Monday, June 10, 2024

Four Dividend Growth Stocks Raising Dividends Last Week

I review the list of dividend increases every week, as part of my monitoring process. This exercise is one of the steps that helps me evaluate existing holdings. It's also one of the touch points that help me potentially identify companies for further research.

This review also helps show the quick ways I go about reviewing a company. That's to decide whether a company should be added to my list for further research or not.

In general, I look for:

1) A long track record of consecutive annual dividend increases. In this case, I am looking for companies that have raised dividends for at least ten years in a row.

2) A history of increasing earnings over the past decade. Rising earnings per share are the fuel behind future dividend increases. 

3) Dividend growth rate versus most recent dividend increase. Dividend increases provide a signaling opportunity into the mind of company management teams. More often than not, it provides clues as to what management teams see happening in the business, before they commit to updating the dividend. They do not make this decision lightly, but rather after evaluating the economy, competition, the business environment and their assessment of how the business would likely perform.

4) I look at trends in dividend payout ratios when evaluating individual companies. It is important to also view trends in dividend payout ratios to determine dividend sustainability and sources of dividend increases.

5) Valuation. That's a tricky concept, which takes into consideration current P/E ratios, dividend growth rates, as well as current yields, payout ratios and earnings growth. Ultimately it also ends up as an exercise in trade-offs as well as opportunity costs.


Over the past week there were four companies that increased dividends and also have a ten year track record of consecutive annual dividend increases. The companies include:


Alexandria Real Estate Equities (ARE) is a REIT which invests in life-science properties in the US.

The REIT increased quarterly dividends by 2.40% to $1.30/share. This is a 5% increase over the dividend paid during the same time last year. This is the 14th year of consecutive annual dividend increases for this dividend achiever. The company has managed to grow dividends at an annualized rate of 7% over the past decade. The five year annualized dividend growth rate is at 6%.

Between 2014 and 2023, FFO/share  increased from $4.42 to $7.19.

The REIT is expected to earn $9.49/share in FFO this year.

The stock sells for 12.10 times FFO and yields 4.45%.


Oil-Dri Corporation of America (ODC) develops, manufactures, and markets sorbent products in the United States and internationally. It operates in two segments, Retail and Wholesale Products Group, and Business to Business Products Group.

The company increased quarterly dividends by 6.90% to $0.31/share. This declaration marks the 21st consecutive year the Company has increased dividends. Over the past decade, this dividend achiever has managed to increase dividends at an annualized rate of 4.30%.

The company has managed to grow earnings from $1.18/share in 2014 to $4.13/share in 2023.

The stock sells for 19.40 times forward earnings and yields 1.65%.


UnitedHealth Group Incorporated (UNH) operates as a diversified health care company in the United States. The company operates through four segments: UnitedHealthcare, Optum Health, Optum Insight, and Optum Rx.

The company increased quarterly dividends by 11.70% to $2.10/share. This is the 15th consecutive annual dividend increase for this dividend achiever. Annualized dividend growth has been decelerating. The ten year annualized dividend growth is at 21.40%, while the 5 year annualized dividend growth is 16.10%.

Between 2014 and 2023 the company managed to grow earnings from $5.78/share to $24.12/share.

The company is expected to earn $27.71/share in 2024.

The stock sells for 17.70 times forward earnings and yields 1.53%.


Universal Health Realty Income Trust (UHT) is a real estate investment trust, which invests in healthcare and human-service related facilities including acute care hospitals, behavioral health care hospitals, specialty facilities, medical/office buildings, free-standing emergency departments and childcare centers. 

The REIT increased its quarterly dividends by 0.70% to $0.73/share. This was the 39th year of consecutive annual dividend increases for this dividend champion. Over the past decade, this REIT has managed to grow dividends at an annualized rate of 1.50%.

FFO/share went up from $2.78/share in 2014 to $3.23/share in 2023.

The stock sells for 11.80 times FFO and yields 7.45%.


Relevant Articles:

Six Companies Increasing Dividends to Shareholders Last Week

Five Dividend Growth Stocks Rewarding Shareholders With Raises Last Week

Fourteen Dividend Growth Stocks Raising Dividends Last Week

15 Dividend Stocks In The News

Thursday, June 6, 2024

Living Off Dividends in Retirement

The goal of every Dividend Growth Investor is to generate enough dividends to pay for their retirement. It takes patience, persistence and perseverance to accumulate that income producing nest egg. But once it is built, and that dividend income covers expenses at the dividend crossover point, work becomes optional.



The neat thing about dividend income is that it has historically increased faster than inflation in the US. While individual companies in a portfolio may cut dividends, the overall portfolio continues to generate more dividends overall, because more companies increase dividends than cut them. 

Dividend Growth Stocks are not just limited to the Dividend Aristocrats, Dividend Kings, Dividend Champions and Dividend Achievers either. I have long claimed that the entire US Stock Market is basically one giant Dividend Growth Stock.

A reader of the blog recently shared an interesting chart with me. He calculated how a $1 Million investment in S&P 500 at the end of 1993 would have done for a retiree. 

The assumption is that the retiree invested $1 Million in S&P 500 fund at the end of 1993. It follows the dividend amounts per year and provides two comparisons. The first scenario is that the dividends are spent. The second scenario basically shows how the portfolio would have grown to, if somehow dividends were not spent but rather reinvested.

While it doesn't take into consideration fees, taxes, and commissions, it is never the less a very interesting review. On the other hand, it is quite possible (and has been in the past) to build a portfolio in a retirement account such as an IRA or 401 (k), and defer taxes.

(Source)

You can see that dividend income increased pretty much every year, with the exceptions of 2000, 2001 and 2009. Those years were associated with major recessions. In general, dividend income rarely declines. This is quite evident if you observe annual dividend income over the past 80+ years.



Around the years that dividend income declined, share prices actually declined by much more.

It's fascinating how dividend income kept increasing year in and year out over the past 30 years, ultimately increasing by a factor of 5 by 2023 from the initial year. 

At the same time, the value of the portfolio increased by a factor of 10. This means that the original $1 Million investment at the end of 1993 turned to a little over $10 million by end of 2023. Or $10,225,812 to be exact. 

Had the investor not spent their dividends however, they would have ended up with $18,176,399. 

On a side note, the reader has a very interesting valuation ratio on the very right of the chart above. It shows how much one needs to invest in S&P 500 in order to get $1 worth of dividends. In effect, it is an inverse dividend yield calculation. For example paying $25 for $1 of dividend income translates into a dividend yield of 4%. You want to pay less for each dollar of dividends in general, all else being equal.

You can note that over the past 30 years, dividend yields on S&P 500 has generally declined by basically half. That means that it takes roughly twice as much capital today as in 1993 to generate the same $30,000 in annual dividends. That's mostly because the dividend yield on S&P 500 today is roughly 1.50% versus roughly 3% in 1993. 

The reason for that decline is because a lot of companies these days pay dividends and also spend much more money on share buybacks. One way to generate that 3% starting yield on investments is through a focus on dividend paying companies. Of course, one also needs to avoid the temptation to chase yield as well. However, many popular dividend ETF's such as the Schwab Dividend 100 (SCHD) yield over 3% today, and have a history of growing dividends. I am actually a firm believer that it is possible to pick and choose my own individual companies in my portfolio, in order to achieve my desired goals and objectives.

Either way, living off dividends in retirement can work well for investors. The chart above shows one example of how it worked in the past, with pretty decent results.

Thank you for reading!

Relevant Articles:




Monday, June 3, 2024

Four Dividend Growth Stocks Increasing Dividends Last Week

I review the list of dividend increases as part of my monitoring process every week. This exercise helps me monitor existing positions. This exercise also helps me potentially identify companies for further research. It is also helpful to showcase the quick drill I do on each company, focusing on the factors that I find most helpful, before putting it on the list for further research or putting it in the "too hard pile".

Over the past week, there were four companies in North America that raised dividends to shareholders and have a ten year track record of consistent annual dividend increases. The companies include:


Donaldson Company, Inc. (DCI) manufactures and sells filtration systems and replacement parts worldwide. The company operates through three segments: Mobile Solutions, Industrial Solutions, and Life Sciences. 

The company increased quarterly dividends by 8% to $0.27/share. This marked the 28th consecutive year of annual dividend increases for this dividend champion. Over the past decade, the company has managed to increase dividends at an annualized rate of 7%.

Between 2014 and 2023, the company managed to grow earnings from $1.79/share to $2.95/share. The company is expected to earn $3.27/share.

The stock sells for 22.50 times forward earnings and yields 1.47%.


Lowe's Companies, Inc. (LOW) operates as a home improvement retailer in the United States. 

The company lifted quarterly dividends by 4.50% to $1.15/share. This is the 62nd consecutive annual dividend increase for this dividend king. It's also much slower than the ten year average annual dividend growth of 20.30%/year.

Between 2014 and 2023, the company managed to grow earnings from $2.71/share to $13.24/share. The company is expected to earn $12.23/share.

The stock sells for 18.10 times forward earnings and yields 2.08%.


National Bank of Canada (NTIOF) (NA.TO) provides financial services to individuals, businesses, institutional clients, and governments in Canada and internationally. It operates through four segments: Personal and Commercial, Wealth Management, Financial Markets, and U.S. Specialty Finance and International. 

The bank raised quarterly dividends by 3.80% to $1.10/share. This is the second dividend increase over the past year, bringing the year over year increase to 7.84%. This is the 15th year of consecutive annual dividend increases for this dividend achiever. The company has increased dividends at an annualized rate of 8.80% over the past decade.

Between 2014 and 2023, the company managed to grow earnings from $4.36/share to $9.47/share.

The bank is expected to earn $10.05/share in 2024.

The stock sells for 11.60 times forward earnings and yields 3.77%. (DGI Note: All Figures for National Bank of Canada are in Canadian Dollars)



Royal Bank of Canada (RY) operates as a diversified financial service company worldwide. 

The company raised quarterly dividends by 2.90% to $1.42/share. This is the second dividend increase over the past year, bringing the year over year increase to 5.19%. This is the 14th year of consecutive annual dividend increases for this dividend achiever. The company has increased dividends at an annualized rate of 8.80% over the past decade.

Between 2014 and 2023, the company managed to grow earnings from $6.03/share to $10.51/share.

The bank is expected to earn $11.58/share in 2024.

The stock sells for 12.87 times forward earnings and yields 3.81%. (DGI Note: All Figures for RY are in Canadian Dollars)


Relevant Articles:

- Six Companies Increasing Dividends to Shareholders Last Week

Five Dividend Growth Stocks Rewarding Shareholders With Raises Last Week

Fourteen Dividend Growth Stocks Raising Dividends Last Week

Thursday, May 30, 2024

Marjorie Bradt - A Hidden Dividend Millionaire

I love reading stories about everyday people, who were able to accumulate wealth with long-term dividend investing.

These stories reiterate how to achieve success with investing:

1. Start early

2. Invest prudently

3. Have patience

4. Give your investments time

5. Let the power of compounding do the heavy lifting

Today's story is from one my favorite books on dividend investing. The book is The Ultimate Dividend Playbook: Income, Insight and Independence for Today's Investor, and it was written by Josh Peters, who was the editor of Morningstar Dividend Investor. 

The story covers Marjorie Bradt, an everyday investor who was gifted some old AT&T stock between 1955 - 1962 from her father. The stock was worth $6,626 then, which was not a small amount of course. But she did not sell it. She signed up for the company's dividend reinvestment plan, and then held on to any spin-offs in the process. 

By 1999, that investment had blossomed into 10 companies, worth more than $1 Million total..

You can read the part about Marjorie Bradt from the book below:

A Role Model

Dividend investors have few heroes, at least as far as you can discover by browsing the bookshelves at Barnes & Noble or reviewing a year's worth of cover stories in Fortune or Business Week. Indeed, dividends may be the most misunderstood aspect of investing in stocks, to the extent people bother to understand dividends at all. Most professionals are indifferent to dividends, and a surprisingly large minority are downright hostile. Even the fans of dividends you might see on TV or read about in a magazine are usually on their way somewhere else, collecting dividends just to kill time while waiting for other opportunities to crop up. True fans, those who understand the critical role of dividends over the long run, are very rare in the professional ranks.

As editor of a monthly newsletter devoted to the topic, Morningstar DividendInvestor, I am one of those rare professionals. And while I admire Warren Buffett, Peter Lynch, Marty Whitman, and many other famously successful and articulate investors as much as anyone, my true hero is—drum roll, please Marjorie Bradt.

Don't spend too much time trying to place her name; she's never been featured on CNBC or mentioned in the Wall Street Journal. She's never written a book about investing or managed a mutual fund. Indeed, the stock market has never even been a hobby of hers. Yet I'm willing to bet that Marjorie's long-term investment record beats the vast majority of investors over the past half century.

I became familiar with Marjorie's remarkable record while working as an assistant to a stockbroker in 1999. Marjorie and her husband, Don, were get- ting their ample estate in order, and they needed cost basis information for their seven-figure portfolio. Given this task, I was handed a folder six inches

thick with old statements, some dating back to the 1950s. The best information I had was their current portfolio, almost all of which consisted of the various corporate descendants of AT&T, the original Ma Bell.

Working backward from what they owned in 1999, I noticed that Marjorie's account was marked by a distinct lack of active management. All she did, it seemed, was reinvest her dividends-quarter after quarter, year after year, decade after decade. When AT&T broke up into a long distance-only carrier and the seven baby Bells, Marjorie held on to all eight stocks. When Southwestern Bell bought Pacific Telesis and Ameritech, she held on. When AT&T went on to spin out Lucent, and US West spun out MediaOne, she held on to those, too.

After more than a day's worth of work, I finally found the root of Marjorie's wealth: a handful of gifts of AT&T stock given to her by her father between 1955 and 1962. Their original value totaled $6,626. Very early on, she signed up for AT&T's dividend reinvestment plan. Instead of getting penny-ante dividend checks every three months, she turned those payments into additional shares, which led to more dividends, and so on. As AT&T prospered and raised its dividend rate, the value of each share rose as well as did the Baby Bells' dividends and share prices. By 1999, this investment had blossomed into a portfolio of ten separate stocks worth more than $1 million—all of them descendants of the original Ma Bell.

I was astounded. Here was all this wealth, but Marjorie hadn't lifted a finger to earn it. She hadn't foreseen the raging inflation of the 1970s, the surge in gold, the run of small caps, then large caps, then small caps again. She didn't predict anything—and she didn't have to. She just held and held, reinvesting every dividend, letting these rising dividend payments do all of the work.

The beauty of Marjorie's experience is its simplicity: Anyone could have done the same, even if virtually no other investors did. No PhD, MBA, or CFA was required; math skills learned in junior high school could suffice. Marjorie didn't have to trouble herself with a market-timing strategy or the pursuit of the next Microsoft. And it isn't as though AT&T was a diamond in the rough in the 1950s; back then the company owned almost every telephone in America. Other companies were growing faster, but millions of investors held stock in Ma Bell, drawn in by the same thing that made AT&T attractive to Marjorie's parents: large, steady, and growing dividends.

Marjorie thus traded the usual investor attempts at prescience for a combination of dividends and patience - and rarely does one find an example of such a richly rewarding investment strategy.



Monday, May 27, 2024

Six Companies Increasing Dividends to Shareholders Last Week

I review the list of dividend increases every week, as part of my monitoring process. I usually focus my attention on the companies with a ten year streak of annual dividend increases, and then review each company using my criteria. I am always on the lookout for new ideas, and to determine if my existing holdings are working. I also want to be ready to act quickly, when the right time arrives.

This exercise helps me to evaluate companies I already own, and see how they are doing. This is a helpful piece of the puzzle, that would be helpful when/if I decide to add to these companies at the right price.


When I review companies, I look at ten year trends in:

1) Earnings per share
2) Dividend payout ratio
3) Dividends per share
4) Valuation

This exercise also helps me identify companies for further research. A large part of the time is spent reviewing companies, screening for companies, and trying to learn more about companies, their business, etc. 

It is not glamorous at all, but dull and boring. 

But it does pay dividends.


During the past week, there were six companies that both raised dividends to shareholders and have a ten year streak of consecutive annual dividend increases. The companies include:

(This of course is just a list, not a recommendation)


Flowers Foods, Inc. (FLO) produces and markets packaged bakery food products in the United States. 

The company increased quarterly dividends by 4.30% to $0.24/share. This is the 22nd consecutive annual dividend increase for this dividend achieverdividend achiever. Over the past decade, the company has managed to raise dividends at an annualized rate of 7.40%

Earnings went from $0.84/share in 2015 to $0.58/share in 2023.

The company is expected to earn $1.22/share in 2024.

The stock sells for 19.20 times forward earnings and yields 4.10%.


Insperity, Inc. (NSP) engages in the provision of human resources (HR) and business solutions to improve business performance for small and medium-sized businesses primarily in the United States.

The company increased quarterly dividends by 5.30% to $0.60/share. This is the 14th consecutive annual dividend increase for this dividend achiever.dividend achiever. Over the past decade, the company has managed to grow dividends at an annualized rate of 20.70%. The pace of dividend growth has been decelerating in the past few years however.

Between 2014 and 2023, Insperity managed to boost earnings from $0.53/share to $4.53/share.

The company is expected to earn $3.65/share in 2024.

The stock sells for 27.47 times forward earnings and yields 2.40%


Lennox International Inc. (LII) designs, manufactures, and markets a range of products for the heating, ventilation, air conditioning, and refrigeration markets in the United States, Canada, and internationally. 

The company raised quarterly dividends by 4.50% to $1.15/share. This is the 15th year of consecutive annual dividend increases for this dividend achiever.dividend achiever. Over the past decade, the company managed to increase dividends at an annualized rate of 17.25%.

Between 2014 and 2023, the company managed to grow earnings from $4.30/share to $16.62/share.

The company is expected to earn $25.25/share in 2024.

The stock sells for 19.90 times forward earnings and yields 0.91%.


LyondellBasell Industries N.V. (LYB) operates as a chemical company in the United States, Germany, Mexico, Italy, Poland, France, Japan, China, the Netherlands, and internationally. The company operates in six segments: Olefins and Polyolefins—Americas; Olefins and Polyolefins—Europe, Asia, International; Intermediates and Derivatives; Advanced Polymer Solutions; Refining; and Technology.

The company raised quarterly dividends by 7.20% to $1.34/share. This is the 13th consecutive annual dividend increase for this dividend achieverdividend achiever. Over the past decade, the company managed to grow dividends at an annualized rate of 9.40%.

Between 2014 and 2023, the company's earnings went from $8.03/share to $6.48/share.

The company is expected to earn $8.27/share in 2024.

The stock sells for 11.90 times forward earnings and yields 5.44%.

Medtronic plc (MDT) develops, manufactures, and sells device-based medical therapies to healthcare systems, physicians, clinicians, and patients worldwide. 

The company eked out a 1.40% increase in its quarterly dividend to $0.70/share. Nevertheless this was the 47th consecutive year of dividend increases for this dividend aristocratdividend aristocrat. The rate of increase was much slower than the ten year annualized dividend growth of 9.75% however.

Earnings went from $2.44/share in 2015 to $2.77/share in 2023.

The company is expected to earn $5.45/share in 2024.

The stock sells for 15.10 times forward earnings and yields 3.40%


Universal Corporation (UVV) processes and supplies leaf tobacco and plant-based ingredients worldwide. The company operates through two segments, Tobacco Operations; and Ingredients Operations. 

The company increased dividends by 1% to $0.81/share. This was the 54th consecutive annual dividend increase for this dividend kingdividend king. Over the past decade, the company managed to increase dividends at an annualized rate of 4.74%.

Between 2015 and 2024, the company managed to slightly boost earnings per share from $4.33 to $4.81.

The company is expected to earn $4.78/share in 2024.

The stock sells for 9.70 times earnings and yields 7.04%.

Popular Posts