Monday, February 15, 2010

Four Prominent Dividend Growth Stocks with rising yields on cost

February seems to be a big month for dividend increases so far. Especially intriguing are ones about companies which continue their long history of dividend increases, which in some cases stretch over half of a century. The four prominent dividend growth stocks raising their distributions over the past week include United Technologies (UTX), 3M Company (MMM), Diebold (DBD) and PepsiCo (PEP).

United Technologies Corporation (UTX) provides technology products and services to the building systems and aerospace industries worldwide. The company’s board of directors raised its quarterly dividend by 10.40% to 42.50 cents/share. This dividend achiever has raised distributions for seventeen years in a row. The stock currently yields 2.60%. (analysis)

3M Company (MMM), together with its subsidiaries, operates as a diversified technology company worldwide. It operates in six segments: Industrial and Transportation; Health Care; Safety, Security and Protection Services; Consumer and Office; Display and Graphics; and Electro and Communications. The company announced a 3% boost in its quarterly dividend to 52.50 cents/share. This is the 52nd consecutive annual increase for this dividend aristocrat. The stock currently yields 2.60%.(analysis)

PepsiCo, Inc. (PEP) manufactures, markets, and sells various snacks, carbonated and non-carbonated beverages, and foods worldwide. The company raised its quarterly dividend by 6% to 45 cents/share. This is the thirty-eight consecutive dividend increase for this dividend aristocrat. The stock currently yields 3%. (analysis)

Diebold, Incorporated (DBD) engages in the development, manufacture, sale, installation, and service of automated self-service transaction systems, electronic and physical security systems, and election systems and software worldwide. The company’s board of directors announced a 3.80% increase in its quarterly dividends to 27 cents/share. This marked the 57th consecutive annual increase for this dividend champion. The stock currently yields 3.80%.

At this moment only PepsiCo (PEP) seems attractively valued for my account. Diebold (DBD) does not seem to be covering its dividend from earnings, while United Technologies (UTX) and 3M (MMM) do not yield enough. Another problem with 3M is that the company not only yields only 2.60%, but has raised its dividend only nominally over the past several years. With United Technologies (UTX) at least you have some decent dividend growth.

Full Disclosure: Long MMM, PEP, UTX

Relevant Articles:

- Twenty Dividend Increases in the news
- Twelve Dividend Stocks Increasing Dividends
- Dividend Investors are getting paid for waiting
- Dividend Growth beats Dividend Yield in the long run

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