Below are several select companies with a management confident enough to increase their cash dividends:

Calamos Asset Management, Inc. (CLMS) is a globally diversified investment firm offering equity, convertible, defensive equity, fixed- income and alternative investment strategies, among others. February 3rd the company increased its quarterly dividend 27% to $0.095/share. The dividend is payable on March 4, 2011 to shareholders of record on February 18, 2011. The yield based on the new payout is 2.3%.

Aetna (AET) is one of the nation’s leading diversified health care benefits companies, serving approximately 35.4 million people. February 4th the company raised its quarterly dividend to $0.15/share, up from an annual dividend of $0.04/share. The dividend is payable on April 29, 2011 to all shareholders of record as of the close of business on April 14, 2011. The yield based on the new payout is 1.6%.

Temple-Inland Inc. (TIN) is a manufacturing company focused on corrugated packaging and building products. February 4th the company increased its quarterly dividend 18% to $0.13/share, payable March 15, 2011, to shareholders of record March 1, 2011. The yield based on the new payout is 2.2%.

Bemis Company, Inc. (BMS) is a major supplier of flexible packaging and pressure sensitive materials used by leading food, consumer products, healthcare, and other companies worldwide. February 4th the company raised its quarterly dividend 4.3% to $0.24/share. The dividend is payable on March 1, 2011, to shareholders of record at the close of business on February 15, 2011. This marks the 28th consecutive year that the Company has increased its dividend payment. The yield based on the new payout is 2.9%.

Avista Corp. (AVA) is an energy company involved in the production, transmission and distribution of energy as well as other energy-related businesses. February 4th the company increased its quarterly dividend to $0.275/share. The common stock dividend is payable March 15, 2011, to shareholders of record at the close of business on Feb. 18, 2011. The yield based on the new payout is 4.7%.

Jack Henry & Associates, Inc. (JKHY) is a leading provider of computer systems and electronic payment solutions primarily for financial services organizations. February 4th the company increased its quarterly dividend 11% to $0.105/share. The dividend is payable on March 10, 2011, to stockholders of record as of February 22, 2011. The yield based on the new payout is 1.3%.

Owens & Minor, Inc. (OMI) is a leading national distributor of name-brand medical and surgical supplies and a healthcare supply-chain management company. February 7th the company increased its quarterly dividend 13% to $0.20/share. The dividend is payable on March 31, 2011, to shareholders of record as of March 15, 2011. The yield based on the new payout is 2.6%.

Boardwalk Pipeline Partners, LP (BWP) provides interstate transportation and storage of natural gas. February 7th the partnership raised its quarterly distribution to $0.52/unit. The distribution is payable on February 24, 2011, to unitholders of record as of February 17, 2011. The yield based on the new payout is 6.3%.

Infinity Property and Casualty Corporation (IPCC) is a national provider of personal automobile insurance with a concentration on nonstandard auto insurance. February 8th the company increased its quarterly dividend 28.6% to $0.18/share. The dividend is payable on March 25, 2011 to holders of record on March 11, 2011. The yield based on the new payout is 1.2%.

Nationwide Health Properties, Inc. (NHP) is a real estate investment trust (REIT) that invests primarily in healthcare real estate in the United States. February 8th the company raised its quarterly dividend to $0.48/share. The dividend will be paid on March 4, 2011 to stockholders of record on February 18, 2011. The yield based on the new payout is 5.1%.

L-3 Communications (LLL) is a prime contractor in C3ISR (Command, Control, Communications, Intelligence, Surveillance and Reconnaissance) systems, aircraft modernization and maintenance, and government services. February 8th the company increased its quarterly dividend 12.5% $0.45/share. This is the seventh consecutive annual increase in L-3’s quarterly dividend rate. The board has also declared the next dividend payable on March 15, 2011 to shareholders of record at the close of business on March 1, 2011. The yield based on the new payout is 2.2%.

3M (MMM) operates as a diversified technology company worldwide. February 8th the company raised its quarterly dividend 5% to $0.55/share. The dividend is payable on March 12, 2011, to shareholders of record at the close of business on February 18, 2011. The yield based on the new payout is 2.5%.

The Northeast Utilities (NU) engages in the energy delivery business for residential, commercial, and industrial customers in Connecticut, New Hampshire, and western Massachusetts. February 8th the company raised its quarterly dividend to $0.275/share. The dividend is payable on March 31, 2011, to shareholders of record as of the close of business on March 1, 2011. The yield based on the new payout is 3.3%.

Wyndham Worldwide Corporation (WYN) encompasses approximately 7,210 franchised hotels and approximately 612,700 hotel rooms worldwide. February 9th the company increased its quarterly dividend 25% to $0.15/share. The yield based on the new payout is 2.0%.

Service Corporation International (SCI) is the largest provider of deathcare products and services in North America. February 9th the company increased its quarterly dividend 25% to $0.05/share. The dividend is payable on April 29, 2011 to shareholders of record at the close of business on April 15, 2011. The yield based on the new payout is 2.2%.

Diebold, Inc. (DBD) is a global leader in providing integrated self-service delivery and security systems and services. February 9th the company increased its quarterly dividend 3.7% to $0.28/share. The dividend is payable on March 7 to shareholders of record on February 21. This marks the company’s 58th consecutive annual increase. The yield based on the new payout is 3.5%.

Occidental Petroleum Corporation (OXY), the fourth largest U.S. oil and gas company, is an international oil and gas exploration and production company with operations in the United States, Middle East/North Africa and Latin America regions. February 9th the company raised its quarterly dividend 21% to $0.46 per share quarterly dividend will be payable on April 15, 2011, to stockholders of record as of March 10, 2011. Oxy has raised the dividend every year since 2002, raising it 268 percent over the period. The increase brings the company’s compound annual dividend growth rate since 2002 to 15.6 percent. Oxy has paid quarterly dividends continuously since 1975. The yield based on the new payout is 1.9%.

Thomson Reuters (TRI) is the world’s leading source of information for businesses and professionals in the financial, legal, tax and accounting, healthcare, science, and media markets worldwide. February 10th the company increased its quarterly dividend to $0.31/share. The dividend is payable on March 15, 2011 to shareholders of record as of February 22, 2011. This dividend increase marks the 18th consecutive annual dividend increase by the company. The yield based on the new payout is 3.1%.

Textainer Group Holdings Limited (TGH) is the world’s largest lessor of intermodal containers based on fleet size. February 10th the company raised its quarterly dividend 7.4% to $0.29/share. In continuing our record of providing shareholders with sizeable and increasing cash distributions, we have now raised our quarterly payout a total of seven times since going public in October 2007 for a cumulative dividend of $3.29 per common share. The yield based on the new payout is 3.4%.

AGL Resources Inc. (AGL) is an Atlanta-based energy services company, serves approximately 2.3 million customers in six states. February 10th the company raised its quarterly dividend to $0.45 per share is effective for the dividend payable March 1, 2011 to shareholders of record at the close of business on February 18, 2011. The yield based on the new payout is 4.8%.

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: Long MMM. See a list of all my income holdings here.

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(Photo Credit)

Consider the following table:

The first column is the initial yield of the stock. The second column is the dividend growth rate over the period. The final 3 columns are the yields on cost (YOC) after the 5th, 10th and 20th years.  After 10 years, the YOC has either doubled (initial yields of 1%-4%), nearly doubled (initial yield of 5%) of exceeded 10% (initial yields of 6%-9%). After 20 years all the YOCs exceeded 10% except the 1% initial yield. Note that the sum of each initial yield and growth rate equals 12%, which is a nice rule of thumb to look for.

The following dividend stocks have a current yield + growth rate between 10%-12%:

There is no hard and fast rule to what initial yield + growth rate should equal. To be more conservative you could limit your selection criteria to less than 10%. This of course will lower the future YOC, but highlight stocks that should have a greater chance of performing. As always, a careful evaluation should be performed before buying or selling any stock.

Full Disclosure: Long ABT, JNJ, HGIC, KMB, INTC, CTL, PG, KO. See a list of all my income holdings here.

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(Photo Credit)

Entertainment or Equities

The first difficult decision we need to make is to stop buying the “stuff” we want, like wide screen TVs, computers, fancy cars, nice vacations, etc., and instead divert a portion of the money into some form of savings. The inability to exercise this remedial level of self control has put many families on the road to insolvency.

Trading vs. Investing

The desire for instant gratification does not stop once we chose investing over entertainment. Many new investors start out as traders – ‘I want to buy a stock today so I can sell it for a BIG profit tomorrow.’ Very few can succeed doing this, for the rest of us it is a recipe for financial ruin.

Dividend Income vs. Dividend Growth

Even those investors that ultimately end up applying an income-based strategy must still face the question of deferred gratification. Do you want to buy a stock with a high yield and high current income or do you want to buy a stock with a modest, steadily growing dividend? If all stocks were created equal, then this would be a fairly simple question, but they are not.

Dividend Growth Stocks For The Long-Term

Below are several dividend growth stocks that provide a good mix of yield and growth that result in an 8-10% Yield on Cost (YOC) in 10-years:

Last June, I updated you on a retirement-age couple that would never retire because they chose to devote their life to instant gratification – always spending a little more than they made. Since last year, things have continued to go down for Bill and Jackie (not their real names). Due to the economy and health problems, they are unable to generate a steady income. They moved out of their house and stopped making the payments on it. The bank has not yet foreclosed on the house. Their family continues to provide for them, in spite of their own financial issues.

We define our future by the choices we make.

Full Disclosure: Long JNJ, ABT, KMB, CL, HGIC. See a list of all my income holdings here.

(Photo: Steve Woods)

Related Articles:

• What Would Warren Buffett Do?
• Finding Low Risk Dividend Stocks
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• Dividend Stocks: A Disciplined Approach
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Dividend Aristocrats: Companies in the S&P 500 that have followed a policy of consistently increasing dividends every year for at least 25 consecutive years. As the name denotes, these are the best of the best – the blue blood stocks, including names like:

- Clorox Co (CLX) | Yield: 3.30%
- Coca-Cola Co (KO) | Yield: 2.90% | Analysis
- Emerson Electric (EMR)| Yield: 2.80% | Analysis
- Exxon Mobil (XOM)| Yield: 2.60%
- Johnson & Johnson (JNJ)| Yield: 3.10% | Analysis
- McDonald’s Corp (MCD)| Yield: 3.40% | Analysis
- Procter & Gamble (PG)| Yield: 2.80% | Analysis
- Wal-Mart Stores (WMT) | Yield: 2.00% | Analysis

US Broad Dividend Achievers: Is comprised of companies incorporated in the United States or its territories, trade on the NYSE, NASDAQ or AMEX, and have increased their annual regular dividend payments for the last ten or more consecutive years. Notable names on this list include:

- Chevron Corporation (CVX) | Yield: 3.70%
- Donaldson Company (DCI) | Yield: 1.10%
- McCormick & Co. (MKC) | Yield: 2.80%
- Nucor Corp. (NUE) | Yield: 3.20% | Analysis
- Raven Industries, Inc. (RAVN) | Yield: 1.90% | Analysis

The U.S. Dividend Champions: Is maintained by Dave Fish of MoneyPaper. The list is updated monthly and located at the The Drip Investing Resource Center. Like the Dividend Aristocrats above the Dividend Champions list looks for companies that have increased their dividend for at least 25 consecutive years. However, since S&P 500 membership is not a requirement, the list is larger than the Dividend Aristocrats list and also includes small-cap companies.

- Bowl America (BWL.A) | Yield: 4.50%
- Conn. Water Service (CTWS) | Yield: 4.00%
- Weyco Group Inc. (WEYS) | Yield: 2.70%

Needless to say, last year saw many companies fall off the list. Overall the number of constituents fell to 218 stocks in 2010 from 319 in 2009. What made last year so unusual were the number of big-name companies that no longer qualified for inclusion on the list, some that had paid increasing dividends for decades, including:

- American International Group, Inc. (AIG)
– Bank of America Corporation (BAC)
– General Electric Co. (GE)
- The Home Depot, Inc. (HD)
- Johnson Controls Inc. (JCI)
- Pfizer Inc. (PFE)
- US Bancorp (USB)

The news wasn’t all bad. Partially offsetting the 133 companies that fell off the list were 32 new companies joining the Dividend Stock Ideas List. For the most part, these aren’t household names, not yet at least, but here are some names we will likely be seeing in the future:

- Arrow Financial Corporation (AROW) | Yield: 3.90%
- Energy Transfer Partners L.P. (ETP) | Yield: 7.80%
- Federated Investors, Inc. (FII) | Yield: 3.70%
- Getty Realty Corp. (GTY) | Yield: 8.50%
- Hudson City Bancorp, Inc. (HCBK) | Yield: 4.60%
- Investors Real Estate Trust (IRET) | Yield: 7.80%
- NSTAR (NST) | Yield: 4.60%
- Northeast Utilities (NU) | Yield: 3.80%
- Plains All American Pipeline LP (PAA) | Yield: 6.80%
- Suburban Propane Partners LP (SPH) | Yield: 7.30%

You can see the entire Dividend Stock Idea List here. Remember, not every stock listed here is a great dividend investment, but virtually all great dividend investments are on this list.

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

(Photo Credit)

Here is a list of notable participants:

Commerce Bancshares (CBSH) banks provide services to individuals and businesses via 217 branches and 404 ATMs in Missouri, Kansas, Illinois, Oklahoma and Colorado February 5th the company increased its quarterly dividend 3% to $0.235/share. The dividend is payable on March 26, 2010, to stockholders of record at the close of business on March 10, 2010. The ex-dividend date is March 8. CBSH is a Dividend Achiever and has raised its dividend for 42 consecutive years. The yield based on the new payout is 2.49%.

Boardwalk Pipeline Partners (BWP) engages in the interstate transportation and storage of natural gas. February 5th the company bumped its quarterly distribution to $0.50/unit. The distribution is payable on February 22, 2010, to unitholders of record as of February 15, 2010. The ex-distribution date is February 11, 2010. The yield based on the new payout is 6.66%.

Temple-Inland (TIN) is a major producer of corrugated containers and containerboard. February 5th the company boosted its quarterly dividend 10% to $0.11/share. The dividend is payable March 15, 2010, to shareholders of record March 1, 2010. The ex-dividend date is Feb 25th. The yield based on the new payout is 2.59%.

Compass Minerals (CMP) produces salt for highway deicing and general trade. February 8th the company raised its quarterly dividend 10% to $0.39/share. The dividend is payable March 15, 2010, to shareholders of record as of the close of business on March 1, 2010. The ex-dividend date is February 25, 2010. The yield based on the new payout is 2.39%.

Mercury General (MCY) is an insurance holding company operating primarily in California. February 8th the company increased its quarterly dividend 2% to $0.59/share. The dividend is to be paid on March 31, 2010 to shareholders of record on March 16, 2010. The ex-dividend date is March 12, 2010. MCY is a Dividend Achiever and has raised its dividend for 23 consecutive years. The yield based on the new payout is 6.10%.

Jack Henry (JKHY) provides integrated computer systems, software and services addressing the information technology and data processing needs of banks and credit unions. February 8th the company bumped its quarterly dividend 12% to $0.095/share. The cash dividend on its common stock, par value $.01 per share, is payable on March 9, 2010, to stockholders of record as of February 24, 2010. The ex-dividend date is February 22. JKHY is a Dividend Achiever and has raised its dividend for 18 consecutive years. The yield based on the new payout is 1.77%.

United Technologies (UTX) is an aerospace-industrial conglomerate with a portfolio including Pratt & Whitney jet engines, Sikorsky helicopters, Otis elevators and Carrier air conditioners, among other products. February 8th the company boosted its quarterly dividend 10% to $0.425/share. The dividend is payable March 10 to shareowners of record at the close of business Feb. 19. The ex-dividend date is Feb. 17. UTX is a Dividend Achiever and has raised its dividend for 18 consecutive years. The yield based on the new payout is 2.60%. [Analysis]

Owens & Minor (OMI) is a leading domestic distributor of medical and surgical supplies to the acute care market. February 8th the company raised its quarterly dividend 15% to $0.265/share. The record date for the stock split and the cash dividend is March 15, 2010. The cash dividend will be payable on March 31, 2010. OMI is a Dividend Achiever and has raised its dividend for 11 consecutive years. The yield based on the new payout is 2.15%.

Nu Skin (NUS) develops and distributes personal care products and nutritional supplements. February 9th the company increased its quarterly dividend 9% to $0.125/share. The dividend will be paid on March 17, 2010, to shareholders of record on Feb. 26, 2010. The yield based on the new payout is 1.93%.

Avon Products (AVP) is the world’s leading direct marketer of cosmetics, toiletries, fashion jewelry, and fragrances, with more than 5 million sales representatives worldwide. February 9th the company bumped its quarterly dividend 5% to $0.22/share. The dividend is payable March 1, 2010, to shareholders of record February 23, 2010. The ex-dividend date is February 19, 2010. AVP is a Dividend Achiever and has raised its dividend for 21 consecutive years. The yield based on the new payout is 3.00%.

Northeast Utilities (NU) is a utility holding company serves Connecticut, western Massachusetts and New Hampshire. February 9th the company raised its quarterly dividend to $0.25625/share. The dividend is payable March 31, 2010, to shareholders of record as of the close of business on March 1, 2010. The yield based on the new payout is 4.06%.

American Science and Engineering (ASEI) develops, manufactures, markets, and sells X-ray and other inspection solutions primarily for homeland security markets. February 9th the company increased its quarterly dividend to $0.30/share. The dividend is payable on March 4, 2010 to shareholders of record at the close of business on February 22, 2010. The ex-dividend date is February 18, 2010. The yield based on the new payout is 1.61%.

Corporate Executive Board (EXBD) provides corporate executives and professionals with the insights and resources necessary to excel in their roles and to drive corporate performance. February 9th the company bumped its quarterly dividend to $0.11/share. The yield based on the new payout is 2.01%.

3M (MMM) has operations in electronics, health care, industrial, consumer, office, telecommunications, safety and security and other markets. February 9th the company boosted its quarterly dividend 3% to $0.525/share. The dividend is payable on March 12, 2010, to shareholders of record at the close of business on February 19, 2010. The ex-dividend date is February 17, 2010. MMM is a Dividend Aristocrat and has raised its dividend for 52 consecutive years. The yield based on the new payout is 2.62%.

Infinity Property and Casualty (IPCC) provides, through its subsidiaries, personal automobile insurance with a concentration on nonstandard auto insurance. February 9th the company raised its quarterly dividend 17% to $0.14/share. The dividend is payable on March 26, 2010 to holders of record on March 12, 2010. The yield based on the new payout is 1.47%.

Wyndham (WYN) operations include the sale of interests in vacation ownership resorts; facilitating the exchange and rental of access to vacation properties; and the franchising of hotels. February 10th the company bumped its quarterly dividend to $0.12/share. The yield based on the new payout is 2.12%.

Sigma-Aldrich (SIAL) makes and sells a wide range of biochemicals, organic chemicals, and chromatography products. February 10th the company raised its quarterly dividend 10% to $0.155/share. SIAL is a Dividend Aristocrat and has raised its dividend for 34 consecutive years. The yield based on the new payout is 1.33%.

CSX (CSX) a major U.S. rail network, transporting bulk commodities, industrial products and intermodal containers. February 10th the company boosted its quarterly dividend 9% to $0.24/share. The dividend is payable on March 15, 2010 to shareholders of record at the close of business on February 26, 2010. The ex-dividend date is Feb. 24. The yield based on the new payout is 2.13%.

Diebold (DBD) develops, makes, and services self-service transaction systems, electronic and physical security systems. February 11th the company raised its quarterly dividend 4% to $0.27/share. The dividend is payable on Monday, March 8, to shareholders of record at the close of business on Monday, Feb. 22. The ex-dividend date is Feb. 18. DBD is a Dividend Achiever and has raised its dividend for 57 consecutive years. The yield based on the new payout is 3.87%.

SCANA Corp. (SCG) provides electric, natural gas, and telecommunications services. February 11th the company increased its quarterly dividend 1.1% to $0.475/share. The dividend is payable April 1, 2010 to shareholders of record at the close of business on March 10, 2010. The ex-dividend date is March 8, 2010. The yield based on the new payout is 5.43%.

First quarter is an exciting time for dividend growth investors as many companies elect to announce their annual dividend increases during this time. For a list of stocks with a long string of consecutive cash dividend increases, see this list.

Full Disclosure: Long MMM, UTX. See a list of all my income holdings here.

(Photo Credit)

3M Co. (MMM) is a diversified global company has operations in electronics, health care, industrial, consumer and office, telecommunications, safety and security, and other markets. On Wednesday its Board declared a dividend of $0.51/share, a 2% increase. The dividend is payable on March 12, 2009, to shareholders of record at the close of business on February 20, 2009. This is the 51st consecutive year the company has increased its dividend. 3M’s Board also approved an extension to the company’s $7 billion share repurchase authorization which would have expired this month. The stock’s dividend yield is over 4%.

Manulife Financial (MFC) is a Canadian insurer that is among the world’s largest life insurers, offering products and services mostly in North America and Asia. On Thursday, its Board of Directors declared a quarterly dividend of $0.26/share, payable on and after March 19, 2009 to shareholders of record at the close of business on February 25, 2009. The stock’s dividend yield is 5.80%. (stock analysis)

Other companies flexing their financial muscles with higher dividends include:

• Compass Minerals (CMP) Raises Qtr. Dividend to $0.355/share (yield 2.36%)
  
• QNB Corp. (QNBC) Increases Dividend to $0.355 (yield 2.36%)
  
• Terra Nitrogen (TNH) Boosts Qtr. Dividend by 6% to $2.97/unit (yield 10.66%)
  
• Northeast Utilities (NU) Raises Qtr. Dividend by 11.7% to $0.2375/share (yield 4.03%)
  
• Sigma-Aldrich (SIAL) Increases Qtr. Dividend by 11.5% to $0.145/share (yield 1.51%)
• Progress Energy (PGN) Boosts Qtr. Dividend to $0.62/share (yield 6.47%)
• Honeywell (HON) Raises Quarterly Dividend to $0.3025/share (yield 3.80%)
• APCapital (ACAP) Increases Quarterly Dividend 10% to $0.11/share (yield 0.98%)
• Robert Half International (RHI) to Bumps Quarterly Dividend 9% to $0.12 (yield 2.7%)

Finally, the reining dividend champion, Diebold (DBD) increased its dividend 4% to %0.26/share for the company’s 56th consecutive year. The company develops, makes, and services self-service transaction systems, electronic & physical security systems, and software used to equip bank facilities, voting terminals. The stock’s dividend yield is 4.22%.

For other companies around the world with a string of consecutive dividend increases still in tact, see Dividends Value’s Stock Ideas page.

Full Disclosure: Long MFC, PGN

(Photo: Steve Woods)