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Apr.25
11:51 AM ET
Wednesday, 25 Apr 2007
Dividends Mark Companies With 'Confidence in the Future,' Analyst Says

Jill Evans, portfolio manager for Alpine Dynamic Dividend Fund, told CNBC’s “Morning Call” that investors might want to consider stocks that pay dividends.

“You need to have earnings growth because you need cash flow growth to pay the dividends,” Evans said. “Right now, that’s taking us overseas. We’re seeing a lot of growth from international companies and U.S. companies with international exposure. Also very important to us are companies that are raising their dividends because that’s a signal of confidence in the future.”

Many shun newspaper stocks, but Evans said she likes Gatehouse Media [GHS  Loading...      ()   ], a publisher of local papers in monopoly markets. The company generates solid ad revenue and the company is consolidating to cut costs.

Evans also likes Arrow International [ARRO  Loading...      ()   ], a maker of critical care products for hospitals, including cardiac and kidney dialysis equipment. Evans said an aging population creates a growing market for the company’s products. The company is sending manufacturing overseas to cut costs, margins are improving and it carries no debt.

Evans said California voters recently approved a $10 billion bond for school construction that should benefit McGrath Rentcorp [MGRC  Loading...      ()   ], a make of modular classrooms. The company is also active in Florida and Texas.

© 2009 CNBC.com

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