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
Relevant Articles:
- 29 stocks with sustainable dividends
- Dividend Aristocrats List for 2009
- Master Limited Partnerships (MLPs)
- Eight Dividend Increases in the news
Popular Posts
-
I am a big fan of Warren Buffett, the Oracle of Omaha. His letters to shareholders are an excellent resource for students of value investing...
-
I recently read an interesting paper titled " Which U.S. Stocks Generated the Highest Long-Term Returns? " by prof Hendrik Bessemb...
-
I review the list of dividend increases every single week, as part of my monitoring process. This exercise helps me to monitor existing hold...
-
The Kroger Co. (KR) operates as a retailer in the United States. The company operates supermarkets, multi-department stores, marketplace sto...
-
“Good decisions come from experience. Experience. comes from bad decisions.” - Mark Twain I am a big fan of long-term investing. This ...
-
With Dividend Growth Stocks, when I am wrong, the most I can lose is the amount I invested, minus any dividends I allocated elsewhere. But w...
-
One of my favorite Berkshire Hathaway letters to shareholders is the one from 2013 . It left a very big impression on me, mostly because it ...
-
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 evalu...
-
I review the list of dividend increases every week, as part of my review process. This exercise helps me to monitor existing holdings. It al...
-
The goal of every Dividend Growth Investor is to generate enough dividends to pay for their retirement. It takes patience, persistence and p...