This is why I try to compare the most recent dividend increase relative to the ten year average. In order to get more context, I also review the historical trends in earnings per share along with the near term earnings expectations by Wall Street Analysts (which should be taken with a grain of salt of course).
Over the past week, there were several companies that announced dividend raises to their shareholders. As usual, I focus on companies that have managed to increase dividends for at least a decade. I want companies that can pay and grow dividends throughout the economic cycle.
The companies include:
The Bank of New York Mellon Corporation (BK) provides a range of financial products and services in the United States and internationally. The company operates through Securities Services, Market and Wealth Services, Investment and Wealth Management, and other segments.
The company increased quarterly dividends by 13.50% to $0.42/share. This was the 13th consecutive annual dividend increase for this dividend achiever. Over the past decade, the company has managed to increase dividends at an annualized rate of 10.60%.
Between 2013 and 2022 the company managed to grow earnings from $1.74/share to $2.91/share.
The stock sells for 9.27 times forward earnings and has a dividend yield of 3.86%.
Community Bank System, Inc. (CBU) operates as the bank holding company for Community Bank, N.A. that provides various banking and other financial services to retail, commercial, and municipal customers. It operates through three segments: Banking, Employee Benefit Services, and All Other.
The company increased quarterly dividends by 2.30% to $0.45/share. This is the 31st consecutive year in which the Company has increased its annual dividend. Over the past decade, the company has managed to increase dividends at an annualized rate of 5%.
Between 2013 and 2022 this dividend champion managed to grow earnings from $1.96/share to $3.48/share.
The stock sells for 14.69 times forward earnings and has a dividend yield of 3.59%.
PPG Industries, Inc. (PPG) manufactures and distributes paints, coatings, and specialty materials worldwide. The company operates through Performance Coatings and Industrial Coatings.
The company increased quarterly dividends by 4.80% to $0.65/share. This was the 52nd consecutive annual dividend increase for this dividend king. Over the past decade, the company has managed to increase dividends at an annualized rate of 7.50%.
Between 2013 and 2022 the company managed to grow earnings from $2.97/share to $4.35/share.
The stock sells for 20.30 times forward earnings and has a dividend yield of 1.74%.
Regions Financial Corporation (RF), a financial holding company, provides banking and bank-related services to individual and corporate customers. It operates through three segments: Corporate Bank, Consumer Bank, and Wealth Management.
The company increased quarterly dividends by 20% to $0.24/share. This was the 11th consecutive annual dividend increase for this dividend achiever. Over the past decade, the company has managed to increase dividends at an annualized rate of 33.30%. This would not be possible going forward - the only reason for the high rate was that the bank cut dividends severely over the 2008 - 2009 Global Financial Crisis. It's "easier" to get a high rate of return off a very low base.
Between 2013 and 2022 the company managed to grow earnings from $0.76/share to $2.30/share.
The stock sells for 8.26 times forward earnings and has a dividend yield of 4.80%.
State Street Corporation (STT) provides a range of financial products and services to institutional investors worldwide.
The company increased quarterly dividends by 9.50% to $0.69/share. This was the 13th consecutive annual dividend increase for this dividend achiever. Over the past decade, the company has managed to increase dividends at an annualized rate of 10%.
Between 2013 and 2022 the company managed to grow earnings from $4.52/share to $7.28/share.
The stock sells for 9.60 times forward earnings and has a dividend yield of 3.92%.
Relevant Articles:
- Five Dividend Growth Companies Increasing Distributions to Shareholders
