Four Dividend Growth Companies Raising Dividends Last Week

I review the list of dividend increases every week, as part of my monitoring process. This exercise helps me monitor the dividend growth investing universe. This helps me monitor existing positions, and potentially uncover companies for further research.

I focus on those companies that have managed to increase dividends for at least a decade. Over the past week, there were four companies in the US that raised dividends, which also have a ten year track record of annual dividend increases under their belt. The companies include:

Agree Realty Corporation (ADC) is a publicly traded real estate investment trust that is involved in the acquisition and development of properties net leased to industry-leading, omni-channel retail tenants.

The REIT hiked monthly dividends to $0.262/share. This is the 13th consecutive annual dividend increase for this dividend achiever. Over the past five years, the company has managed to grow dividends at an annualized rate of 6%.

Between 2015 and 2024, the REIT grow FFO/share from $2.40 to $3.78.

Agree Realty is expected to generate $4.25/share in FFO in 2025.

The stock sells for 17.65 times forward FFO and a dividend yield of 4.20%

A. O. Smith Corporation (AOS) manufactures and markets residential and commercial gas and electric water heaters, boilers, heat pumps, tanks, and water treatment products in North America, China, Europe, and India. 

The company increased quarterly dividends by 5.90% to $0.36/share. This is the 32nd year of annual dividend increases for this dividend aristocrat. Over the past five years, the company has managed to grow dividends at an annualized rate of 7.60%.

Between 2015 and 2024, the company managed to grow earnings from $1.59/share to $3.65/share.

The company is expected to earn $3.84/share in 2025.

The stock sells for 18.20 times forward earnings and a dividend yield of 2.07%

Lincoln Electric Holdings, Inc. (LECO) designs, develops, manufactures, and sells welding, cutting, and brazing products in the United States and internationally. It operates in three segments: Americas Welding, International Welding, and The Harris Products Group. 

The company increased quarterly dividends by 5.30% to $0.79/share. This is the 30th consecutive annual dividend increase for this dividend champion. Over the past five years, the company has managed to grow dividends at an annualized rate of 8.60%.

Between 2015 and 2024, the company grew earnings from $1.70/share to $8.15/share.

Lincoln Electric is expected to earn $9.71/share in 2025.

The stock sells for 24.20 times forward earnings and a dividend yield of 1.34%.

IDACORP, Inc. (IDA) engages in the generation, transmission, distribution, purchase, and sale of electric energy in the United States. 

The company increased quarterly dividends by 2.30% to $0.88/share. This is the 13th consecutive annual dividend increase for this dividend achiever. Over the past five years, the company has managed to grow dividends at an annualized rate of 5.50%.

Earnings grew from $3.88/share in 2015 to $5.50/share in 2024.

The company is expected to earn $5.85/share in 2025.

The stock sells for 23.23 times forward earnings and a dividend yield of 2.53%.

Relevant Articles:

- Four Dividend Growth Companies Announcing Raises Last Week

- Five Dividend Growth Stocks Raising Dividends Last Week

- Three Dividend Growth Stocks In The News

- Two Dividend Growth Companies With Raises Last Week

Four Dividend Growth Companies Announcing Raises Last Week

I review the list of dividend increases as part of my monitoring process. This exercise is one of the steps to check on existing holdings. It's also one of the steps to check on companies for further research. The data points I illustrate for each company below are the types of data points I use to review companies.

I typically focus my attention on companies that have managed to grow dividends for at least ten years in a row. However, a long streak of consecutive annual dividend increases is just a first step, that merely puts a company on my review list. The next step involves reviewing the most recent dividend increase with the historical record - 5 or 10 years. This is also followed by a review of earnings, payout ratios and other fundamentals, in an effort to determine the likelihood of the dividend growing in the future, and the relative safety of said dividend.

Over the past week, there were four companies that announced dividend hikes. Each of these companies has also managed to increase dividends for at least ten years in a row. The companies include:

Avient Corporation  (AVNT) operates as a formulator of material solutions in the United States, Canada, Mexico, Europe, South America, and Asia. It operates in two segments, Color, Additives and Inks; and Specialty Engineered Materials.

Avient raised quarterly dividends by 1.90% to $0.275/share.This is the 15th consecutive year of dividend icnreases for this dividend achiever.

Over the past decade, the company has managed to grow dividends at an annualized rate of 10.44%.

Between 2015 and 2024, the company managed to grow earnings from $1.65/share to $1.86/share.

The company is expected to earn $2.80/share in 2025.

The company is selling at 10.85 times forward earnings a a dividend yield of 3.62%.

The lack of earnings growth explains the slow dividend raises. While P/E is low and the yield is high, the expected returns are going to be low, until earnings per share growth accelerates. At this pace dividend payments will not keep up with inflation.

Northwest Natural Holding Company (NWN) provides regulated natural gas distribution services to residential, commercial, and industrial customers in the United States. 

Northwest Natural raised quarterly dividends by 0.50% to $0.4925/share. This is the 70th consecutive year of dividend increases for this dividend king. Over the past decade, the company has managed to grow dividends at an annualized rate of 0.53%.

Between 2015 and 2024, the company managed to grow earnings from $1.96/share to $2.03/share.

The company is expected to earn $2.91/share in 2025.

The company is selling at 15.32 times forward earnings a a dividend yield of 4.40%.

The lack of earnings growth explains the very slow rate of dividend increases. While the company does have a long and impressive streak of dividend increases, the rates of increase are nominal, and do not keep up with inflation. As a result, the expected returns are going to be limited in the future to dividend yield at start of investment. Unless earnings increase in the future, dividend growth will be nominal, until the dividend payout ratio increases by too much, at which point we may get a higher risk of a dividend cut. One could potentially expect higher returns if they can find the stock at a much higher starting yield.

Lockheed Martin Corporation (LMT) is an aerospace and defense company, engages in the research, design, development, manufacture, integration, and sustainment of technology systems, products, and services worldwide. The company operates through four segments: Aeronautics; Missiles and Fire Control (MFC); Rotary and Mission Systems (RMS); and Space. 

Lockheed Martin increased quarterly dividends by 4.50% to $3.45/share. This is the 23rd consecutive annual dividend increase for this dividend achiever. Over the past decade, the company has managed to grow dividends at an annualized rate of 8.20%.

This is also the smallest dividend increase in 23 years as well.

Between 2015 and 2024, the company managed to grow earnings from $11.62/share to $22.39/share.

The company is expected to earn $21.92/share in 2025.

The company is selling at 23.04 times forward earnings a a dividend yield of 2.73%.

The rate of dividend growth decelerating is signaling some uncertainty from management. While the stock seems fairly priced, and has managed to grow earnings in the past at a very good rate, the future seems a little cloudy at this point.

THOR Industries, Inc. (THOR) designs, manufactures, and sells recreational vehicles (RVs), and related parts and accessories in the United States, Germany, rest of Europe, Canada, and internationally. 

Thor increased the quarterly dividend by 4% to $0.52/share. This is the 16th consecutive annual dividend increase for this dividend achiever. Over the past decade, it has managed to grow dividends at an annualized rate of 7.30%.

Earnings per share went from $4.89 in 2015 to $4.87 in 2024.

The company is expected to earn $4.08/share in 2025.

The company is selling at 24.35 times forward earnings a a dividend yield of 2.10%.

We have another dividend increaser that has been unable to grow earnings over the past decade, which means that future dividend growth is decelerating. Unfortunately, there is a natural ceiling as to how long a company can grow dividends.

Relevant Articles:

- Five Dividend Growth Stocks Raising Dividends Last Week

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The human mind cannot comprehend the power of compounding

The human mind cannot comprehend the power of compounding.

Imagine that you retired in 1985 with $100,000 and a paid off home. 

You invested this $100,000 in S&P 500 mutual fund at the end of 1985.

You lived off dividends, Social Security and enjoyed your money.

You spent the dividends, but kept the portfolio invested.

The first year, you generate almost $4,000 in annual dividend income.

This year you are on track to generate over $37,000 in annual dividend income.

You die in 2025 with a portfolio worth $3.2 Million.

97% of that gain in net worth occured in the past 40 years of your life.

You lived a full life, enjoying retirement as well.

If you didn't have anyone to inherit from you, you'd likely be one of those who make headlines for donating millions to charity.

If you do have kids/grandkids, they'd receive a decent inheritance to provide some added cushion.

Ironically, any time I post something like this, someone would state that "they didn't enjoy their money".

This comes from the misunderstanding of compounding, and nature of long-term stock returns.

To put it simply, this individual sees that someone has $3.2 Million at the end, and they now assume that this money was always there, they always had $3.2 Million so in their mind "they should've spent more".

Of course, that person did not have that $3.2 Million until the end of their journey.

If they had "spent more" when they retired in 1985, they'd have run out of money by the late 1980s/early 1990s and would've nothing to show for it.

The reality is that this person enjoyed life, being in charge of their schedule, living in their paid off home, receiving Social Security checks and rising dividend income. Perhaps they even received a corporate pension, but I am not including it, as not many folks today have that (I guess less today than historically speaking).

This basically gets to the point that to most people, having $1 Million means spending $1 Million, which is the opposite of having $1 Million.

To smart investors however, having $1 Million means having a small army of dollar soldiers who work tirelessly for you, 24/7, which provide the income to enjoy your life so you don't have to work. That money provides freedom and piece of mind.

Anywho, this is a fun thought exercise I go through from time to time.

Or as I like to say " I often think about that".

Five Dividend Growth Stocks Raising Dividends Last Week

I review the list of dividend increases every single week, as part of my monitoring process. This exercise helps visualize what key drivers I look for in dividend growth stocks, and also how I review them for fundamentals and valuation. 

Ultimately, returns are a function of:

1. Dividends

2. Earnings Per Share Growth

3. Change in valuation

As a long-term investor, I look for companies that grow earnings and dividends, and try to acquire them at a good price. Afterwards, the goal is to sit back, and let the power of compounding do the heavy lifting for me.

I expect to be wrong 40% - 60% of the time, but I do expect that I will be right on the remainder. The remainder of winners will more than compensate for any losers, and then some. I rarely know which of the companies will be the biggest successes, which is why I take a lot of shots, I diversify, and I hold for as long as possible. I also manage risk by limiting downside, but letting the upside grow with as little limitation on my end as possible.

Anywho, over the past week, there were five dividend growth companies which both raised dividends and also have managed to increase dividends annually for at least ten years in a row. The companies include:

Bank OZK (OZK) operates as a full-service Arkansas state-chartered bank that provides retail and commercial banking services in the United States.

Bank OZK raised quarterly dividends by 2.30% to $0.45/share. The bank has raised dividends for 61 consecutive quarters and 27 consecutive years. Over the past decade, this dividend champion has managed to grow dividends at an annualized rate of 12.90%.

The new payment is 9.75% higher over the dividend paid during the same time last year.

The bank earned $2.10/share in 2015 and managed to grow it to $6.16/share in 2024.

The company is expected to earn $6.34/share in 2025.

The stock sells for 8.08 times forward earnings and has a dividend yield of 3.51%.

Farmers & Merchants Bancorp, Inc. (FMAO) operates as the bank holding company for The Farmers & Merchants State Bank that provides commercial banking services to individuals and small businesses in Northwest Ohio, Northeast Indiana, and Southeast Michigan.

Farmers & Merchants Bancorp (FMAO) raised quarterly dividends by 2.80% to $0.2275/share. This is teh 20th 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 7.70%.

The bank managed to grow earnings from $1.12/share in 2015 to $1.90/share in 2024.

The company is expected to earn $2.27/share in 2025.

The stock sells for 11.15 times forward earnings and has a dividend yield of 3.60%.

RPM International Inc. (RPM) provides specialty chemicals for the construction, industrial, specialty, and consumer markets. It operates in four segments: CPG, PCG, Consumer, and SPG. 

RPM raised quarterly dividends by 5.90% to $0.54/share. This is the 52nd consecutive year that this dividend king has increased its cash dividend. Over the past decade, the company has managed to grow dividends at an annualized rate of 6.80%.

The company clearly states that Dividend Growth Drives Total Returns on its website: 

"In an era of extremely low interest rates on savings account and other interest-bearing investment options, RPM’s dividend growth—coupled with an appreciating stock price—yield a total return that makes the company attractive to both institutional and individual investors.

Since initiating its focus on an annually growing dividend in 1973 to drive long-term value for shareholders, $RPM has grown from $25 million in annual sales to more than $7.4 billion, while delivering $3.8 billion in after-tax capital through its cash dividend program."

The company earned $2.70/share in 2016 and grew profits to $5.38/share in 2025.

The company is expected to earn $5.68/share in 2026.

The stock sells for 20.59 times forward earnings and has a dividend yield of 1.85%.

Starbucks Corporation (SBUX) operates as a roaster, marketer, and retailer of coffee worldwide. The company operates through three segments: North America, International, and Channel Development. 

Starbucks raised quarterly dividends by 1.60% to $0.62/share. This is the 15th consecutive annual dividend increase for this dividend achiever.

This is also the smallest dividend increase ever for Starbucks. Over the past decade, the company has managed to grow dividends at an annualized rate of 15.50%.

The company managed to grow earings from $1.84/share in 2015 to $3.32/share in 2024.

The company is expected to earn $2.17/share in 2025.

The stock sells for 39.84 times forward earnings and has a dividend yield of 2.87%.

Trinity Bank, N.A. (TYBT) provides personal and business banking products and services in Texas.

Trinity Bank raised its semi-annual dividends by 5.30% to $1/share. This represents the 13th consecutive annual dividend increase for this dividend achiever. Over the past decade, the company has managed to grow dividends at an annualized rate of 10.80%.

The company grew earnings from $2.91/share in 2014 to $7.83/share in 2024.

The stock sells for 12.26 times earnings and yields 2.20%.

I honestly love how they show the dividends paid over the past 13 years, and totaled it in the press release. For reference, stock was at around $26.50/share at the end of 2011.

Relevant Articles:

- Three Dividend Growth Stocks In The News

- Six Dividend Growth Stocks Raising Dividends Last Week

- Two Dividend Growth Companies With Raises Last Week

- Eleven Dividend Growth Stocks Raising Dividends Last Week

Dividends Matter (A Lot)

Dividends have historically accounted for 33% - 40% of historical annual total returns. 

This is the beauty of averages however.

During long bull markets, dividends are outshined by capital gains. Examples of long bull markets include the ones seen in the 1920s, 1950s and 1960s, 1980s and 1990s and then the 2010s and 2020s.

Investors during those long bull markets see dividends as irrelevant during those periods.

However, during those long cyclical bear market stretches, dividends tend to account for 100% of total returns.

Those long stretches of time include the:

1929 - 1954

1966 - 1982

2000 - 2012

During those long stretches of time, investors are reminded that while annualized total returns are roughly 10%/year, those returns are just averages. You can spend many years with no capital gains to show (in a diversified portfolio), during which time dividends are the only source of return you will get.

This is why I focus my whole strategy around dividends - these payments help me stay invested through the ups and downs, because I get cashflow that comes from corporate profits. These are much more stable and predictable than share prices (in the short and medium and long run).

I went ahead and obtained a chart of S&P 500 index on a real price return basis. It shows the price of the S&P500 index since 1871, but adjusted for inflation.

Source: Multpl.com

Note, the chart above shows the S&P 500 price adjusted for inflation.

You can see that while stock prices have tended to go up over time, there have been long stretches of time when they didn't. Notable examples include the 1910s, when we had the Great War.

The next example is the 1929 - 1954, when we had the Great Depression and World War II.

The third major example is the 1966 - 1982, when we had high inflation, and high interest rates. Some economists refer to the 1970s as a staglation - low economic growth coupled with high inflation.

The last major example is 2000 - 2012, when we had the implosion of the dot-com bubble, the Global Financial Crisis, as well as high inflation (remember the commodities boom, and BRICs?)

Of course, long-term readers know that with stocks, you generate total returns.

Total returns are a function of dividends and capital gains. 

The chart above only shows capital appreciation, adjusted for inflation.

I see that chart quite often on the interwebs, as an effort by someone to scare people out of owning stocks. It's easy to try and deceive others, by showing biased data, which shows only half of the picture. 

If you show an inflation adjusted total returns chart on S&P 500, you see a much different picture.

The thing is, it is not easy to find a total returns inflation adjusted chart on the S&P 500 since 1871. Which is odd, because the data for it exists.

So, I went ahead and made a chart of the inflation adjusted total returns of S&P 500 since 1871.

Source: Shillerdata.com 

Note the chart above shows the real total returns for S&P 500 from a base of $115 in January 1871.

You can see that when you adjust for dividends, the chart of total returns is much smoother. 

For example, that 1929 peak is not as scary. If you invested in stocks at the very highs in 1929, and you reinvested your dividends, you broke even by 1936/1937. That's just 7-8 years, versus the 25 years you often see quoted around everywhere.

This data and graphs are mostly a reminder to stay invested in diversified portfolios for the long run. One needs to keep costs, taxes, fees, turnover low, and stay invested.

To me, it is a reminder to keep investing for the dividend, and ignore the share prices.

Dividends are much easier to predict, forecast and rely on, because they come from cashflows. They are always positive source of returns, and they tend to grow at or above rate of inflation in the long run. This makes them an ideal source of income for retirees.

In the accumulation phase, this means adding to my portfolio and reinvesting dividends, until dividend income exceeds expenses. 

In the retirement phase, this means taking dividends in cash and spending them, leaving anything left over to reinvest.

I do not want to be in a situation where I have to sell stock, because that way I may deplete my portfolio. A negative sequence of return risk at the onset of withdrawals can easily deplete a portfolio that relies of stock sales.

Now historically, a large portion of total returns came from dividends. So those who lived off portfolios (even S&P 500 market index types) didn't actually have to sell stock in most cases. That did change in the 1990s, with the dot-com bubble, and the proliferation of buybacks over dividends.

The real risk today is that you may experience long sideways market without the cushion of dividend payments, given that they are much lower today than in previous decades. We are in uncharted territory.

As we saw in the 1970s and 2000s, buybacks can reduce shares outstanding and lift EPS. However, if the P/E valuation mutliple shrinks, then you are setting money on fire with the buyback. I am giving buybacks the benefit of the doubt here, because I am not even going to mention that many buybacks were initially implemented as a way to offset the dillution from equity compensation to employees. Which should be reducing EPS.

The other real risk today is that in order to generate starting yields above 1%, which is what S&P 500 offers, one needs to create a portfolio that looks different than S&P 500. It is quite possible to build a portfolio that yields say 3% on average today, which would grow dividends at or above rate of inflation over time. 

However, you risk that your total returns may end up to be different than S&P 500. 

A) Which could turn out to be having better returns in some of the situations, where we may experience a prolonged bear market. 

B) However it cold turn out to also be having worse returns in some of the situations, where we may experience a prolonged bull market.