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Monday, August 9, 2021

Seven Companies Demonstrating A Commitment to Shareholder Returns

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

This helps me review existing holdings, and identify companies for further research.

Over the past week, there were several companies that raised dividends to shareholders, which also have at least a ten year track record of annual dividend increases. The companies include:

Illinois Tool Works Inc. (ITW) manufactures and sells industrial products and equipment worldwide. It operates through seven segments: Automotive OEM; Food Equipment; Test & Measurement and Electronics; Welding; Polymers & Fluids; Construction Products; and Specialty Products.

Illinois Tool Works increased its quarterly dividend by 7% to $1.22/share. This marked the 50th consecutive year of annual dividend increases for this newly minted dividend king. The company has managed to grow dividends at an annualized rate of 13.10% over the past decade.

Between 2011 and 2020, Illinois Tool Works managed to grow earnings from $4.19/share to $6.63/share.

The company is expected to earn $8.56/share in 2021.

The stock is selling for 26.59 times forward earnings and yields 2.14%

Dover Corporation (DOV) provides equipment and components, consumable supplies, aftermarket parts, software and digital solutions, and support services worldwide.

The company raised its quarterly dividend by 1% to 50 cents/share. This marked the 66th consecutive year in which this dividend king has increased its annual cash dividend. The company has managed to grow dividends at an annualized rate of 8.20% over the past decade. The rate of dividend growth has slowed down since 2018 however.

Between 2011 and 2020, Dover managed to grow earnings from $4.74/share to $4.70/share.

The company is expected to earn $7.50/share in 2021.

The stock is selling for 22.59 times forward earnings and yields 1.18%.

Federal Realty Investment Trust (FRT) operates as a real estate investment trust, which engages in the ownership, management, development, and redevelopment of retail and mixed-use properties. 

This REIT raised its quarterly dividend by 0.90% to $1.07/share. This marked the 54th consecutive annual dividend increase for this dividend king. This Real Estate Investment Trust prides itself in its consistency of operations, which have allowed it to raise dividends for 54 years in a row. Annual distributions rose from 12 cents/share in 1967 to an estimated $4.28/share at the new distribution rate. The company has managed to grow dividends at an annualized rate of 4.70% over the past decade.



Federal Realty Investment Trust has managed to grow dividends at a rate of 5.40%/year over the past decade. This was supported by growth in Funds From Operations from $4/share in 2011 to $4.38/share in 2020. The REIT is expected to earn $4.91/share in 2021.

Currently, this REIT is overvalued at 24.70 times FFO and yields 3.53%. 

Carlisle Companies Incorporated (CSL) operates as a diversified manufacturer of engineered products in the United States, Europe, Asia, Canada, Mexico, the Middle East, Africa, and internationally. It operates through four segments: Carlisle Construction Materials, Carlisle Interconnect Technologies, Carlisle Fluid Technologies, and Carlisle Brake & Friction.

The company raised its dividend by 3% to 54 cents/share. This marked the 45th year of consecutive annual dividend increases for this dividend champion. The company has managed to grow dividends at an annualized rate of 12% over the past decade.

Between 2011 and 2020, Carlisle managed to grow earnings from $2.86/share to $5.80/share.

The company is expected to earn $9.05/share in 2021.

The stock is selling for 22.70 times forward earnings and yields 1.05%.

Fidelity National Financial, Inc. (FNF) provides various insurance products in the United States. The company operates through Title, F&G, and Corporate and Other segments.

Fidelity National Financial increased its quarterly dividend by 11.10% to 40 cents/share. This marked the tenth consecutive annual dividend increase for this newly minted dividend achiever.

Between 2011 and 2020, Fidelity National Financial managed to grow earnings from $1.65/share to $4.99/share.

The company is expected to earn $6.51/share in 2021.

The stock sells for 7.18 times forward earnings and yields 3.42%.

Terreno Realty Corporation (TRNO) acquires, owns and operates industrial real estate in six major coastal U.S. markets: Los Angeles, Northern New Jersey/New York City, San Francisco Bay Area, Seattle, Miami, and Washington, D.C.

Terreno Realty increased dividends by 17.20% to 34 cents/share. This marked the tenth year of consecutive annual dividend increases for this newly minted dividend achiever. 

The company is expected to generate $1.70/share in FFO in 2021.

The stock is selling for 40.11 times forward FFO and yields 2%.

NewMarket Corporation (NEU) engages in the petroleum additives businesses.

The company raised its quarterly dividend by 10.52% to $2.10/share. This marked the 16th year of consecutive annual dividend increases for this dividend achiever.  The company has managed to grow dividends at an annualized rate of 17.60% over the past decade. The rate of dividend growth has slowed down to 6.30% in the past 5 years however.

Earnings per share grew from $15.09 in 2011 to $24.64 in 2020. 

The stock is selling for 12.60 times earnings and yields 2.56%.

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