Dividend Stocks: 6 More Increases in the News

I regularly check the wires for companies which are increasing dividends. That way I have another control which would enable me to find promising dividend growers to add to my watchlist for accumulation. This week there were several companies announcing healthy dividend raises to shareholders.

Emerson Electric (EMR),a diversified global technology company, announced that its Board has approved a 10.00% increase in its quarterly dividend from $0.30 to $0.33 per common share effective fourth quarter of 2008. Emerson Electric is a dividend aristocrat which has increased its dividends for over fifty one years. The stock currently yields 3.80%.

Aqua America, Inc. (WTR), a regulated utilities that provides water or wastewater services in the United States, announced that its Board has approved an 8.00% increase in its quarterly dividend to $0.135 per common share effective fourth quarter of 2008. Aqua America is a dividend achiever which has increased its dividends for over two decades. The stock currently yields 3.20%.

Teekay Offshore Partners L.P. (TOO) announced that its Board has approved a 12.50% increase in its quarterly dividend from $0.40 to $0.45 per common share. The stock currently yields 14.70%.

Royal Gold (RGLD), which engages in acquiring and managing precious metals royalties, announced that its Board has approved a 14.00% increase in its quarterly dividend from $0.07 to $0.08 per common share. Royal Gold could be an interesting way to invest in gold rather than purchasing the metal outright. The stock currently yields only 1.10% however.

Perrigo Company (PRGO) announced that its Board has approved a 10% increase in its quarterly dividend from $0.05 to $0.055 per common share. Perrigo has more than doubled its quarterly dividend since 2003. The stock currently yields only 0.60%.

Aaron Rents, Inc. (RNT) announced that its Board has approved a 6.30% increase in its quarterly dividend from $0.016 to $0.017 per common share. The stock currently yields only 0.30%.

I think that Aqua America looks like an interesting water play. CNBC’s High Net Worth mentioned that water is going to be the next oil during the current century as more people around the world demand clean water. I will be researching WTR further down the road.

Disclosure: Author is long EMR.

Comments

[You're Kidding:]

I appreciate your research and time, but except for TOO, I haven't the faintest idea why you wrote this article. The rest of the stocks here are paying much too low of a dividend to be interesting. Why not spend your time writing about ones with higher dividends?

2008 Nov 10 12:28 AM

[notsosmart:]

check out FRO & NAT.i have no agenda. i own both,happily.

2008 Nov 10 08:54 AM

[Dividend Gr...:]

As part of my research I am trying to uncover stocks that have sustainable dividend growth. Dividend Growth investing focuses on future yields and total returns, not just dividend yields. It's true that stocks like FRO and NAT have high dividend yields right now which is mainly due to the fact that they are also returning a portion of their capital back as well. This might not be a sustainable business model especially in the current credit freeze, since generous distributions as a return of capital are generally funded by expansion by selling extra stocks or bonds. Furthermore I believe that stocks which pay out most of their earnings and then some could get particularly vulnerable to unfavorable conditions.

I am a bigger fan of stocks that have average market yields but spot the opportunity for above average dividend growth. WMT is a prime example of that - no one bought WMT for their yield, but yet their total returns and dividend growth were exceptional.

I do agree with you that some of the stocks do have a very small dividend yield and not so good dividend growth. The bright spots are WTR and EMR. If these stocks could double their dividends in 10 years or less, you will be getting a very decent yield on cost..

As for most shipping stocks, the volatility in dividends is not something I enjoy. I guess I would have to explain the dividend growth investing concept in more detail.

2008 Nov 10 09:17 AM

[granger:]

High dividend yield is not the key YOUR KIDDING. The article is about companies that are growing their dividend.

Keep the great info coming. I look forward to any ideas on water in general.

I know their are some water ETF's. I currently own DHR and FELE for my water exposure.

Is there any equity play on water rights?

2008 Nov 11 05:55 AM

[henarl:]

Consider writing covered call options to supplement dividend income. Also look at MLPs and income trusts for good dividends and dividend growth.
Long PRO, OSG, KMP, OKS, BPT, PBT, HTE

2008 Nov 11 11:36 AM

[Foosie:]

WTR has one of the best CEO's in that industry. Unfortunately, about 85 percent of water companies in the U.S. are owned by municipalities and are not publicly traded. However, more and more municipal systems are hiring companies such as WTR to manage their municipal water company (less graft that way)....but the politicians do not want to give up ownership...

2008 Nov 11 06:54 PM