Geopolitical uncertainty tied to Middle East tensions continues to shape investor sentiment, pushing many to seek more stable sources of returns.
BNN Bloomberg spoke with Fiona Wilson, senior portfolio manager at Guardian Capital LP, about why dividend growth — supported by AI-driven analysis — is becoming a key focus for portfolio construction.
Key Takeaways
- Dividend growth is seen as a key indicator of company quality, backed by earnings strength and long-term financial discipline.
- Investors are prioritizing sustainable dividend growth over high yields, which are often associated with weaker fundamentals.
- AI tools are increasingly used to forecast dividend and earnings trends, helping investors avoid companies at risk of cutting payouts.
- Technology and industrial companies are emerging as strong dividend growers, supported by AI investment and onshoring trends.
- Firms tied to data centres, cloud computing and advanced manufacturing are benefiting from structural growth that supports rising dividends.
Read the full transcript below:
ANDREW: Right, so there is hope among some investors that these talks between the U.S. and Iran, when and if they resume, will push toward an end to the Persian Gulf conflict. Markets up a little bit today. We’re joined by Fiona Wilson, senior portfolio manager at Guardian Capital LP. Thanks for joining us.
FIONA: Thanks for having me here today, Andy.
ANDREW: We talk about AI a lot and massive spending plans, but you’re here to remind us that dividend growth is a crucial driver of returns for investors.
FIONA: Yes, exactly. We look at dividend growth as a total return approach. I’m a portfolio manager on the global dividend portfolio, and we don’t go for yield. We’re not looking for the highest-yielding company because they often are lower quality. So we believe looking at dividend growth going forward one year is where you want to be, because it needs to have earnings growth behind it to back that up.
ANDREW: It’s interesting. I’m just wondering, there are tools available for investors, but it can be labourious to filter out which companies have been good dividend growers.
FIONA: Well, you can always look at history, but history doesn’t always predict the future, and that’s what’s happening now in the market. So we’ve actually been using artificial intelligence to forecast dividend growth since 2018, so we’re kind of on the forefront of AI with investing. Now everyone’s talking about using AI for investing, but we have a team of engineers and our own proprietary tools. We forecast dividend growth going forward one year, as well as dividend cuts, earnings growth and earnings cuts. If you look at COVID, more than 300 companies cut their dividends globally, and we navigated that because of the AI. We moved out of positions that later cut their dividends. It really increases your accuracy as a dividend manager, because the last thing you want is a company cutting its dividend.
ANDREW: Your first idea is Amphenol, APH on the New York Stock Exchange, a supplier of electrical equipment.
FIONA: Yes, they do electrical and fibre optics. It’s part of the supply chain for AI. They have really strong dividend growth. They’ve increased their dividend in the past year by about 30 per cent. Again, not a high yielder, because we’re focusing on dividend growth and earnings growth. Data centres are one of their main customers, but they’re also in aerospace and defence, so that diversifies their earnings. They’re a really strong company, and we like them. They’re in the information technology sector.
ANDREW: Parker Hannifin, a long-standing U.S. industrial company, big in the motion and control market.
FIONA: Yes, exactly. The industrial space is taking on renewed interest as we see U.S. onshoring. During COVID, supply chain disruptions led to a lot of discussion about onshoring, and now with new political dynamics in the U.S., that trend is accelerating. This is a great company to look at. They deal with valves and smaller components, but they also incorporate AI. For example, in hydraulics, they use AI to monitor machines, send information back to machine learning systems and predict failures before they happen. That helps avoid supply chain disruptions. They raised their dividend as of yesterday by 11 per cent, and they’ve increased dividends consistently for more than 70 years. Again, this supports focusing on earnings growth alongside dividend growth rather than just high yield.
ANDREW: I’m not sure if we showed Parker Hannifin there, but that’s interesting. Did you say they’ve been increasing the dividend for 70 years?
FIONA: Yes, they have a long dividend history, but again, not a high yield. It’s about 0.82 per cent as of yesterday based on the share price.
ANDREW: I guess retail investors could try using AI to screen for dividend growers. You have to be careful — publicly available tools can hallucinate, but they can provide a starting point.
FIONA: Yes, I don’t know of specific tools available to the public, because we use a random forest algorithm that we’ve built, with about 2,000 iterations per stock per day. We take the average of those iterations because we find it very accurate. There may be tools out there, but I’m not sure about their accuracy.
ANDREW: Broadcom — not typically thought of as a dividend stock, but the dividend is part of the appeal.
FIONA: Yes. Information technology isn’t a high-yielding sector, but it does have strong earnings and dividend growth, so we focus on it. Broadcom used to yield close to three per cent in 2022, but now it’s just under one per cent because the stock has risen so much. It’s also diversified with a software segment, which reduces volatility compared with pure semiconductor exposure. It grows its dividend at roughly 15 per cent annually and is one of our stronger holdings in technology.
ANDREW: We’re tight for time, but Alphabet also has an attractive dividend policy?
FIONA: Yes. Alphabet started paying dividends in 2024, which is part of a broader trend in the sector. It’s actually classified in the communication services sector. There’s more to it than search — cloud is a major growth driver. It increased its dividend by about 30 per cent over the past year. Again, not a high yield, but strong cash flow supports a total return approach. It also opens the stock to more investors looking for dividend-paying companies.
ANDREW: Fiona, thanks very much indeed.
FIONA: Thanks very much for having me, Andy.
ANDREW: Fiona Wilson, senior portfolio manager at Guardian Capital LP.
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This BNN Bloomberg summary and transcript of the April 24, 2026 interview with Fiona Wilson are published with the assistance of AI. Original research, interview questions and added context was created by BNN Bloomberg journalists. An editor also reviewed this material before it was published to ensure its accuracy and adherence with BNN Bloomberg editorial policies and standards.
