As part of my monitoring process, I review the list of dividend increases every week. This exercise helps me monitor the progress of existing holdings. It also helps me identify companies for further research. I use this process in conjunction with my screening process.
As part of this process, I look at the companies that raised dividends over the past week. I narrow my focus on companies with an established track record of annual dividend increases. I look for companies that have managed to increase for at least a decade.
I then review the company’s most recent dividend increase, and compare it to the ten year average for perspective.
I also look at the growth in earnings, along with estimated earnings for this year. It is helpful to gain an understanding if the company has been able to grow dividends due to growth in the business. If growth is achieved through expanding the payout ratio, I am generally not interested in such a company.
Last but not least, I review valuation. This includes P/E ratios, dividend yields, but also compare that with historical dividend growth and trends in earnings per share. As you can see, I have come to the conclusion that valuation is more art than science.
During the past week, there were several companies that raised dividends. Each company has at least a ten year track record of annual dividend increases: The companies include:
|
Company |
Symbol |
New Dividend |
Old Dividend |
Raise |
Years Annual Dividend Increases |
Ten Year Annualized Dividend
Growth |
Forward P/E |
Dividend Yield |
|
1st Source Corporation |
SRCE |
0.31 |
0.28 |
10.71% |
35 |
7.38% |
11.01 |
2.56% |
|
American Electric Power Company,
Inc. |
AEP |
0.78 |
0.74 |
5.41% |
12 |
5.20% |
18.2 |
1.42% |
|
Brown & Brown, Inc. |
BRO |
0.1025 |
0.0925 |
10.81% |
28 |
8.32% |
31.28 |
0.62% |
|
Heritage Financial Corporation |
HFWA |
0.21 |
0.2 |
5.00% |
11 |
13.22% |
9.15 |
3.43% |
|
HP Inc. |
HPQ |
1 |
0.7752 |
29.00% |
12 |
16.67% |
8.19 |
2.54% |
|
Hubbell Incorporated |
HUBB |
1.05 |
0.98 |
7.14% |
14 |
9.93% |
22.11 |
2.05% |
|
Lincoln Electric Holdings, Inc. |
LECO |
0.56 |
0.51 |
9.80% |
26 |
13.35% |
23.8 |
1.54% |
|
Magellan Midstream Partners, L.P. |
MMP |
1.0375 |
1.0275 |
0.97% |
21 |
10.95% |
12.13 |
8.09% |
|
Middlesex Water Company |
MSEX |
0.29 |
0.27 |
7.41% |
49 |
3.72% |
46.34 |
1.09% |
|
Prosperity Bancshares, Inc. |
PB |
0.52 |
0.49 |
6.12% |
24 |
11.49% |
13.59 |
2.75% |
|
Stepan Company |
SCL |
0.335 |
0.305 |
9.84% |
54 |
8.71% |
19.19 |
1.10% |
|
Tompkins Financial Corporation |
TMP |
0.57 |
0.54 |
5.56% |
35 |
4.68% |
13.23 |
2.65% |
|
UFP Industries, Inc. |
UFPI |
0.2 |
0.15 |
33.33% |
10 |
14.13% |
11.23 |
0.98% |
As usual, this list is not a recommendation. It just includes a group of companies that have raised dividends last week. These are the types of companies I review, before deciding if I want to put on my list for review or not.
Relevant Articles:
- Five Dividend Growth Stocks Delivering Raises To Shareholders
- Six Dividend Growth Stocks Rewarding Shareholders With Raises
- Five Dividend Growth Stocks In the News