Thursday, July 11, 2013
Recent Dividend Increases
As a dividend growth investor, one of the primary objectives I seek is passive dividend income from my investments that increases over the rate of inflation, annually. It's always wonderful news when companies decide to reward loyal long-term shareholders with a dividend raise. Some recent dividend increases include:
ConocoPhillips (COP) raised its dividend today by 4.5%. The new quarterly dividend of $0.69 per share will be payable September 3rd, which is a nice bump up from the old rate of $0.66 per share quarterly. There was some chatter about Conoco and whether they would raise the dividend this year. I was never really worried. Although they didn't implicitly raise the dividend of COP shares during the year of 2012, shareholders of COP before the spin-off of the downstream operations in Phillips 66 (PSX) got a huge raise through the newly initiated company and it's own dividend. COP has been an absolutely wonderful investment for me so far, and really one of the best investments I've ever made. In hindsight, the only mistake I made was not buying more COP before the spin-off of PSX. As always, hindsight is 20/20!
Walgreen Company (WAG) yesterday raised its quarterly dividend by 14.5%! The old dividend was $0.275 per quarter per share and the new quarterly per share dividend is $0.315. I really missed the boat on WAG. Shares were trading for ~$30 last summer and I knew deep down inside it was a great opportunity and I let it pass me by for a number of reasons. I regret that now. Shares are now way too expensive for me, but if they dip anywhere near last summer's levels again I'd be extremely interested in adding a piece of this retailer/pharmacy to my portfolio.
Cummins Inc. (CMI) recently raised its dividend by a full 25%! The old rate of $0.50 per share quarterly has been superseded by the new rate of $0.625. A fantastic raise. I think CMI is attractively valued here, and there could be big growth ahead with this company as natural gas engines take hold. We'll see how it goes, but the core business of CMI is very strong. I'd like to have CMI in my portfolio, but the yield is just a tad low for my tastes currently.
Paychex, Inc. (PAYX) raised its quarterly dividend by 6.1% recently, paying out a new dividend of $0.35 per share quarterly over the old rate of $0.33. This new dividend is payable on August 15, 2013, with an ex-dividend date of July 30. PAYX has a spotty dividend growth history, and shares are way too expensive for me right now. It was a nice raise, but overall PAYX does not interest me at today's prices.
What do you think? Enjoying these raises? Own a piece of any of these companies?
Full Disclosure: Long COP, PSX
Thanks for reading.
Photo Credit: FreeDigitalPhotos.net
Edit: Corrected Disclosure