Dividends Value » CTAS

16 Dividend Stocks Growing Future Yield *

D4L — Fri, 29 Oct 2010 07:30:11 +0000

In the southern U.S. where I live, there has been some controversy over harvesting forests of hardwoods and reseeding them with pines. Growing hardwoods is very similar to investing in dividend stocks. What you plant or invest in today will not yield much for years to come. That is not to say progress is not seen. It is just slow and deliberate. To grow hardwoods it takes great foresight and commitment to the process. The small investments we make in quality dividend stocks each month won’t yield large payments in the near-term. It will take time for the payments to grow and compound, but they will.

Below are several companies planting the seeds for future yield by increasing their cash dividends:

El Paso Pipeline (EPB) owns and operates natural gas transportation pipelines and storage assets. October 22nd the partnership increased its quarterly distribution 2.5% to $0.41/unit. The distribution is payable November 15, 2010, on all outstanding common and subordinated units to holders of record as of the close of business on November 1, 2010. The ex-dividend date is October 28, 2010. The yield based on the new payout is 4.90%.

Coca-Cola Enterprises (CCE) is the world’s largest bottler of Coca-Cola beverage products. October 25th the company raised its quarterly dividend 33% to $0.12/share. The dividend is payable December 9, 2010 to shareholders of record on November 26, 2010. The ex-dividend date is November 24, 2010. The yield based on the new payout is 1.99%.

NuStar Energy L.P. (NS) is a leading independent operator of crude oil and refined products pipelines as well as terminal storage facilities. October 25th the partnership increased its quarterly distribution 1% to $1.075/unit. The distribution is payable on November 5, 2010, to holders of record as of November 1, 2010. The ex-distribution date is October 28, 2010. The yield based on the new payout is 6.82%.

PartnerRe Ltd. (PRE) is a global multi-line reinsurance company provides coverage in approximately 150 countries. October 25th the company raised its quarterly dividend 10% to $0.55/share. This marks the second increase in the common share dividend this year. The dividend is payable on December 1, 2010, to common shareholders of record on November 19, 2010, with the stock trading ex-dividend commencing November 17, 2010. The yield based on the new payout is 2.51%.

Linn Energy (LINE) is an independent natural gas and oil company develops and acquires properties in Texas Panhandle and Los Angeles Basin. October 25th the partnership increased its quarterly dividend 5% to $0.66/unit. The distribution is payable on Nov. 12 to shareholders of record on Nov. 4. The ex-dividend date is Nov. 2. The yield based on the new payout is 7.89%.

Holly Energy Partners (HEP) owns and operates refined product pipeline and terminal facilities. October 26th the partnership raised its quarterly distribution 1.2% to $0.835/unit. This increase marks the twenty-fourth consecutive quarterly increase. The distribution will be paid November 12, 2010, to unitholders of record November 5, 2010. The ex-dividend date is November 3, 2010. The yield based on the new payout is 6.65%.

American Electric Power (AEP) is an electric utility holding company has subsidiaries operating in 11 states in the U.S. October 26th the company increased its quarterly dividend 9.5% to $0.46/share. The dividend is payable on Dec. 10 to shareholders of record on Nov. 10. The ex-dividend date is Nov. 8. The yield based on the new payout is 5.02%.

Rogers Communications (RCI) is a Canadian communications and media company operates in three segments: Wireless, Cable, and Media. October 26th the company raised its quarterly dividend 4.1% to $0.32/share. The dividend is payable on January 4, 2011 to shareholders of record on November 18, 2010. The ex-dividend date is November 16, 2010. The yield based on the new payout is 3.54%.

Molex (MOLX) makes electrical and electronic devices primarily for OEMs in the computer, telecommunications, home appliance, and home entertainment industries. October 26th the company increased its quarterly dividend 14.8% to $0.175/share. The dividend is payable on January 25, 2011 to shareholders of record on December 31, 2010. The ex-dividend date is December 29, 2010. The yield based on the new payout is 3.40%.

Cintas (CTAS) operates a corporate identity uniform business and also provides entrance mats, cleaning services and supplies, first aid products, along with document management and shredding services. October 26th the company raised its annual dividend 2% to $0.49/share. The dividend is payable on December 15, 2010, to shareholders of record as of November 12, 2010. The ex-dividend date is November 10. CTAS is a Dividend Aristocrat and has raised its dividend for 27 consecutive years. The yield based on the new payout is 1.81%.

UMB Financial (UMBF) owns four commercial banks, a brokerage company, a community development corporation, a consulting company, mutual fund servicing company and 14 subsidiaries. October 27th the company increased its quarterly dividend 5.4% to $0.195/share. The dividend is payable on December 30, 2010 to shareholders of record at the close of business on December 10, 2010. The ex-dividend date is December 8, 2010. UMBF is a Dividend Achiever and has raised its dividend for 20 consecutive years. The yield based on the new payout is 2.15%.

RPC (RES) provides a range of specialized oilfield services and equipment primarily to independent and oil and gas companies. October 27th the company raised its quarterly dividend 16.7% to $0.07/share and also announced a three-for-two split of the company’s common shares. The dividend is payable December 10, 2010 to common stockholders of record at the close of business on November 10, 2010. The ex-dividend date is November 8, 2010. The yield based on the new payout is 1.20%.

Arrow Financial (AROW) offers commercial and consumer banking and financial products in U.S. October 27th the company increased its quarterly dividend 3.1% to $0.25/share. The dividend is payable December 15, 2010 to shareholders of record December 3, 2010. The ex-dividend date is December 1, 2010. AROW is a Dividend Achiever and has raised its dividend for 20 consecutive years. The yield based on the new payout is 3.91%.

TAL International (TAL) leases of intermodal freight containers, and also engages in container management and sales. October 27th the company raised its quarterly dividend 14.3% to $0.40/share. The dividend is payable on December 23, 2010 to shareholders of record at the close of business on December 2, 2010. The ex-dividend date is November 30, 2010. The yield based on the new payout is 6.42%.

Strayer Education (STRA) offers academic programs via traditional classroom and online courses. October 28th the company increased its quarterly dividend 33% to $1.00/share. The dividend is payable on December 10, 2010 to shareholders of record as of November 26, 2010. The ex-dividend date is November 24, 2010. The yield based on the new payout is 3.16%.

Parker Hannifin (PH) is a global maker of industrial pneumatic, hydraulic, and vacuum motion/control systems, including related pumps, valves, filters, hoses, etc. Its products are used in everything from jet engines to trucks and autos and utility turbines. October 28th the company raised its quarterly dividend 7.4% to $0.29/share. The dividend is payable December 3, 2010 to shareholders of record as of November 10, 2010. The ex-dividend date is November 8, 2010. PH is a Dividend Achiever and has raised its dividend for 55 consecutive years. The yield based on the new payout is 1.53%.

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 stocks. See a list of all my income holdings here.

(Photo Credit)

The 2010 Dividend Aristocrats *

D4L — Wed, 16 Dec 2009 10:30:02 +0000

The S&P 500 Dividend Aristocrats is the most prestigious list of dividend stocks. The Dividend Aristocrats index is designed to measure the performance of S&P 500 constituents that have followed a policy of consistently increasing dividends every year for at least 25 consecutive years. This index is a member of the S&P Dividend Aristocrats index series.

Dividend Aristocrats constituents exhibit the following characteristics:

Underlying Indices – S&P 500
Weighting – Equally weighted; Constituents re-weighted quarterly
Reconstitution – Reviewed annually in December

Among others, Dividend Aristocrats include these highly recognizable names, with years of consecutive dividend increases shown:

Clorox Co (CLX) – 32 years
Coca-Cola Co (KO) – 47 years – [Analysis]
Exxon (XOM) – 27 years
Johnson & Johnson (JNJ) – 47 years – [Analysis]
McDonald’s Corp (MCD) – 33 years – [Analysis]
Procter & Gamble (PG) – 53 years – [Analysis]
Wal-Mart Stores (WMT) -35 years – [Analysis]

Members may be deleted during the December rebalance if calendar-year dividends did not increase from the previous year, or intra-year if the stock is removed from the underlying S&P 500.

On December 4th, S&P announced changes to the Dividend Aristocrats Index. Standard & Poor’s will perform the annual reconstitution of the S&P 500 Dividend Aristocrats Index after the close of trading on Friday, December 18, 2009.

The following stocks will be added to the Dividend Aristocrats:

Brown-Forman Corporation (BF.B)
Cintas Corp. (CTAS)

The following stocks will be dropped from the Dividend Aristocrats:

Avery Dennison Corporation (AVY)
BB&T Corp. (BBT)
Gannett Co., Inc. (GCI)
General Electric Co. (GE)
Johnson Controls Inc. (JCI)
Legg Mason Inc. (LM)
M&T Bank Corp. (MTB)
Pfizer Inc. (PFE)
State Street Corp. (STT)
US Bancorp (USB)

As the number of drops vs. adds indicates, the last two years were difficult for dividend stocks, but that is not necessarily a bad thing. During good times it is easy for companies to increase dividends, and many companies were added to the index. It is during times of adversity that we learn who the real aristocrats are.

Full Disclosure: Long CLX, KO, JNJ, MCD, PG, WMT. See a list of all my income holdings here.

(Photo Credit)

Bank of America Headed Back to the TARP ATM *

D4L — Fri, 16 Jan 2009 11:30:00 +0000

Someone once said that there is no such thing as bad publicity. I think Bank of America (BAC) would take exception to that statement. BAC has been in the news all week and it has not been flattering or reassuring to it shareholders. This once proud dividend aristocrat continues to struggle even after slashing its dividend.

Monday, Citigroup (C) issued some cautious comments on BAC and said investors should be braced for a very challenging 4Q. C cut Q4 EPS estimates, expects another dividend cut and expects the company raise fresh capital, but will wait for a better environment. Ultimately, C sees cumulative credit losses of $165 billion for 2008-2011, with only about 33% recognized so far.

Yesterday it was reported that BAC needs more aid from the government for its Merrill Lynch acquisition. To date, BAC has received $25 billion from the Treasury Department’s Troubled Assets Relief Program (TARP). According to the The Wall Street Journal, BAC needs additional assistance to deal with an ugly quarterly report from Merrill. By mid-day Thursday shares were down 20% to around $8.

Not all news was bad this week. Instead of looking for a government handout, several companies continue to increase the cash given to their shareholders through higher dividends. Here are a few:

Robbins & Myers (RBN) Increases Dividend to $0.04/share (Yield 0.96%)
CVS Caremark (CVS) Boosts Qtr. Dividend 10.5% to $0.0725 (Yield 1.1%)
Cintas (CTAS) Boosts Annual Dividend to $0.47 (Yield 2.02%)
Linear Technology (LLTC) Boosts Qtr. Dividend to $0.22/share (Yield 3.98%)
Monsanto (MON) Boosts Qtr Dividend 10% to $0.265 (Yield 1.38%)
Pentair (PNR) Boosts Qtr. Dividend from $0.17 to $0.18 (Yield 2.97%)
Shaw Communications (SJR) Raises Annual Dividend to $0.053 (Yield 3.80%)
Family Dollar (FDO) Raises Qtr. Dividend by 8% to $0.135/share, (Yield 1.89%)

When BAC cut its dividend it no longer met the criteria for inclusion in my income portfolio. There is a reason that my most basic investing rule is to immediately sell a stock after it cuts its dividend; I BAC sold at $28.51/share after its first dividend cut.

Disclosure: No position in the aforementioned securities.

(Photo: Steve Woods)