Dividend growth investing is a long-term strategy. A growing dividend is a sign that the company is becoming more valuable. Companies that consistently increase dividends tend to have steadily rising share prices and the best way to benefit from this is to buy and hold the stocks. Diversification and a focus on blue-chip stocks provides insurance for the few companies that don’t pan out.
Below are some companies that are increasing shareholder wealth by raising their cash dividends:
General Mills (GIS) is a major producer of packaged consumer food products, including Big G cereals and Betty Crocker desserts/baking mixes. June 28th the company increased its quarterly dividend 17% to $0.28/share. The dividend is payable August 2, 2010, to shareholders of record July 12, 2010. The ex-dividend date is July 8, 2010. The yield based on the new payout is 3.15%. Ken Powell, DIS’s Chairman and Chief Executive Officer stated, “Strong and growing cash dividends are an important component of General Mills’ total return to our shareholders. The dividend increase announced today is a reflection of our company’s robust financial condition and excellent future growth prospects.”
MSC Industrial (MSM) is direct marketer focusing on maintenance, repair and operations supplies. June 30th the company increased its quarterly dividend 10% to $0.22/share. The dividend is payable on July 27, 2010 to shareholders of record at the close of business on July 13, 2010. The ex-dividend date is July 9, 2010. The yield based on the new payout is 1.74%.
Freeport McMoRan Copper and Gold Inc. (FCX) is the world’s second largest copper producer. June 24nd the company raised its quarterly dividend 100% to $0.30/share. The dividend is payable on August 16, 2010, to shareholders of record at the close of business July 15, 2010. The yield based on the new payout is 2.03%.
Government Properties Income Trust (GOV) is a real estate investment trust, or REIT, which owns properties leased primarily to the U.S. Government and state governments located throughout the United States. July 1st the company increased its quarterly dividend. The dividend is payable shareholders of record as of the close of business on July 16, 2010 and distributed on or about August 16, 2010. The yield based on the new payout is 6.31%.
Selecting stocks with increasing dividends is critical for an income growth strategy. The above list contains stocks that recently raised their dividends, it is not a list of recommend buys. As always, due diligence should be performed before buying or selling any stock. For a list of stocks with a long string of consecutive cash dividend increases, see this list.
Full Disclosure: No position in the aforementioned securities. See a list of all my income holdings here.