Monday, February 22, 2021

Fifteen Companies Rewarding Shareholders With a Raise

I review the list of dividend increases as part of my monitoring process. This process helps me review how the companies I own are doing. It also helps me identify companies for further research.

For this weekly review, I tend to focus my attention on companies with at least a ten year history of annual dividend increases, which also raised dividends last week. I provide a quick overview of each company that includes the amount of the most recent dividend increase, and compares it to its recent historical record. I also review the streak of annual dividend increases, and review earnings and valuation information.

Over the past week there were fifteen companies that raised dividends, and have a ten year history of annual dividend increases. The companies include:

The Coca-Cola Company (KO) is a beverage company that manufactures, markets, and sells various nonalcoholic beverages worldwide.

Coca-Cola hiked its quarterly dividend by 2.43% to 42 cents/share. This marked the 59th year of consecutive annual dividend increases for this dividend king. Over the past decade, the company has managed to grow dividends at an annualized rate of 6.40%.

The company is expected to earn $2.14/share in 2021.

The stock is not cheap at 23.69 times forward earnings, given the lack of earnings growth and the slowing dividend growth. It does offer a dividend yield of 3.31%, but the payout ratio is high at 78.50%.

Walmart Inc. (WMT) engages in the retail and wholesale operations in various formats worldwide. The company operates in three segments: Walmart U.S., Walmart International, and Sam's Club.

Wal-Mart hiked its quarterly dividend by 1.85% to 55 cents/share. This marked the 48th consecutive year of dividend increases for this dividend aristocrat. It also marked the 8th consecutive year of 2% dividend increases for Wal-Mart Stores. Over the past decade, the company has managed to grow dividends at an annualized rate of 6.20%.

The company is expected to earn $5.60/share in 2021

The stock is selling for 24.59 times forward earnings and yields 1.60%. I don’t think it offers a good value, given the high valuation, and low growth and yield.

The Sherwin-Williams Company (SHW) develops, manufactures, distributes, and sells paints, coatings, and related products to professional, industrial, commercial, and retail customers. It operates in three segments: The Americas Group, Consumer Brands Group, and Performance Coatings Group.

The company raised its quarterly dividend by 23.13% to $1.65/share. This increase follows 42 consecutive years of dividend increases for this dividend aristocrat. The company has managed to grow dividends at an annualized rate of 14% over the past decade.

The company is expected to earn 27.07/share in 2021. 

The stock sells for 26.85 times forward earnings and yields 0.91%. It would be nice if there was a dip below $600/share for this boring paint company.

Nestle S.A. (NSRGY) operates as a food and beverage company. The company operates through Zone Europe, Middle East and North Africa; Zone Americas; Zone Asia, Oceania and sub-Saharan Africa; and Nestle Waters segments.

The company raised its annual dividend to 2.75 Swiss Francs per share, which is a 1.85% increase over the previous annual payment. This marked the 26th consecutive annual dividend increase for this international dividend aristocrat. The company has managed to hike dividends at an annualized rate of 3.70%/year over the past decade.

The stock is selling for 22.31 times forward earnings and yields 2.80%.

British American Tobacco p.l.c. (BTI) provides cigarettes and other tobacco products worldwide.

The company raised its quarterly dividend by 2.50% to 53.90 British Pence/share. This comes out to an annualized payment of 2.156 British Pounds. For reference, in 2011 the company paid an annual dividend of 1.191 British Pounds/share.

Genuine Parts Company (GPC) distributes automotive replacement parts, industrial parts and materials, and business products in the United States, Canada, Mexico, Australasia, France, the United Kingdom, Germany, Poland, the Netherlands, and Belgium.

The company raised its quarterly dividend by 3.16% to 81.50 cents/share. This marked the 65th year of consecutive annual dividend increases for this dividend king. During the past decade, GPC has managed to grow dividends at an annualized rate of 6.80%.

The company is expected to earn $5.72/share in 2021.

The stock is selling for 17.66 times forward earnings and yields 3.23%.

Omnicom Group Inc. (OMC) provides advertising, marketing, and corporate communications services.

The company raised its quarterly dividend by 7.69% to 70 cents/share. This would mark the 12th year of consecutive annual dividend increases for this dividend achiever

During the past decade, the company has managed to increase distributions at an annualized rate of 13.20%/year. The rate of dividend growth has been dropping in recent years, as the company skipped a dividend increase in 2020. If Omnicom had not raised dividends in 2021, it would have lost its track record of annual dividend growth.

The company is expected to earn $5.59/share in 2021.

The stock sells for 11.94 times forward earnings and yields 4.19%. It is cheap, but traditional advertising industry is facing some headwinds.

Telephone and Data Systems, Inc. (TDS) is a telecommunications company, provides communications services in the United States. It operates through three segments: U.S. Cellular, Wireline, and Cable.

The company raised its quarterly dividend by 2.94% to 17.50 cents/share. This is the 47th year of consecutive annual dividend increases for this dividend champion.

The company has a 10 year growth rate of 4.18% annualized.

The stock is selling for 15 times forward earnings and yields 3.45%.

Extra Space Storage Inc. (EXR) headquartered in Salt Lake City, Utah, is a self-administered and self-managed REIT and a member of the S&P 500.

The REIT hiked its quarterly dividend by 11% to $1/share. This marked the 11th consecutive annual dividend increase for this dividend achiever. Extra Space Storage has a ten year dividend growth rate of 24.60% annualized.

The stock is selling for 23.11 times FFO and yields 3.38%

Humana Inc. (HUM) operates as a health and well-being company in the United States. It operates through Retail, Group and Specialty, and Healthcare Services segments.

The health insurer hiked its quarterly dividend by 12% to 70 cents/share. This marked the 10th year of consecutive annual dividend increases for this newly minted dividend achiever. Humana has managed to grow annual dividends at an annualized rate of 16.30% over the past 5 years.

The stock is selling for 17.55 times forward earnings and yields 0.74%.

Essex Property Trust, Inc. (ESS) is a fully integrated real estate investment trust (REIT) that acquires, develops, redevelops, and manages multifamily residential properties in selected West Coast markets.

This REIT hiked its quarterly dividends by 0.60% to $2.09/share. This marked the 27th consecytive annual dividend increase for this dividend champion. Over the past decade, this REIT has managed to raise dividends at an annualized rate of 7.10%.

The stock sells for 21.09 times FFO and yields 3.16%.

Xcel Energy Inc. (XEL) generates, purchases, transmits, distributes, and sells electricity. It operates through Regulated Electric Utility, Regulated Natural Gas Utility, and All Other segments.

Xcel Energy raised its quarterly dividend by 6.40% to 45.75 cents/share. This marked the 18th consecutive annual dividend increase for this dividend achiever. During the past decade, the company has managed to increase distributions at an annualized rate of 5.50%.

The company is expected to earn $2.98/share in 2021.

The stock is selling for 20.92 times forward earnings and yields 2.94%.

Analog Devices, Inc. (ADI) designs, manufactures, tests, and markets integrated circuits (ICs), software, and subsystems that leverage analog, mixed-signal, and digital signal processing technologies.

The company managed to increase dividends by 11.29% to 69 cents/share. This marked the 19th year of consecutive annual dividend increases for this dividend achiever. Over the past decade, the company has managed to grow dividends at an annualized rate of 11.20%.

Analog Devices is expected to earn $6.02/share in 2021.

The  stock is selling at 26.25 times forward earnings and yields 1.75%.

Public Service Enterprise Group Incorporated (PEG) operates as an energy company primarily in the Northeastern and Mid-Atlantic United States. It operates through two segments, PSE&G and PSEG Power.

The company raised its quarterly dividend by 4.08% to 51 cents/share, marking the tenth year of consecutive annual dividend increases. Over the past decade, this company has managed to grow dividends at an annualized rate of 3.75%.

The company is expected to earn $3.42/share in 2021.

The stock sells for 17.08 times forward earnings and yields 3.49%.

Jack Henry & Associates, Inc. (JKHY) provides technology solutions and payment processing services primarily for financial services organizations in the United States.

The company hiked its quarterly dividend by 6.98% to 46 cents/share. This marked the 31st year of consecutive annual dividend increases for this dividend champion. Over the past decade, it has managed to increase quarterly dividends at an annualized rate of 16.20%.

The company is expected to earn $3.85/share in 2021.

The stock sells for 39.72 times forward earnings and yields 1.20%.

Relevant Articles:

- Fourteen Dividend Growth Stocks Raising Dividends For Shareholders

Eight Dividend Paying Companies Growing Dividends Like Clockwork

Busiest Week For Dividend Increases Ever

Seven Companies Rewarding Shareholders With a Raise

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