26 Companies That Raised Dividends Last Week
Karin is a member of The Motley Fool Blog Network -- entries represent the personal opinion of the blogger and are not formally edited.
Since I have gotten interested (I should say, obsessed) with dividend-paying companies over the past few months, I have been reading as many articles as I can, and examining other contributors’ methods for choosing the stocks that they feel are the best. In fact, I’ve begun constructing my own model dividend portfolio, which I expect to be able to present to the Motley Fool audience soon.
One of the ways that I narrow down the enormous selection of dividend-paying companies is by choosing a particular list of companies, and then subject those companies to my own criteria, to see if any of the companies will make it to my consideration set.
Today I am examining the 26 companies that announced raises to their dividends during the past week.
These companies are, in alphabetical order, Aaron’s, Atmos Energy, AT&T, Bank Mutual, Barrett Business, Boston Properties, Cogent Communications, DCP Midstream Partners, Devry, Ebix, Emerson Electric, Extra Space Storage, HSN, Kimco Realty, Leggett & Platt, Lincoln Financial, Maiden Holdings, Mesa Labs, Mueller Industries, Spectra Energy, Thermo Fisher Scientific, Universal, Utah Medical, Wendy’s, Western Union, and Whole Foods Market.
Of these 26, I immediately eliminated 16 for yields of less than 3.0%, which is my minimum threshold.
I then sorted for the number of years that each company has been paying and raising dividends. My threshold here is 10 years. This factor knocked five more off the list: DCP Midstream (7 years), Kimco (1 year), Maiden (3 years), Spectra (6 years) and Western Union (3 years).
This left me with 5 companies, four of which I have not examined previously in my dividend analysis.
I then examined the companies for their 5-year Dividend Growth Rate (DGR). I also look at 5-year projected Earnings Growth Rate (EGR) and their total 12-month return. (One reason I look at total return is because I do not want to choose a company whose yield is high simply because the share price has declined precipitously. Such a scenario does not bode well for future growth).
Atmos Energy (NYSE: ATO) is in the natural gas business, and has consistently paid and raised dividends for 24 years. This week it raised its dividend by 3%. It is currently trading at $35, which makes its yield 4.0%. However, the company’s five-year average dividend growth rate (SGR) is a very unsatisfying 1.5%, and it looks as though that 1.5% is generally the standard increase.
Emerson Electric (NYSE: EMR) is an engineering solutions provider, and raised its dividend by 25% this week. Emerson has been paying and raising dividends for a staggering 55 years, is trading at $50 per share, and now yields 3.3%. I like Emerson’s 9.1% DGR, which exceeds my threshold of 7.0%.
Leggett & Platt (NYSE: LEG) is a manufacturer of engineered components and products, and the company has consistently paid and raised dividends for 41 years. The company is currently trading at $27 and raised its dividend by 3.6% this week, so its current yield is 4.3%. Its 5-year DGR is also a healthy 9.9%.
The last company, AT&T (NYSE: T), has been on my radar for a while. It has a 28-year history of raising dividends, and it sports a terrific 5.4% yield. It does, however, have a slightly low 5-year DGR of 6.6%, and this week’s 2.3% increase does not improve that number.
Universal Corp. is a tobacco producer, and that’s where my analysis stops. I do not plan to ever purchase shares in a company that produces tobacco, no matter what its yield or history.
All of this just goes to show me that I have not yet finished seeking out all of the terrific dividend-yielding stocks. I’m adding both Emerson Electric and Leggett & Platt to my list of considerations, and suggest that you do the same.
khern0203 has no positions in the stocks mentioned above. The Motley Fool has no positions in the stocks mentioned above. Motley Fool newsletter services recommend Emerson Electric Co. and AT&T.; Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.If you have questions about this post or the Fool’s blog network, click here for information.