Last week, there was only one dividend increase from a company that has managed to grow dividends for a decade. The culprit was Lindsay Corporation (LNN).
Lindsay Corporation, (LNN) provides water management and road infrastructure products and services in the United States and internationally. The company operates through two segments, Irrigation and Infrastructure. Lindsay Corporation hiked its quarterly dividend by 3.20% to 32 cents/share. This marked the 18th consecutive annual dividend increase for this dividend achiever.
During the past decade, the company has managed to grow distributions at an annualized rate of 14.90%. The rate of dividend growth has slowed down to 3.20% over the past five years.
Earnings per share went from $1.98 in 2010 to an estimated $2.75 in 2020. That doesn't strike as a terribly exciting growth, particularly given the fact that earnings estimates are probably on the very optimistic side. Given the rapid deterioration in economic fundamentals, it is difficult to forecast anything today, let alone earnings per share.
Nevertheless, I find it fascinating that this company is selling for 36.80 times forward earnings, which is way too high. The stock yields 1.25%. I would not be interested in the stock at this time, given the slow rate of dividend growth and the high valuation.
While the past week has been slow on dividend increases, I would be watching out for dividend hikes on the following companies:
Procter & Gamble (PG) - PG hiked dividends by 6%.
Johnson & Johnson (JNJ) - JNJ hiked dividends by 6.30%
Exxon (XOM)
Ameriprise Financial (AMP)
Sonoco (SON) - kept dividends unchanged
W.W. Grainger (GWW)
Traveler's (TRV) - Traveler's hiked dividends by 4% to 85 cents/share.
Unilever (UL) - kept dividends unchanged
Costco (COST) - Costco hiked dividends by 7%
IBM (IBM)
Magellan Midstream Partners (MMP)
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