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Recent Dividend Increases

By 52 Comments

moneytruckAs 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. A dividend raise typically means operations are doing well, and management is confident enough about cash flow to give shareholders a raise. All in all, it’s a very good sign.

I try to keep my eyes peeled for dividend raises from companies I’m invested in, as well as companies on my watch list. Some recent dividend increases include:

General Mills, Inc. (GIS) recently gave shareholders a 7.9% raise, increasing the quarterly dividend from $0.38 to $0.41 per share. This now marks 11 years of consecutive dividend raises for this consumer giant. I’m a huge fan of General Mills, but just have not found the right capital at the right time in order to purchase shares. It always seems like another company rises to the top of my list and I buy equity elsewhere. But I do fully plan to own a piece of this company before I’m done accumulating assets. Shares in GIS now yield 3.21% after the raise. Not much to dislike here with the plethora of brands, decent valuation, and attractive yield.

The Bank of Nova Scotia (BNS) increased its quarterly per share dividend from $0.62 CAD to $0.64 CAD, amounting to a 3.2% raise. Dividends with Canada’s most international bank are declared in Canadian Dollars, and after factoring in current exchange rates the dividend in our currency equates to $0.57 per share. The yield on shares with the new payout is 3.96%. I like BNS and it’s currently high on my watch list. Although their dividend growth streak is short, they didn’t cut dividends during the Great Recession. Furthermore, they’ve been raising their dividend twice annually since 2012. I continue to appreciate Bank of Nova Scotia’s international scope and conservative growth.

Raytheon Company (RTN) just yesterday showed shareholders the love with a double-digit dividend raise. The quarterly dividend was increased by a full 10%, as the new payout is now $0.605 per share over the old rate of $0.55 per share. Raytheon now has 10 years of annual dividend growth under its belt. As a shareholder, I really appreciate this dividend raise. RTN has been extremely shareholder friendly over the last few years, and this year is no different. Although I don’t find shares particularly cheap here, I’m happy to hold and collect my rising income. RTN has doubled for me, and some might feel compelled to sell. But as long as RTN keeps delivering raises like this I’m a shareholder for the long term. RTN now yields 2.46% after factoring in the new payout.

Air Products & Chemicals, Inc. (APD) raised its quarterly dividend by 8.5% just hours ago. The new payout of $0.77 per share supersedes the old rate of $0.71. APD has so far been another fantastic investment for me. The company has now managed 32 years of consecutive annual dividend raises. APD is another stock that I don’t find particularly cheap here, with a P/E ratio of 25.61, but I’m happy to continue owning a piece of this company.

Full Disclosure: Long BNS, RTN, APD

Own any of these stocks? Happy with the raises? 

Thanks for reading.

Photo Credit: renjith krishnan/FreeDigitalPhotos.net

Comments

  1. Yes I am happy with all the March raises this year. I might end up with 7 dividend increases for the second month in a row. If only all quarters were as friendly as Q1!

    I just wrote the same post like an hour ago o.O

  2. I own some shares GIS in my ROTH IRA. Pretty good raise and a surprise it was a quarter early. I will definetly take it. Congrats on owning just about all of them on the list. Some solid raises all around. Much more reliable then the current job market where avoiding a pay cut or being let go is considered a big success

  3. I have been waiting for the APD raise. Over 8% is pretty solid! I am extremely happy with the performance since adding shares. The only drawback now is having to add to shares at much higher prices. They are up over 40% from my cost basis.

    Take care!

  4. Dividend increases, the engine that drives the train to freedom! Always good to see high quality companies continuing to reward their shareholders with those size of increases. Like yourself, I’d love to jump into GIS, but capital and opportunity just haven’t aligned themselves just yet.

  5. I definitely want to own GIS. Still waiting for it to come down a few bucks though. If I can catch it at $48, I’ll start to pay closer attention. It’s a hold in my book. Maybe if interest rates start to rise I’ll be able to catch it at the right price.

  6. CI,

    Great minds think alike! Of course, it’s easy to have rising dividend income on our minds, isn’t it? 🙂

    Congrats on a great month for March. You sure know how to pick ’em!

    Best regards.

  8. SWAN,

    I wish I could say I was a fellow shareholder in GIS. One day…

    And I hear you in regards to the dividend raises being much more reliable than job income. I’ve taken a pretty big haircut at work, so your comment is particularly timely for me. The new guy is fully operational now, and I’m about 40% behind last year’s sales for this month. Ouch!

    Keep up the great work!

    Best wishes.

  9. Brent,

    Thanks for stopping by.

    Yeah, I thought the APD raise was more than satisfactory. A bit lower than the 10-year average, but I’ll take this number any day.

    And APD has indeed been on a run. I think it started right around the time it was revealed that Ackman took a big position, if I remember correctly. I don’t know why that would be a good thing as he doesn’t exactly have the Midas touch lately.

    Cheers!

  10. W2R,

    You got it, my friend. The engine that keeps humming us toward financial independence. It’s a sweet sound, isn’t it?

    I wish GIS would fall a bit. I guess I missed my chance last Friday. I’d love to own a piece of the company. So many high quality brands there. Every time I buy a GIS product at the grocery store it makes me angry I don’t own any shares yet. 🙂

    Take care.

  11. Steve,

    I’m with you. I wouldn’t mind initiating a position around $48. It’s been particularly strong lately, but I’m hopeful it’ll fall a bit and we’ll be able to strike. I wish us luck!

    Cheers.

  14. Hi Mr Dividend Mantra,

    I have a question about dividend yield, please. I hope this is an appropriate place to ask it.

    My question: I learned from reading your blog (yay) that dividends are paid per share, but I don’t know what it means when a stock pays an X% yield: the stock pays X% of what number? For example, a stock paying a 4% yield: 4% of what?

    I hope you’ll pardon my very elementary question, but I am brand new to investing.

    Thank you for your blog, and best wishes to you.

  15. *raises the roof*

    Oh yeah! Shooooow meeee the divideeeends!

    Those are very handsome increases from RTN and APD, both of which I own. The dollar amount of the increase is equivalent to investing several thousand dollars in those two companies. Dividend growth is the extra person helping us reach FI.

    I would have had to switch employers to achieve a 10% pay increase! All I have to do is hold on and keep monitoring =).

  17. Nice! Gotta love getting a raise because you own a company and not because you work there. Sadly I own none of these greats! I want to own all of them though, and hope I can get on board soon. I really like GIS and BNS. I’m so motivated lately, but with taxes and dental work I feel the paychecks coming in slow motion. This post is a good reminder that even when times seem tighter than usual, our money is making money without us!

  18. At the moment, Coca-Cola (KO) pays a quarterly dividend of $0.305. Per year, they will pay $1.22. If you buy a share of KO at $ 38.45 today, your current yield will be 1.22/38.45 = 3.17%.

    The yield in % is the annual dividend divided by the current share price.

  19. Hey DM,

    It’s funny to see that everyone has their eyes on GIS. I am also eyeing them, but the price always goes up when I am looking to deploy cash, so it ended up never happening.

    Great dividend increases! I am also looking at BNS and GIS at this point, I will probably go for BNS in April.

    Cheers!

  20. Thank you so much, Dividendatron! I so appreciate you taking the time to explain that to me!

    Best wishes to you. 🙂

  21. Spoonman,

    Thanks. I’m rolling with the punches for now, but I’m also considering all of my options at this point. The changes are occurring right in front of me. It’s unfortunate, but just reinforces why it’s so important to pursue what we’re pursuing.

    Cheers!

  22. JC,

    You’ve had a great March in that case. I’ve been pretty happy with the dividend raises so far this year, other than perhaps WMT.

    I hope it continues. 🙂

    Take care.

  23. Star,

    It sounds like Dividendatron below answered your question. I’m glad you found the answer to your inquiry here. 🙂

    Let me know if you need any other help!

    Best wishes.

  24. Spoonman,

    Your enthusiasm is in good company here. I promise you I feel the same. 🙂

    And once your snowball gets large enough the dividend increases alone are indeed like investing thousands of dollars. Get to $10,000 in annual dividend income, and a 10% across-the-board raise would bring up your dividend income by $1,000. That’s like investing $28,000!! The beauty of dividend growth investing and hypercompounding.

    And I’d have to switch employers just to get back to what I was making last year. We fear dividend cuts, yet I faced what amounts to two portfolios’ worth of dividend cuts with my recent change at work. We’ve gotta keep fighting the good fight!

    Cheers.

  25. Ryan,

    You’ll own a chunk of many companies before you’re done, trust me. 🙂

    “but with taxes and dental work I feel the paychecks coming in slow motion.”

    You took the words right out of my mouth. I just had my temporary crown put in yesterday and with it a significant dental bill. And, of course, I had the big tax bills over the last couple of months. I’ve definitely been slowed lately, but I can’t be stopped!

    Keep up the great work. The progress is already happening right in front of you.

    Best regards.

  27. DV,

    I’m with you on GIS. It’s one I’d love to own a piece of, but the price is never right when I have the capital. I don’t think it’s particularly outrageous here, but I keep finding opportunities elsewhere.

    And not a bad pick on BNS there. I really like that bank over the long haul.

    Take care!

  28. [quote]It sounds like Dividendatron below answered your question. I’m glad you found the answer to your inquiry here. :)[/quote]

    I know, Mr DM, how cool is it that one reader posts a question and another jumps in with an answer!? I appreciate the culture of encouragement that is found here at your blog.

    Looking forward to more of your posts. Best wishes.

  30. Star,

    You’ll find the investment community is filled with wonderfully supportive people. I’m glad to be a part of it and give back in my own small way.

    Stay in touch!

    Best wishes.

  33. Off topic but holy slaughter TIS. Off absolutely no news 20% drop in 2 days..doesn’t this steer you away from micro caps? I know you were watching TIS. I guess you could call this buying opportunity but seriously, 20% in 2 days from no news? No thanks.

  35. took2summit,

    Not exactly no news:

    http://finance.yahoo.com/news/faruqi-faruqi-llp-announces-investigation-232600952.html

    I’m not a fan of the potential dilution, but the dilution as a % of market cap has been well exceeded by this pullback. Another case of Mr. Market overreacting. Of course, with a smaller company like this you might expect that. Part of the shares are set aside for potential purchase, but the other half for compensation is a bit offensive. I hope the vote goes against management.

    Of course, this doesn’t steer me away at all. I’ll be discussing that soon! 🙂

    Cheers.

  38. Hang in there man. Never know what mother employer will send your way or if the winds blow cross-wise and you pollinate a new flower.

    Lots of turmoil in my own place of employment and it simply re-enforces my “will to retire early”. (WTRE)

    Been following you for a while and i would hope the benefits are starting to show with the investment strategy despite the fickle business mistress who likes to dictate all.

    _Z

  39. Jason,

    I factor it in to my own calculations, which ends up being 15% withholding by Canada. However, this is reimbursed to me at tax time, so it’s just a temporary loss.

    From what I understand, holding BNS in an IRA would not come with a 15% withholding by Canada due to our tax treaty with them.

    Best wishes.

  40. financejourney,

    Thanks! Glad you like the new design. I’m extremely happy with it so far.

    BNS and GIS are both great holdings. I hope to join you as a shareholder in GIS in the near future. 🙂

    Best regards.

  41. Zol,

    Thanks for the kind words. I really appreciate the support.

    And while I continue to invest and see wonderful rewards from past hard work, I also keep in mind that the future may bring even bigger opportunities. Life isn’t linear, nor is it static. It’s always changing, and so we must evolve with it. And I look forward to that.

    Hope all is well with your journey as well. Every day is a new opportunity. 🙂

    Best wishes.

  42. Do you still have an eye on tis? I love looking into small cap speculation stocks,fun money only of course. Also what are your thoughts on BDC’s ? Thanks for your time and hard work. We appreciate it.

  43. Fozzy,

    I definitely still have my eye on TIS. I think it qualifies as a spec play, but the solid business model and generous dividend makes it more palatable, at least in my view.

    I’m not a fan of BDCs. They’re spec plays like TIS; however, I don’t know if you really know what you’re investing in. They end up financing many small businesses, and I’ve looked at a few and I can’t really figure out exactly what I’m investing in. With a company like TIS, on the other hand, I pretty much know exactly what I’m investing in. It’s much easier to understand a paper company than it is a VC/PE fund that invests in whatever.

    Just my thoughts on it. I run on the conservative side of things, so that probably biases me against an investment vehicle like a BDC.

    Cheers!

  44. Long both BNS and APD…. when couple of years ago I wanted to pick one “military” staock I was selecting between LMT and RTN, at the end bought LMT and not dissappointing 🙂

  45. gibor,

    Nice! LMT and RTN have both done incredibly well over the last couple years, but I do wish I wouldn’t have passed up on LMT when they were priced about half of what they are today.

    Keep up the great work!

    Best wishes.

  46. interesting you think that article is the source of the decline, as that article was more than a week old once the big drop started happening. what leads you to believe the market reacted 9 days after seeing that article?

  47. took2summit,

    That article was republished elsewhere, and some of these articles were days after the original announcement by the law firm. I’m fairly confident this is why the stock dropped by so much.

    It certainly wouldn’t be the first time (or the last time) the stock market delayed a response.

    Take care!

  48. took2summit,

    And it wouldn’t be 9 days, even from the original announcement.

    The 13th to the 20th is only 7 days. Furthermore, it’s only 5 trading days.

    Take care!

  50. PIE,

    You’ve had a great first quarter in that case. Nothing to dislike with any of these raises. It’s good to be a dividend growth investor right now. 🙂

    Cheers.

  51. Hi investingidiot,

    I just saw that you directed this post to me. Thank you so much for taking the time to share these suggestions.

    Best regards.

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