Investors have typically concerned themselves about maximizing total returns over time. Total returns are the sum of capital gains and dividends received. Over the past two years markets have produced negative total returns to investors, which is especially troublesome for those who were planning to retire in the coming few years. Instead of focusing on total returns however, future retirees could focus on generating sustainable dividend income from their portfolios, which is much less volatile that capital gains. In fact, over the past decade dividends represented the only income that investors have generated in the markets. In essence, stockholders are “paid for waiting” until their portfolios rebound. Especially valuable are those dividend stocks that not only pay reliable dividends, but also raise them regularly. I have highlighted four such companies, which announced their intentions to reward stockholders with dividend raises:
RPM International Inc. (RPM), which operates as a food company in North America and internationally, increased its quarterly dividend by 2.5% to 20.50 cents per share. RPM International Inc. is a dividend aristocrat, which has raised distributions for 36 consecutive years in a row. The stock currently yields 4.30%.
ConocoPhillips (COP), which is the fourth largest integrated oil and gas company in US, increased its quarterly dividend by 6% to 50 cents per share. This is the ninth consecutive annual dividend increase for ConocoPhillips. The stock currently yields 3.80%.
ONEOK Partners, L.P. (OKS) engages in the ownership and management of natural gas gathering, processing, storage, and interstate and intrastate pipeline assets, as well as natural gas liquids (NGLs) gathering and distribution pipelines. This Master Limited Partnership increased its quarterly distributions by 0.9% to $1.09 per unit. ONEOK Partners has consistently raised distributions only since 2006. The MLP’s units currently yield 8.10%.
"The distribution increase reflects the benefit of our recently completed growth projects, which have increased our fee-based earnings, as well as an improved capital market environment," said John W. Gibson, chairman and chief executive officer of the general partner of ONEOK Partners. "As volumes behind these projects continue to ramp up, we anticipate additional opportunities to increase our distributions in the future."
Reynolds American Inc. (RAI), which operates as a food company in North America and internationally, increased its quarterly dividend by 5.9% to 90 cents per share. Despite the fact that Reynolds American Inc. is not a consistent dividend raiser, it has increased distributions by 132% over the past decade. The stock currently yields 7.70%.
ConocoPhillips (COP) looks like an interesting candidate to add to my watchlist. I would keep current on any events in the company and would look to initiate a position there on dips, provided that such opportunities arise.
Full Disclosure: Long RPM
- 29 stocks with sustainable dividends
- Dividend Aristocrats List for 2009
- Master Limited Partnerships (MLPs)
- Eight Dividend Increases in the news
As we all know, the stock market is at an all time high. That is despite the fact that earnings for the US corporations have been flat for ...
As part of my portfolio monitoring process , I evaluate the list of dividend increases every week. It is helpful to monitor how my investmen...
The ultimate goals of everyone reading this site is to retire wealthy and to stay retired. Financial independence provides flexibility, fre...
Many of you are aware that I have been a big fan of tax-deferred investing over the past three – four years. After my awakening moment in l...
After observing market behavior for 20 years, I have come to the conclusion that many investors do not have a clue about how to make money i...
Right now, many investors are sitting on huge unrealized gains in the companies they have bought years ago. I am in those shoes too. However...
It seems like international investing is all the rage these days. It seems like everywhere I look, someone is recommending investors to add ...
Medtronic plc manufactures and sells device-based medical therapies worldwide. Over the past week, dividend champion Medtronic raised its ...
I do not like it, when my dividend paying companies are acquisition targets. Last week, shares of Hershey (HSY) increased to an all-time ...
General Mills, Inc. (GIS) manufactures and markets branded consumer foods in the United States and internationally. It also supplies branded...