
DK Master List Quality Ranking (Out Of 500 Companies)	51
Quality Percentile	90%
Dividend Growth Streak (Years)	2
Dividend Yield	6.60%
Dividend Safety Score	92% Very Safe
Average Recession Dividend Cut Risk	0.5%
Severe Recession Dividend Cut Risk	1.25%
S&P Credit Rating	AA Stable
30-Year Bankruptcy Risk	0.51%
Consensus LT Risk-Management Industry Percentile	86% Very Good, Risk-Management
Fair Value	$22.28
Current Price	$17.20
Discount To Fair Value	23%
DK Rating	Potentially Strong Buy
Price To Book Value	1.1 Vs. 1.36 historical fair value
LT Growth Consensus/Management Guidance	6.0%
5-year consensus total return potential	19% to 23% CAGR
Base Case 5-year consensus return potential	20% CAGR (4X the S&P 500)
Consensus 12-month total return forecast	63%
Fundamentally Justified 12-Month Return Potential	36%
LT Consensus Total Return Potential	12.6%
Inflation-Adjusted Consensus LT Return Potential	10.4%
Consensus 10-Year Inflation-Adjusted Total Return Potential (Ignoring Valuation)	2.68
LT Risk-Adjusted Expected Return	8.78%
LT Risk-And Inflation-Adjusted Return Potential	6.56%
Conservative Years To Double	10.98

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(Source: Dividend Kings Zen Research Terminal)

Analysts expect ALIZY to deliver 63% total returns in the next year, and up to 36% would be justified by its growth, dividends, and a return to historical fair value.

Allianz 2024 Consensus Total Return Potential

If ALIZY grows as expected and returns to historical fair value (10.3X earnings and 1.3X book value), investors will earn 75% total returns or 27% annually.

• literally Buffett-like return potential from the world’s best insurance company

Allianz 2027 Consensus Total Return Potential

Management and analysts expect ALIZY to deliver very strong 12% annual growth through 2027, which could translate into 160% total returns or almost 20% annually.

• Buffett-like return potential for the next five years

Now compare that to S&P 500.

S&P 2024 Consensus Total Return Potential

Analysts expect solid 11% annual returns from stocks through 2024.

S&P 500 2027 Consensus Return Potential

Year	Upside Potential By End of That Year	Consensus CAGR Return Potential By End of That Year	Probability-Weighted Return (Annualized)	Inflation And Risk-Adjusted Expected Returns
2027	45.94%	7.85%	5.89%	3.62%

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(Source: DK S&P 500 Valuation And Total Return Tool)

But just 8% annual return through 2027.

• ALIZY offers over 3X the return potential of the S&P through 2024
• and 4X better return potential over the next five years

ALIZY Investment Decision Score

ALIZY is as close to a perfect high-yield Ultra SWAN as exists on Wall Street for anyone comfortable with its risk profile.

• 23% discount vs. 6% market premium = 27% better valuation
• 6.6% yield vs. 1.6% yield (4X higher and safer)
• 22% better consensus long-term return potential
• 3X better risk-adjusted expected return over the next five years
• 4X higher 5-year income potential than the S&P 500

Cummins: The Global Engine Master Is Learning New Tricks

• 3 Reasons Cummins Is A Classic Buffett-Style ‘Fat Pitch’ Blue-Chip Bargain

Full Deep Dive On Cummins: Growth Prospects, Investment Thesis, Risk Profile, Valuation Profile, and Long-Term Total Return Potential

What makes Cummins a world-beater?

We think Cummins will continue to be the top supplier of truck engines and components, despite increasing emissions regulation from government authorities. For over a century, the company has been the pre-eminent manufacturer of diesel engines, which has led to its place as one of the best heavy- and medium-duty engine brands. Cummins’ strong brand is underpinned by its high-performing and extremely durable engines. Customers also value Cummins’ ability to enhance the value of their trucks, leading to product differentiation.” – Morningstar

Cummins has spent over 100 years earning a reputation for quality and helping companies meet ever stricter emissions requirements.

How can I be recommending a diesel engine maker when the world is shifting to electric vehicles and green energy?

Because Cummins is throwing its proven R&D skills and heft behind the green technology of the future.

It’s an industry leader in hydrogen production, and McKinsey estimates it could be a $3.5 trillion global market by 2030.

It’s working on fuel cells and battery systems so it can help its customers electrify everything, including buses, trucks, trains, and construction equipment.

Credit rating agencies rate CMI A+ stable. This means a 0.6% 30-year bankruptcy risk, agreeing with management and the 24 analysts that cover CMI on Wall Street, that CMI will successfully pivot to a green energy future that involves no diesel engines.

Do you know who else agrees that CMI has a bright future?

The bond market is the “smart money” on Wall Street, 100% focused on preservation of capital and risk management. The bond market is so confident in CMI’s future that they are willing to lend it money out to 2098, 76 years, at a reasonable 5.7% interest rate.

Or, to put it another way, the most risk-averse investors in the world are willing to bet millions that CMI will outlive us all.

Do you know who else agrees that CMI can handle all the challenges ahead of it? Six rating agencies we use to measure long-term risk management.

CMI’s Long-Term Risk Management Is The 61st Best In The Master List (88th Percentile)

Classification	Average Consensus LT Risk-Management Industry Percentile	Risk-Management Rating
S&P Global (SPGI) #1 Risk Management In The Master List	94	Exceptional
Cummins	82	Very Good
Strong ESG Stocks	78	Good – Bordering On Very Good
Foreign Dividend Stocks	75	Good
Ultra SWANs	71	Good
Low Volatility Stocks	68	Above-Average
Dividend Aristocrats	67	Above-Average
Dividend Kings	63	Above-Average
Master List average	62	Above-Average
Hyper-Growth stocks	61	Above-Average
Monthly Dividend Stocks	60	Above-Average
Dividend Champions	57	Average bordering on above-average

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(Source: DK Research Terminal)

CMI’s risk-management consensus is in the top 12% of the world’s highest quality companies and similar to that of such other blue-chips as

• AbbVie: Ultra SWAN dividend king
• PepsiCo (PEP): Ultra SWAN dividend king
• W. W. Grainger: Ultra SWAN dividend king
• Bank of Montreal (BMO): Ultra SWAN
• Adobe: Ultra SWAN
• Microsoft: Ultra SWAN

How We Monitor CMI’s Risk Profile

• 24 analysts
• 2 credit rating agencies
• 7 total risk rating agencies
• 31 experts who collectively know this business better than anyone other than management
• and the bond market for real-time fundamental risk analysis

If CMI falters in its pivot to a green energy future, our 31 expert consensus panel will let us know. But for now, the future looks bright for this undervalued Ultra SWAN quality dividend growth blue-chip.

Reasons To Potentially Buy Cummins Today

Metric	Cummins
Quality	91% 13/13 Ultra SWAN
Risk Rating	Very Low
DK Master List Quality Ranking (Out Of 500 Companies)	68
Quality Percentile	87%
Dividend Growth Streak (Years)	17
Dividend Yield	2.80%
Dividend Safety Score	92% Very Safe
Average Recession Dividend Cut Risk	0.5%
Severe Recession Dividend Cut Risk	1.4%
S&P Credit Rating	A+ Stable
30-Year Bankruptcy Risk	0.60%
Consensus LT Risk-Management Industry Percentile	82% Very Good, Risk-Management
Fair Value	$268.53
Current Price	$227.22
Discount To Fair Value	15%
DK Rating	Potentially Strong Buy
PE Ratio	12.8
Cash-Adjusted PE	8.3 Anti-bubble blue-chip
Growth Priced In	-0.4% CAGR
Historical PE Range	14 to 15
LT Growth Consensus/Management Guidance	9.2%
PEG Ratio	90.22
5-year consensus total return potential	10% to 16% CAGR
Base Case 5-year consensus return potential	13% CAGR Vs. 8% S&P 500
Consensus 12-month total return forecast	10%
Fundamentally Justified 12-Month Return Potential	21%
LT Consensus Total Return Potential	12.0% Vs. 10% S&P and 11% Dividend Aristocrats
Inflation-Adjusted Consensus LT Return Potential	9.8%
Consensus 10-Year Inflation-Adjusted Total Return Potential (Ignoring Valuation)	2.54
LT Risk-Adjusted Expected Return	8.35%
LT Risk-And Inflation-Adjusted Return Potential	6.13%
Conservative Years To Double	11.75

Click to enlarge

(Source: Dividend Kings Zen Research Terminal)

CMI 2024 Consensus Total Return Potential

CMI 2027 Consensus Total Return Potential

If CMI grows as expected and returns to historical market-determined fair value, investors could see 13% annual returns not just through 2024 but also almost double their money in the next five years.

• 25% better annual return potential than the S&P through 2024
• 2X better return potential over the next five years

In fact, analysts think CMI could deliver 12% long-term returns for decades to come, similar to the 14% returns it’s been delivering consistently for the last 37 years.

CMI Rolling Returns Since 1985

That means CMI delivered 21X inflation-adjusted returns over the last 37 years, and in the next 30 years, analysts expect 16.5X inflation-adjusted returns.

This wonderful company at a wonderful price, 8.3X cash-adjusted earnings, could change your life and help you retire in safety and splendor.

CMI Investment Decision Score

CMI is a reasonable and prudent anti-bubble Ultra SWAN choice for anyone comfortable with its risk profile.

• 15% discount vs. 7% market premium = 22% better valuation
• 2.8% yield vs. 1.6% yield (and much safer)
• 20% better consensus long-term return potential
• 2X better risk-adjusted expected return over the next five years
• 70% higher 5-year income potential than the S&P 500

Bottom Line: World-Beater Blue-Chip Bargains Are Your Easiest Road To A Rich Retirement

If you want to gamble and try to score a quick 10% to 20% in the stock market, then CNBC and Jim Cramer are for you, in my opinion.

If you want to retire rich and get steadily richer in retirement, turn off Bloomberg and focus on world-beater blue-chips at attractive valuations.

Allianz and Cummins are two global leaders in their respective industries that offer very safe and steadily growing dividends.

They are A-rated or even AA-rated risk-management experts with battle-tested management teams that have proven they can adapt and overcome any and all challenges they are likely to face in the future.

The only guarantee about stock returns in the short-term is that the market will move up, down, or sideways. But if you’re collecting very safe and steadily growing income, you’re being paid to wait out this current economic turmoil.

More importantly, you’re being paid to wait for two of the best risk-management teams in their industries to work hard for you, so that one day you won’t have to.

If you’re tired of praying for luck on Wall Street, turn off Cramer, stop gambling in speculative long-shots, and focus on world-beater blue-chips like ALIZY and CMI.

This is how you can take charge of your financial destiny, make your own luck on Wall Street, and retire in safety and splendor.