I review the list of dividend increases each week, as part of my monitoring process. I follow this process in order to monitor existing investments and to potentially identify companies for further research. I focus on quality companies with consistent cashflows, which can be purchased at attractive valuations, which I can then buy and hold forever. These are the types of long-term investments that can deliver rising dividends for decades, while also delivering dependable returns in the process.
This exercise also shows the data points I use in my quick evaluation of a company. This helps me determine if I want to proceed in analyzing a company for potential investment or not. Typically, a promising fundamental development, such as increasing earnings, a sustainable payout ratio and a track record of consistent dividend increases would place a company on my list for further research. I review the growth in earnings and dividends over the past decade, in order to evaluate the likelihood of them continuing their steady march upwards. I also look at valuation together with fundamental performance.
If a company is attractively valued, that's definitely great and increases the chances of it becoming a part of my portfolio, if my analysis doesn't raise any red flags. Even if the company seems overvalued today, I would still review it, in order to be ready to act if it ever becomes cheaper.
Over the past week, there were four companies that have managed to increase dividends for at least a decade, AND also increased dividends last week. The companies include:
National Fuel Gas Company (NFG) operates as a diversified energy company. It operates through four segments: Exploration and Production, Pipeline and Storage, Gathering, and Utility.
The company increased quarterly dividends by 4.20% to $0.495/share. This dividend king has increased annual dividends for 53 straight years.
Over the past decade, the company has managed to grow dividends at an annualized rate of 2.60%.
The company managed to grow earnings from $3.11/share in 2013 to $6.19/share in 2022. The company is expected to earn $5.18/share in 2023.
The stock is selling for 10 times forward earnings and yields 3.81%.
Realty Income (O) is a real estate investment trust with over 12,400 real estate properties owned under long-term net lease agreements with commercial clients.
The company increased monthly dividends by 0.20% to $0.2555/share. This is a 3.23% increase over the dividend paid during the same time last year. This dividend aristocrat has increased dividends multiple times per year since going public in 1994.
Over the past decade, the company has managed to grow dividends at an annualized rate of 5.30%.
Between 2013 and 2022, the company managed to grow FFO/share from $2.41/share to $4.04/share. Realty Income is expected to generate $4.13/share in FFO in 2023.
The stock is selling for 14.85 times forward FFO and yields 5%.
Target Corporation (TGT) operates as a general merchandise retailer in the United States.
The company increased quarterly dividends by a paltry 1.90% to $1.10/share. This is the 52nd consecutive year in which Target has increased its annual dividend.
Over the past decade, the company has managed to grow dividends at an annualized rate of 11.60%.
This dividend king has managed to grow earnings from $3.10/share in 2014 to $6.02/share in 2023. However, earnings are down from the pandemic high of $14.23/share in 2023. The company is expected to earn $8.27/share in 2024.
The stock is selling for 16.19 times forward earnings and yields 3.28%.
W. R. Berkley Corporation (WRB) is an insurance holding company which operates as a commercial lines writer in the United States and internationally. It operates in two segments, Insurance and Reinsurance & Monoline Excess.
The company increased quarterly dividends by 10% to $0.11/share. This is the 22nd year of consecutive annual dividend increase for this dividend achiever.
Over the past decade, the company has managed to grow dividends at an annualized rate of 9.90%.
The company increased earnings from $1.64/share in 2013 to $4.99/share in 2022. The company is expected to earn $4.68/share.
The stock is selling for 12.66 times forward earnings and yields 0.78%.
Relevant Articles:
- Five Dividend Growth Companies Increasing Distributions to Shareholders
- Eight Companies Rewarding Shareholders With a Raise