Genuine Parts Company (GPC) distributes automotive replacement parts, industrial replacement parts, office products, and electrical/electronic materials in the United States, Canada, Mexico, Australia, New Zealand, Puerto Rico, the Dominican Republic, and the Caribbean region. The company raised its quarterly dividend by 6.90% to 65.75 cents/share. This marked the 60nd consecutive annual dividend increase for the dividend king Genuine Parts Company. In the past decade, Genuine Parts Company has managed to increase its annual dividend by 6.90%/year. The stock is selling at 19.20 times forward earnings and yields 2.90%. I find the company to be an attractive opportunity for long-term investors at the moment. Check my analysis of Genuine Parts Company for more information.
The Coca-Cola Company (KO), a beverage company, manufactures and distributes various nonalcoholic beverages worldwide. The company raised its quarterly dividend by 6.10% to 35 cents/share. This marked the 54th consecutive annual dividend increase for the dividend king Coca-Cola. In the past decade, Coca-Cola has managed to increase its annual dividend by 9%/year. The stock is selling at 22.60 times forward earnings and yields 3.20%. While raising dividends for 5 decades is an impressive track record, I do not like the fact that earnings per share have not increased since 2012. Without further growth in earnings per share, dividend growth will be limited. Therefore, at this time I would not be interested in adding to Coca-Cola. I would continue holding the stock however, but allocate dividends elsewhere ( in my case, I am spending taxable dividends in 2016).
Digital Realty Trust, Inc. (DLR) is a real estate investment trust (REIT) which engages in the ownership, acquisition, development, redevelopment, and management of technology-related real estate. The REIT raised its quarterly dividend by 3.50% to 88 cents/share. This marked the 12th consecutive annual dividend increase for Digital Realty Trust. In the past decade, Digital Realty Trust has managed to increase its annual dividend by 14.40%/year. The stock is selling at 14.90 times expected FFO of $5.45/share and yields 4.40%. As I reduce exposure to pass-through entities, I am in the process of reducing exposure to Digital Realty as well.
Wal-Mart Stores, Inc. (WMT) operates retail stores in various formats worldwide. The company operates through three segments: Walmart U.S., Walmart International, and Sam’s Club. The company raised its quarterly dividend by 2% to 50 cents/share. This marked the 43th consecutive annual dividend increase for this dividend champion. In the past decade, Wal-Mart Stores has managed to increase its annual dividend by 12.90%/year. The last three dividend increases have been disappointing at roughly 2%/each. The stock is selling at 15.50 times forward earnings and yields 3.10%. At this time, I do not consider Wal-Mart to be an attractive investment, given the lack of earnings growth for the past four fiscal years. I would continue to hold on to my Wal-Mart stock, but allocate dividends elsewhere. Check my analysis of Wal-Mart for more information.
NextEra Energy, Inc. (NEE), through its subsidiaries, generates, transmits, and distributes electric energy in the United States and Canada. The company raised its quarterly dividend by 13% to 87 cents/share. This marked the 22nd consecutive annual dividend increase for NextEra. In the past decade, NextEra has managed to increase its annual dividend by 8.10%/year. The stock is selling at 18.70 times earnings and yields 3.10%. When I last reviewed the company a few years ago, I really liked the growth story behind this utility. For whatever reason however, I never really pulled the trigger on it. I believe that the company has more growth ahead for it, though the stock price is getting close to the top of the maximum valuation I am willing to pay for it.
Questar Corporation (STR) operates as an integrated natural gas company in the United States. It distributes natural gas as a public utility in Utah, southwestern Wyoming, and a small portion of southeastern Idaho. The company raised its quarterly dividend by 4.80% to 22 cents/share. This marked the 37th consecutive annual dividend increase for Questar. In the past decade, Questar has managed to increase its annual dividend by 6.60%/year. The stock is selling at 19.20 times earnings and yields 3.50%. The company is in the process of being acquired by Dominion Resources for $25/share in cash. For those of you who like merger arbitrage, and who believe the stock will be indeed acquired, it might make sense to buy the stock and hold on until it closes.
The Sherwin-Williams Company (SHW) develops, manufactures, distributes, and sells paints, coatings, and related products to professional, industrial, commercial, and retail customers primarily in North and South America. The company raised its quarterly dividend by 25.40% to 84 cents/share. This marked the 38th consecutive annual dividend increase for this dividend champion. In the past decade, Sherwin-Williams has managed to increase its annual dividend by 12.60%/year. The stock is selling at 20.50 times forward earnings and yields 1.30%. This is the type of dividend growth stock that offers low yield today, but could deliver high yields on cost over time.
Buckeye Partners, L.P. (BPL) owns and operates liquid petroleum products pipeline systems in the United States. The company operates through four segments: Pipelines & Terminals, Global Marine Terminals, Merchant Services, and Development & Logistics. This MLP raised quarterly distributions to $1.1875/unit, which was up from $1.1375/unit distribution paid at the same time last year. This MLP has increased distributions for 21 years in a row and has a ten year distribution growth rate of 5.10%/year. As I am focusing away from pass through entities, I am posting this increase merely for information purposes for readers.
Xcel Energy Inc. (XEL), through its subsidiaries, engages primarily in the generation, purchase, transmission, distribution, and sale of electricity in the United States. It operates through Regulated Electric Utility, Regulated Natural Gas Utility, and All Other segments. The company raised its quarterly dividend by 6.2% to 34 cents/share. This marked the 13th consecutive annual dividend increase for Xcel Energy. In the past decade, Xcel Energy Stores has managed to increase its annual dividend by 4.10%/year. The stock is selling at 17.80 times forward earnings and yields 3.40%.
Over the past couple of weeks, several people have tried to point out the fact that I had three dividend cuts in the past year - Baxter, Kinder Morgan and ConocoPhillips. Perhaps it is my fault, because I do not like showing off my success from humble beginnings, but prefer to talk about my mistakes as learning opportunities that could benefit my readers. To put this in perspective however, just this week alone I had five dividend increases. In the week prior to that, I had three companies I own raise dividends. The week before that there were two companies I owned that announced their intentions to hike dividends. It is important to keep things in perspective. In my case, it all rests on formulating goals, developing a plan to achieve those goals, and then executing on my plan, while continuously trying to improve on it.
Full Disclosure: Long BAX, BXLT, KMI, GPC, KO, DLR, WMT, TROW,
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- How to Increase Dividend Income
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