Monday, January 25, 2021

Seven Companies Rewarding Shareholders With a Raise

I review the list of dividend increases as part of my monitoring process. This allows me to see how the companies I own are doing. It also lets me uncover companies for further research.

This process also allows me to share the quick review I make for each company I stumble upon. It provides me with an idea of whether I want to research any further, or move on to other ideas.

In general I look for:

1) At least a ten year track record of annual dividend increases or longer

2) Growing earnings per share

3) Consistent dividend increases

4) Margin of safety to ensure dividend safety

5) Good valuation

During the past week, there were several companies that raised dividends, which also had a ten year track record of annual dividend increases. I will be reviewing them with the five step guidelines above, before deciding if I want to research them any further.

The companies raising dividends last week include:

Fastenal Company (FAST) engages in the wholesale distribution of industrial and construction supplies in the United States, Canada, Mexico, North America, and internationally. It offers fasteners, and related industrial and construction supplies under the Fastenal name.

The company raised its quarterly dividends by 12% to 28 cents/share. This marked the 22nd consecutive annual dividend increase for this dividend achiever. Over the past decade, the company has managed to increase dividends at an annualized rate of 16.90%.

Between 2010 and 2020 the company grew earnings from 45 cents/share to $1.49/share. The company is expected to earn $1.57/share in 2021.

The stock is selling at 30.40 times forward earnings and yields 2.35%.

Alliant Energy Corporation (LNT), headquartered in Madison, Wis., provides regulated electric and natural gas service to 970,000 electric and 420,000 natural gas customers across Iowa and Wisconsin.

The company increased quarterly dividends by 5.92% to 40.25 cents/share. This marked the 18th year of consecutive annual dividend increases for this dividend achiever

During the past decade, the company has managed to grow dividends at an annualized rate of 6.80%.

Between 2008 and 2019, Alliant Energy managed to grow earnings from $1.30/share to $2.33/share. The company is expected to earn $2.43/share in 2020.

The stock is selling at 20.30 times forward earnings and yields 3.25%.

Cintas Corporation (CTAS) provides corporate identity uniforms and related business services primarily in North America, Latin America, Europe, and Asia. It operates through Uniform Rental and Facility Services and First Aid and Safety Services segments.

The company raised its quarterly dividend by 7.14% to 75 cents/share. 

Cintas has paid cash dividends on its common stock for 37 consecutive years since it went public in 1983 and increased the annual regular dividend every year.

Over the past decade, Cintas has managed to increase dividends at an annualized rate of 19.30%. 

This dividend champion managed to grow earnings from $1.40/share in 2010 to $8.11/share in 2020. The company is expected to earn $9.67/share in 2021.

The stock is selling for 33.55 times forward earnings and yields 0.92%.

CMS Energy (CMS) is a Michigan-based company that has an electric and natural gas utility, Consumers Energy, as its primary business. It also owns and operates independent power generation businesses.

The company increased its quarterly dividend by 6.74% to 43.50 cents/share. This marked the 15th consecutive annual dividend increase for this dividend achiever.

During the past decade, the company has managed to increase dividends at an annualized rate of 9.50%.

The company managed to grow earnings from 91 cents/share in 2009 to $2.39/share in 2019. The company is expected to earn $2.67/share in 2020.

The stock is selling for 21.87 times forward earnings and yields 2.97%.

BlackRock, Inc. (BLK) is a publicly owned investment manager.

Blackrock increased its quarterly dividend by 13.77% to $4.13/share.

This is the 12th straight year of dividend increases for BlackRock, which is the largest asset management firm in the United States with $8.6 trillion in assets under management (AUM).

Over the past decade, Blackrock has managed to increase dividends at an annualized rate of 13.80%.

Between 2010 and 2020 the company managed to grow earnings per share from $10.55 to $31.85. The company is expected to earn $36.80/share in 2021.

Currently, the stock is selling for 20 times forward earnings and yields 2.24%.

Consolidated Edison, Inc. (ED) engages in regulated electric, gas, and steam delivery businesses in the United States.

The company increased its quarterly dividend by 1.30% to 77.50 cents/share.

This is the 47th consecutive annual increase for this dividend aristocrat. During the past decade, Con Edison has managed to increase dividends at an annualized rate of 2.50%.

The company has managed to grow earnings from $3.14/share in 2009 to $4.08/share in 2019. The company is expected to earn $4.21/share in 2020.

The stock is selling for 16.34 times forward earnings and yields 4.50%.

Enterprise Bancorp, Inc. (EBTC) operates as the holding company for Enterprise Bank and Trust Company that provides banking products and services primarily in the Greater Merrimack Valley, Nashoba Valley, and North Central regions of Massachusetts and Southern New Hampshire.

The company hiked its quarterly dividend by 5.71% to 18.50 cents/share. This marked the 28th consecutive year of annual dividend increase for this dividend champion. During the past decade, this dividend champion has managed to increase distributions at an annualized rate of 5.80%.

The bank has managed to increase earnings from 89 cents/share in 2009 to $2.89/share in 2019.

The stock is selling for 9.78 times earnings and yields 2.61%.

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4 comments:

  1. I checked FAST using my criteria and added this stock to my watchlist, however at the moment it looks too expensive for me with 29,43 Price to Free Cash Flow Ratio. At the same time Free Cash Payout of 61,67% is a little bit higher than my range.

    ReplyDelete
    Replies
    1. It is not cheap

      Just to be clear, this article shows a listing of companies that raised dividends last week.

      Delete
  2. Hi,
    I would like to ask why you're looking for companies with only 10 years of dividend increases? and not more than 10 or maybe less than 10? What so special with this 10 years?

    ReplyDelete

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