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Monday, May 16, 2022

Seven Dividend Growth Stocks Rewarding Shareholders With Raises

 As part of my review process, I monitor the list of dividend increases every week. I use several different resources to come up with a list of dividend increases for the week. I then narrow the list down to include only these companies that have a minimum streak of annual dividend increases. In this case, I focus on companies that raised dividends for at least a decade.


There were seven dividend growth stocks that raised dividends last week. One of them, MSA Safety is a newly minted dividend king.

The companies that increased dividends over the past week include:

Company

Ticker

New Dividend

Old Dividend

Increase

Years Dividend Increases

P/E

Dividend Yield

10 year Annualized Dividend Growth

Algonquin Power & Utilities

AQN

 $ 0.1808

 $ 0.1706

5.98%

12

18.86

5.13%

9.59%

Union Pacific

UNP

 $    1.30

 $    1.18

10.17%

16

19.67

2.25%

16.09%

Alerus Financial

ALRS

 $    0.18

 $    0.16

12.50%

24

10.69

2.84%

7.77%

Phillips 66

PSX

 $    0.97

 $    0.92

5.43%

10

9.81

4.10%

8.12%

Cardinal Health

CAH

 $ 0.4957

 $ 0.4908

1.00%

26

10.67

3.57%

9.07%

First Merchants

FRME

 $    0.32

 $    0.29

10.34%

11

10.47

3.25%

39.67%

Microchip Technology

MCHP

 $ 0.2760

 $ 0.2530

9.09%

22

12.32

1.65%

2.09%



This is not an automatic list to buy of course. I would review each company, and determine if it makes sense from a fundamentals point of view. This would include reviewing trends in earnings, dividends, payout ratios, revenues, and gaining an understand of the company's business model.

The job is not done just by reviewing fundamentals however. The investor also needs to come up with a conclusion whether the stock is fairly valued at the moment. If it is not, then the investor may come up with a price at which the security may be attractive.

The other thing to consider is that valuation is relative. When evaluating companies, we compare them to other companies with promising fundamental and valuation characteristics. Then, we strive to pick the company or companies with the best values in the investors opportunity set.

While this sounds like a lot of work on the surface, with practice, it becomes almost a second nature.

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