Build Your Portfolio by Buying What You Know: Coach, Inc. (COH) and More

…Or for dividend investors
No stranger to leveraging its own lucrative licenses and trademarks, toy maker Hasbro, Inc. (NASDAQ:HAS) personifies a sustainable business. At one point or another, it’s likely that you, your children, or grandchildren have played with Mr. Potato Head, Transformers, or My Little Ponies. And paying nearly a 4% dividend, Hasbro is a solid income investment that boasts a history of payout ratio increases and plenty of room to boost its dividendfor years.

Eventually, those same My Little Ponies get passed down to future generations, given away, or simply thrown out. That’s where Waste Management, Inc. (NYSE:WM) comes in. North America’s largest trash company boasts a huge competitive advantage due to the regulatory hurdles involved in opening new landfills. The company recently posted a very slight uptick in revenue growth, but that’s expected to pick up as construction volumes improve. While you wait for the recovery, you can collect a tidy 4% dividend.

Foolish bottom line
Of course, familiarly with a company’s goods and services doesn’t solely warrant its stock being a good investment. Don’t blindly let your approval of a company’s products drive investing decisions. Pay attention to any red flags — like a pattern of declining sales or eroding margins — when conducting your research.

Based on my own legwork, I’m most excited about Waste Management. It boasts a strong economic moat, and I like its future growth prospects. But don’t take my word for it. Do your research, and start building your portfolio with one of these stocks today.

The article Build Your Portfolio by Buying What You Know originally appeared on Fool.com and is written by Nicole Seghetti.

Fool contributor Nicole Seghetti has no position in any stocks mentioned. You can follow her on Twitter @NicoleSeghetti. The Motley Fool recommends Coach, Hasbro, Panera Bread, and Waste Management. The Motley Fool owns shares of Coach, Hasbro, Panera Bread, and Waste Management.

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