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Monday, August 2, 2021

Nine Companies Delivering Solid Dividend Growth

As part of my monitoring process, I review the list of dividend increases every week. I usually focus my attention on the list of companies that have managed to boost distributions for at least a decade.

I have compiled the list of companies that have raised dividends for at least a decade, which also managed to boost dividends last week. The one exception was Mondelez, which I wanted to highlight since I own it. 

The companies for this weeks report include:

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.

Cintas raised its quarterly dividend by 26.70% to 95 cents/share. This marks the 38th consecutive year of annual dividend increases for this dividend aristocrat. The company switched from making annual payments in 2020 to paying dividends quarterly.

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

Cintas has managed to grow earnings from $2.27/share in 2012 to $10.24/share in 2021.

Cintas is expected to earn $10.64/share in 2022.

The stock is selling for 36.70 times forward earnings and yields 0.97%.

Mondelez International, Inc. (MDLZ) manufactures, markets, and sells snack food and beverage products worldwide.

The company raised its quarterly dividend by 11.10% to 35 cents/share. The company has hiked its quarterly dividend every single year since it split from Kraft Foods in 2012. Mondelez has managed to grow dividends at an annualized rate of 12.80% over the past 5 years.

Mondelez has managed to grow earnings from $2.01/share in 2011 to $2.69/share in 2020.

Mondelez is expected to earn $2.92/share in 2021.

The stock is selling for 21.69 times forward earnings and yields 2.21%.

McKesson Corporation (MCK) provides healthcare supply chain management, retail pharmacy, community oncology and specialty care, and healthcare information solutions in the United States and internationally. It operates through four segments: U.S. Pharmaceutical, International, Medical-Surgical Solutions, and Prescription Technology Solutions (RxTS)

The company raised its quarterly dividend by 11.90% to 47 cents/share. This dividend achiever has managed to increase annual dividends for 14 years in a row. McKesson has managed to grow dividends at an annualized rate of 9.60% during the past decade.

McKesson is expected to earn $19.08/share in 2022. For comparison purposes, the company’s earnings per share went from $5.59 in 2012 to $4.95/share in 2020. The company lost $28.26/share in 2021.

The stock is selling for 10.70 times forward earnings and yields

UMB Financial Corporation (UMBF) operates as the bank holding company for the UMB Bank that provides various banking and other financial services.

The company raised its quarterly dividend by 15.60% to 37 cents/share. This was the 30th year of consecutive annual dividend increases for this dividend champion.

Over the past decade, the company has been able to grow dividends at an annualized rate of 5.30%.

UMB Financial managed to grow earnings from $2.64/share in 2011 to $5.93/share in 2020. The company is expected to earn $7.16/share in 2021.

The stock is selling for 13.08 times forward earnings and yields 1.58%.

Republic Services, Inc. (RSG) provides non-hazardous solid waste collection, transfer, disposal, recycling, and environmental services in the United States.

The company raised its quarterly dividend by 8.20% to 46 cents/share. This is the seventeenth consecutive year of increasing the dividend for Republic Services. Over the past decade, the company has been able to grow dividends at an annualized rate of 7.90%.

Between 2011 and 2020, this dividend achiever has managed to grow earnings from $1.56/share to $3.02/share.

Republic Services is expected to earn $3.85/share in 2021.

The stock is selling for 29.95 times forward earnings and yields 1.47%.

The Hershey Company (HSY) manufactures and sells confectionery products and pantry items. The company operates in two segments, North America; and International and Other.

The company raised its quarterly dividend by 12% to 90.10 cents/share. This marked the 12th year of consecutive annual dividend increases for this dividend achiever. Over the past decade, the company has been able to grow dividends at an annualized rate of 9.40%.

Between 2011 and 2020, Hershey managed to increase earnings from $2.74/share to $6.11/share.

Hershey is expected to earn $6.89/share in 2021.

The stock is selling for 25.62 times forward earnings and yields 1.82%.

KLA Corporation (KLAC) designs, manufactures, and markets process control and yield management solutions for the semiconductor and related nanoelectronics industries worldwide.

The company raised its quarterly dividend by 17% to $1.05/share.

This is the twelfth consecutive dividend level increase for this dividend achiever.

Between 2011 and 2020, the company managed to grow earnings from $4.66/share to $7.70/share.

The company is expected to earn $14.12/share in 2021.

The stock is selling for 22.34 times forward earnings and yields 1.14%.

American States Water Company (AWR) provides water and electric services to residential, commercial, industrial, and other customers in the United States. It operates through three segments: Water, Electric, and Contracted Services.

The company raised its quarterly dividend by 9% to 36.50 cents/share. This dividend king has paid dividends every year since 1931, increasing the dividends received by shareholders each calendar year for 67 consecutive years.

Between 2011 and 2020, the company managed to increase earnings from $1.21/share to $2.33/share.

American States Water Company is expected to earn $2.43/share in 2021.

The stock is selling for 36.35 times forward earnings and yields 1.65%.

Diageo plc (DEO) produces, markets, and sells alcoholic beverages. 

The company increased its Final Dividend by 5% to 44.59 British Pence/share. Diageo had raised its interim dividend by only 2% in the Spring. The total annual dividend in 2021 is 3.82% higher than the total annual dividend paid in 2020.

Diageo has managed to increase dividends annually since at least 1998.

The stock sells for 27.45 times forward earnings and yields 2%.

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