Onshoring: General Electric
Dividend Yield: 3.2%
In his article, Kennedy cited a recent September survey showing that 54% of U.S. manufacturers are planning on or considering bringing factory lines back from China — a 17-percentage-point increase from February. While those numbers are the latest proof of the onshoring trend, they are hardly the beginning.
General Electric (GE), for example, has created more than 16,000 American jobs and has built or planned 15 new U.S. factories since 2009. It opened two new assembly lines — the first in 55 years — in legendary Appliance Park earlier this year, and another one is on the way.
And the onshoring megatrend — while often wrapped in a feel-good, star-spangled package — can help the bottom line. The tough reality is that once-cheap foreign wages are rising, along with oil (and thus cargo) costs. Meanwhile, U.S. labor productivity is improving, while cheap and abundant natural gas has lowered the cost of domestic factories.
Diversified giant GE is doing plenty of other things to help the bottom line long-term as well, like bolstering the industrial side of its business. So far, that has helped the stock climb steadily out of the depths of the recession, up almost 200% from the 2009 lows, including more modest 13% gains booked so far this year.
Also, while GE doesn’t exactly have a great reputation among dividend stock investors anymore thanks to its payout cut in 2009, the company has improved its payout mightily since, bringing GE’s current yield to 3.2%. With 10% annual earnings growth is on tap long-term, there’s reason to expect the upward trend for both GE’s stock and dividend to continue.