After a slow week for dividend increases last week, eleven companies with strong balance sheets showed enough confidence in their ability to generate sufficient cash flows to substantiate dividend raises. Despite the tough economic conditions the USA is experiencing, these companies still managed to defy the odds and increase their cash dividends. The companies that showed their promise in rewarding stockholders include:
Enterprise Products Partners L.P. (EPD), a midstream energy company, which provides services to producers and consumers of natural gas, natural gas liquids (NGL), crude oil, and petrochemicals, increased its quarterly distributions by 5.60% to 54.50 cents per share. Enterprise Products Partners L.P. is a dividend achiever, which has increased its quarterly dividend in each of the past eleven years. The stock currently yields 7.80%.
A. O. Smith Corporation (AOS), which, increased its quarterly dividend by 2.60% to 19.50 cents per share. A. O. Smith Corporation is a dividend achiever, which has increased its quarterly dividend for 16 consecutive years. The stock currently yields 2.00%.
Harleysville Savings Financial Corporation (HARL), which provides various banking services in southeastern Pennsylvania, boosted its quarterly dividend by 5.60% to 19 cents per share. Harleysville is a dividend achiever, which has increased its quarterly dividend for more than a decade. The stock currently yields 4.90%.
Fastenal Company (FAST), which operates as a wholesaler and retailer of industrial and construction supplies, boosted its semi-annual dividend by 5.70% to 37 cents per share. In addition to that Fastenal’s Board of Directors authorized purchases of up to 2,000,000 shares of its common stock. This authorization replaced any unused authorization previously granted by the Board of Directors. Fastenal Company did not purchase any of its outstanding common stock during the first half of 2009. Fastenal Company is a dividend achiever, which has increased its annual dividends since 1999. The stock currently yields 2.20%.
Ryder System (R), which provides transportation and supply chain management solutions, increased its quarterly dividend by 8.7% to 25 cents per share. Ryder System has regularly increased its quarterly since 2005. The stock currently yields 3.70%.
ONEOK (OKE), which engages in the purchase, transportation, storage, and distribution of natural gas, increased its quarterly dividend to 42 cents per share. ONEOK has increased its quarterly dividend in each of the past 7 years. The company is the general manager behind the master limited partnership Oneok Partners (OKS). The stock currently yields 5.30%.
Unum Group (UNM), which provides group and individual disability insurance products, announced a 10% boost to its quarterly dividend to 8.25 cents per share. This is the first dividend increase for Unum Group since the company slashed its payment in 2003. The stock currently yields 1.80%.
Landstar System (LSTR), which is a non-asset based transportation and logistics services company, providing transportation capacity and related transportation services to shippers, raised its quarterly dividend by 13% to 4.50 cents per share. Landstar System has regularly increased its quarterly dividend in each of the past four years. The stock only yields 0.50%.
Duncan Energy Partners L.P. (DEP), a master limited partnership which engages in gathering, transporting, marketing, and storing natural gas, as well as in transporting and storing natural gas liquids (NGLs) and petrochemicals, increased its quarterly distributions by 3.60% to 43.50 cents per unit. While Duncan Energy Partners L.P. has only been publicly traded since 2007, the partnership has managed to hike distributions at least once per year over the same period. The partnership units currently yield 9.60%.
Healthcare Services Group, Inc. (HCSG), which provides housekeeping, laundry, linen, facility maintenance, and food services to nursing homes, retirement complexes, rehabilitation centers, and hospitals, boosted its quarterly dividend by 6% to 19 cents per share. This was the 24th consecutive quarterly dividend increase for Healthcare Services Group, Inc. The stock currently yields 4.00%.
Anworth Mortgage Asset Corporation (ANH), a mortgage real estate investment trust which invests primarily in securities guaranteed by the U.S. Government, increased its quarterly dividend to 32 cents per share. Anworth generates income for distribution to shareholders primarily based on the difference between the yield on its mortgage assets and the cost of its borrowings. Although the stock currently yields 17.00%, its quarterly distributions have fluctuated between a high of 79 cents/share in 2001 to a low of 2 cents/share in 2005.
I would put Fastenal Company (FAST), A.O. Smith Corporation (AOS), Enterprise Products Partners L.P. (EPD) and Harleysville Savings Financial Corporation (HARL) on my watchlist for further research.
Full Disclosure: None
- Walgreen’s 22% Dividend Increase Analysis
- Master Limited Partnerships (MLPs)
- Why do I like Dividend Achievers
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