Monday, November 7, 2011

Ten Income Stocks Providing an Inflation Adjusted Stream of Income to Shareholders

Inflation is one of the major risks that retirees face when living off their nest eggs. The general increase of prices over time would leave retirees on fixed incomes scrambling to make ends meet in the decades since they left the workforce. Dividend growth stocks are one of the few asset classes available to investors to provide a stream of income that generally grows over time. For example, between 1920 and 2005 the dividends paid by the companies included in the Dow Jones Industrials Index (DIA) increased by 5.60% per year, which was more than the 3% annual inflation rate during the period.

Over the past week, ten reliable dividend stocks kept the tradition of rewarding their shareholders with higher inflation adjusted stream of income. The companies include:

Emerson Electric Co. (EMR) operates as a diversified manufacturing and technology company. The company engages in appliance solutions, climate technologies, industrial automation, motor technology, network power, process management, professional tools, and storage solutions businesses. This dividend aristocrat raised quarterly distributions by 15.90% to 40 cents/share. This marked the 55th consecutive annual dividend increase for the company. There are ten companies in the world which have managed to raise dividends for more than 5 decades. Yield: 3.30% (analysis)

Archer-Daniels-Midland Company (ADM) procures, transports, stores, processes, and merchandises agricultural commodities and products in the United States and internationally. This dividend aristocrat raised quarterly distributions by 9.40% to 17.50 cents/share. This marked the 37th consecutive annual dividend increase for the company. Yield: 2.40% (analysis)

Questar Corporation (STR) operates as an integrated natural gas holding company. This dividend aristocrat raised quarterly distributions by 6.60% to 16.25 cents/share. This marked the 33rd consecutive annual dividend increase for the company. Yield: 3.50%

Mercury General Corporation (MCY) , together with its subsidiaries, engages in writing private passenger and commercial automobile insurance in the United States. This dividend achiever raised quarterly distributions by 1.70% to 61 cents/share. This marked the 25th consecutive annual dividend increase for the company. Yield: 5.80%

Microchip Technology Incorporated (MCHP) engages in the design, development, manufacture, and market of semiconductor products for embedded control applications. This dividend achiever raised quarterly distributions to 34.80 cents/share. This marked the 10th consecutive annual dividend increase for the company. Yield: 3.90%

Lincoln Electric Holdings, Inc. (LECO), through its subsidiaries, manufactures welding and cutting products worldwide. This dividend achiever raised quarterly distributions by 9.70% to 17 cents/share. This marked the 17th consecutive annual dividend increase for the company. Yield: 1.80%

DeVry Inc.(DV), together with its subsidiaries, provides educational services worldwide. This dividend stock raised quarterly distributions by 9.40% to 17.50 cents/share. This marked the 6th consecutive annual dividend increase for the company. Yield: 0.80%

Aaron’s, Inc. (AAN) operates as a specialty retailer of consumer electronics, computers, residential furniture, household appliances, and accessories in the United States and Canada. This dividend stock raised quarterly distributions by 15.40% to 1.50 cents/share. This marked the 7th consecutive annual dividend increase for the company. Yield: 0.20%

Exterran Partners, L.P. (EXLP) provides natural gas contract operations services to customers in the United States. This master limited partnership raised quarterly distributions to 48.75 cents/share. Exterran Partners has raised distributions for 5 years in a row. Yield: 7.90%

Noble Corporation (NE) operates as an offshore drilling contractor for the oil and gas industry worldwide. This dividend stock raised quarterly distributions by 16.90% to 15.20 cents/share. This marked the 8th consecutive annual dividend increase for the company. Yield: 1.70%

The dividend increases of these companies certainly beat the pension raises that Social Security has provided over the past few years.

Full disclosure: Long EMR, ADM


Relevant Articles:

- How much money do you really need to retire with dividend stocks?

2 comments:

  1. Do you have any positions in the medical industry?

    ReplyDelete
  2. This is a nice article. I own ADM as food demand is leading to food inflation that you can see on your grocery bill.

    ReplyDelete

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