Monday, February 23, 2015

Twelve Companies Providing Investors with Dividend Raises

One of the ways I monitor my portfolio is to check press releases from dividend growth companies I have on my watchlist or which I own. Over the past week, there were several widely-held dividend growth companies, which raised dividends. I have summarized important information about each company, including rate of increase relative to historical data, current valuation as well as link to my most recent analysis of the company. The companies include:

Colgate-Palmolive Company (CL), together with its subsidiaries, manufactures and markets consumer products worldwide. The company operates in two segments: Oral, Personal and Home Care; and Pet Nutrition. The company raised its quarterly dividend by 5.60% to 38 cents/share. This marked the 52nd consecutive annual dividend increase for this dividend king. In addition, the company approved a $5 billion stock buyback to last for the next 3 – 4 years. The ten year dividend growth rate is 11.50%/year. Currently, the stock is selling for 23.30 times forward earnings and yields 2.20%. Check my analysis of Colgate-Palmolive.

Wal-Mart Stores Inc. (WMT) operates retail stores in various formats worldwide. The company operates through three segments: Wal-Mart U.S., Wal-Mart International, and Sam’s Club. The company delivered a disappointing dividend raise to its quarterly dividend of 2.10% to 49 cents/share. This marked the 42nd consecutive annual dividend increase for this dividend champion. The ten year dividend growth rate is 14.80%/year. However, this is the second year in a row where Wal-Mart raises its dividend by a disappointing 2%. Given this new fact, I will not be adding any new funds to my position in the company. However, I will keep my shares and allocate dividends elsewhere. Patience and low turnover are some of the surprising lessons behind my analysis of historical stock returns. Currently, the stock is selling for 16.90 times forward earnings and yields 2.30%. Check my analysis of Wal-Mart Stores.

The Coca-Cola Company (KO), a beverage company, manufactures and distributes coke, diet coke, and other soft drinks worldwide. The board of directors hiked Coca-Cola’s quarterly dividend by 8.20% to 33 cents/share. This marked the 53rd consecutive annual dividend increase for this dividend king. The ten year dividend growth rate is 9.30%/year. Currently, the stock is selling for 21.10 times forward earnings and yields 3.10%. Check my analysis of Coca-Cola.

T. Rowe Price Group, Inc. (TROW) is a publicly owned asset management holding company. The firm provides its services to individuals, institutional investors, retirement plans, financial intermediaries, and institutions. The board of directors hiked the company’s quarterly dividend by 18.20% to 52 cents/share. In addition, a $2/share special stock dividend will be distributed to shareholders. This marked the 28th consecutive annual dividend increase for this dividend champion. The ten year dividend growth rate is 16.60%/year. Currently, the stock is selling for 17.20 times forward earnings and yields 2.50%. I analyzed T. Rowe Price Group and should be posting an updated analysis soon. Please stay tuned.

Kimberly-Clark Corporation (KMB), together with its subsidiaries, manufactures and markets personal care, consumer tissue, and health care products worldwide. It operates through four segments: Personal Care, Consumer Tissue, K-C Professional, and Health Care. The company raised its quarterly dividend by 4.80% to 88 cents/share. This is the 44th consecutive annual dividend increase for this dividend champion. The ten year dividend growth rate is 8.20%/year. Currently, the stock is selling for 19.40 times forward earnings and yields 3.20%. Check my analysis of Kimberly-Clark Corporation.

Nestlé S.A. (NSRGY), together with its subsidiaries, provides nutrition, health, and wellness products worldwide. The company delivered a disappointing dividend raise to its quarterly dividend of 2.10% to 49 cents/share. This marked the 19th consecutive annual dividend increase for this international dividend achiever. The ten year dividend growth rate is 10.60%/year. Currently, the stock is overvalued at 15.80 times expected and yields 3.05%. At this stage I would see the stock as a hold at best, with dividends going to be reinvested elsewhere. Check my last review Nestle. I will need to refresh it with current data. Please stay tuned.

Genuine Parts Company (GPC) distributes automotive replacement parts, industrial replacement parts, office products, and electrical/electronic materials in the United States, Puerto Rico, the Dominican Republic, Mexico, and Canada. The company increased its quarterly dividend by 7% to 61.50 cents/share. This marked the 59th consecutive annual dividend increase for this dividend king. The ten year dividend growth rate is 6.80%/year. Currently, the stock is selling for 19.90 times forward earnings and yields 2.60%. The company has been on my watchlist for a long time and I should consider initiating a position on dips below 20 times earnings. Check my analysis of Genuine Parts Company.

AbbVie Inc. (ABBV) discovers, develops, manufactures, and sells pharmaceutical products worldwide. The company raised its quarterly dividend from 49 to 51 cents/share. This is the second dividend increase in less than an year – the previous one was from 42 to 49 cents/share. Abbvie was a spin-off from Abbott (ABT), formed in early 2013. The dividend has been increased for 2 years in a row now. The stock is selling for 13.90 times forward earnings and yields 3.30%. When I last analyzed the spin-off in early 2013, I concluded that the stock is a hold. I think I will keep holding on to it for as long as possible.

NextEra Energy, Inc. (NEE), through its subsidiaries, generates, transmits, distributes, and sells electric energy in the United States and Canada. The board of directors hiked Nextera Energy’s quarterly dividend by 6.20% to 77 cents/share. This marked the 21st consecutive annual dividend increase for this dividend achiever. The ten year dividend growth rate is 8.40%/year. Currently, the stock is selling for 18.80 times forward earnings and yields 2.90%. Check my previous analysis of NextEra.

The Sherwin-Williams Company (SHW) is engaged in the development, manufacture, distribution, and sale of paints, coatings, and related products to professional, industrial, commercial, and retail customers worldwide. The company operates in four segments: Paint Stores Group, Consumer Group, Global Finishes Group, and Latin America Coatings Group. The board of directors hiked the company’s quarterly dividend by 21.80% to 67 cents/share. This marked the 37th consecutive annual dividend increase for this dividend champion. The ten year dividend growth rate is 12.50%/year. Currently, the stock is overvalued at 25.90 times forward earnings and yields 0.90%.

Questar Corporation (STR) operates as an integrated natural gas company in the United States. The company raised its quarterly dividend by 10.50% to 21 cents/share. This marked the 36th consecutive annual dividend increase for this dividend champion. The ten year dividend growth rate is 6.10%/year. Currently, the stock is selling for 18.50 times forward earnings and yields 3.50%

Lorillard, Inc. (LO), through its subsidiaries, manufactures and sells cigarettes in the United States. It operates through two segments, Cigarettes and Electronic Cigarettes. The company increased its quarterly dividend by 7.30% to 66 cents/share. Lorillard has been increasing dividends every year since going public in 2008. The stock currently sells for 18.70 times forward earnings and yields 3.90%. I should probably put this stock on my list for further analysis.

I managed to initiate a position in T.Rowe Price (TROW) last week, and will likely add to it some more next week. I also added to Baxter (BAX), and will likely add some more next week as well. The other stock I added to was Kimberly-Clark, mostly to round off my odd-lot at one brokerage.

Full Disclosure: Long CL, WMT, KO, TROW, KMB, NSRGY, ABT, ABBV,

Relevant Articles:

- How to read my weekly dividend increase reports
Dividend Champions - The Best List for Dividend Investors
A long streak of dividend growth is an indication of a business with exceptional fundamentals
The predictive value of rising dividends
Dividend Investing – Science versus Intuition

4 comments:

  1. The proposed buyout of LO by RAI may preclude you from doing further analysis of LO. Market seems to think it will happen.
    Long LO!

    ReplyDelete
  2. Thanks for the heads-up on the increases, DGI.

    ReplyDelete
  3. Thanks for the update! I own some of the companies listed in the post.

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  4. I follow many of these companies and own some too so that's always good news! Glad to see them performing well.

    ReplyDelete

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