According to Ned Davis Research, $100 invested in all dividend payers of the S&P 500 index in 1972, would have grown to $2,266 by the end of 2009. The same $100 invested in non-dividend paying stocks in the S&P 500 returned a negative 39% over the same period. The performance of dividend payers and initiators was even better, returning $2,945 on the initial investment in 1972. Dividend investors should utilize every edge they could find in order to deliver above average total returns. As a result, the findings of the Ned Davis study should not be ignored. The reason why dividend growers outperform is that they represent an elite group of companies which grow earnings, reinvest some of it in the business, and distribute the rest to stockholders. Rising profits equal rising stock prices over the long run, and rising dividends as well.
Some of the companies which raised distributions over the past week include:
The Clorox Company (CLX) engages in the production, marketing, and sales of consumer products in the United States and internationally. The company raised dividends by 10% to 55 cents/share. This was the thirty-third consecutive year of dividend increases for this dividend aristocrat. The stock yields 3.40%. (analysis)
First Financial Corporation,(THFF) through its subsidiaries, provides various financial services in Indiana and Illinois. The company raised its semi-annual dividend by 2.20% to 46 cents/share. This dividend achiever has managed to increase dividends to shareholders for 22 consecutive years. The stock yields 3.20%.
Bunge Limited (BG) engages in the agriculture and food businesses worldwide. The company approved a 9.5% increase in the company's regular quarterly cash dividend, from $0.21 to $0.23 per share. The company, which is a member of the international dividend achievers, has consistently raised dividends since 2003. The stock yields 1.90%.
Transatlantic Holdings, Inc. (TRH), through its subsidiaries, offers reinsurance capacity for a range of property and casualty products, directly and through brokers, to insurance and reinsurance companies, in domestic and international markets. The dividend was raised by 5% to 21 cents/share. The Board of Directors has raised the quarterly distributions of this dividend achiever every year since TRH became a public company in 1990. The stock yields 1.80%.
Canadian Pacific Railway Limited (CP), through its subsidiaries, provides rail and intermodal freight transportation services. The company increased its next quarterly dividend to 27 Cents/share from 24.75 cents per share. This international dividend achiever has consistently raised distributions since 2004. The stock yields 1.90%.
Republic Bancorp, Inc. (RBCAA) operates as the holding company for Republic Bank & Trust Company and Republic Bank, which provides banking, tax refund solutions, and mortgage banking services to individuals and businesses in the United States. The company announced an 8% increase in the Company’s second quarter cash dividends to $0.143 per share. This dividend achiever has consistently raised dividends since 1999. The stock yields 2.30%
Dr Pepper Snapple Group, Inc. (DPS) operates as a brand owner, manufacturer, and distributor of non-alcoholic beverages in the United States, Canada, Mexico, and the Caribbean. The company raised its quarterly dividend by 67% to 25 cents/share. This was the first dividend increase since the company initiated a dividend payment policy in 2009. The stock yields 2.60%.
Nordstrom, Inc., (JWN) is a fashion specialty retailer, which offers apparel, shoes, cosmetics, and accessories for women, men, and children in the United States. The company announced that its board of directors declared a quarterly dividend of $0.20 per share, an increase of 4 cents or 25% over the previous quarter’s dividend. This was the first dividend increase since 2008.The stock yields 2.10%.
W.R. Berkley Corporation (WRB), operates in the property casualty insurance business in the United States and internationally. The company increased its cash dividend to an annual rate of 28 cents per share, representing a 17% increase from the present rate. The company’s annual dividends have increased for 5 years in a row. The stock yields 4.20%.
Knight Transportation, Inc. (KNX), together with its subsidiaries, operates as a short to medium-haul truckload carrier of general commodities in the United States. The company raised distributions by 20% to 6 cents/share. The company has consistently raised dividends since 2004. The stock yields 1.20%.
Analog Devices, Inc. engages in the design, manufacture, and marketing of analog, mixed-signal, and digital signal processing integrated circuits used in industrial, communication, computer, and consumer applications. The company’s Board of Directors increased quarterly dividend by 10% to $0.22 per share. The company’s annual dividends have increased every year since 2004. The stock yields 3.10%.
Tiffany & Co.(TIF), through its subsidiaries, engages in the design, manufacture, and retail of fine jewelry. Its jewelry products include gemstone jewelry, gemstone band rings, diamond rings, wedding bands for brides and grooms, non-gemstone, gold or platinum jewelry, and sterling silver jewelry. The company announced a 25% increase in its quarterly dividend from $0.20 to $0.25/share. This is the second announced increase in the quarterly dividend payment policy since the start of the calendar year. The company’s annual dividend has increased every year since 2003. The stock yields 2.30%.
Ship Finance International Limited (SFL) , through its subsidiaries, owns and operates vessels and offshore related assets in Bermuda, Cyprus, Malta, Liberia, Norway, the United States, Singapore, the United Kingdom, and the Marshall Islands. The company raised distributions by 10% to 33 cents/share. Before you get too excited about the current yield of 7.30%, please bear in mind that the current dividend is half what it were in Q3 2008.
Unum Group (UNM), together with its subsidiaries, provides group and individual disability insurance products primarily in the United States and the United Kingdom. The company announced that its Board of Directors authorized an increase of 12.1% in the quarterly dividend to 9.25 cents/share. The stock yields 1.60%.
Ashland Inc. (ASH)operates as a specialty chemicals company internationally. The company raised annual distribution by 100% to 60 cents/share. The stock yields 1.10%.
Safeway Inc.(SWY), together with its subsidiaries, operates as a food and drug retailer in North America. The company approved a 20% increase in its quarterly dividend from $0.10 per share to $0.12 per share. This is the sixth consecutive annual dividend increase for the company. The stock yields 2%.
Xcel Energy Inc.,(XEL) through its subsidiaries, engages in the generation, purchase, transmission, distribution, and sale of electricity to residential, commercial, industrial, and public authorities in the United States. The board of directors raised the quarterly dividend on the company’s common stock from $0.245 per share to $0.2525 per share. The company has raised distributions for 7 consecutive years. The stock yields 4.80%.
Northrop Grumman Corporation (NOC) provides products, services, and integrated solutions in the aerospace, electronics, information and services, and shipbuilding sectors. The company raised distributions by 9.30% to 47 cents/share for a seventh consecutive year. The stock yields 3%.
Full Disclosure: Long CLX
This article was featured on Carnival of Personal Finance #259: Memorial Day Edition
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