Dividend Raisers: The Few, The Proud

This last week was similar to each of the two prior weeks in that we saw another large bank slash its dividend by more than 80%. Last Friday, Wells Fargo & Company (WFC) cut its dividend by 85% to $0.05. The company said it would help them retain an additional $5 billion in common equity each year.

During the week several big name companies declared dividends, including:

• Safeway (SWY) $0.0828/share - yield 1.87%
• General Mills (GIS) $0.43/share - yield 3.46%
• Microsoft (MSFT) $0.13/share - yield 3.43% - (Analysis)
  
• Heinz (HNZ) $0.415/share - yield 5.40%
  
• Target (TGT) $0.16/share - yielding 2.35% - (Analysis)
• Kraft (KFT) $0.29/share - yield 5.25% - (Analysis)

It is great when companies, like those above, follow through and pay their regular dividends at the appointed time. But it is even more important for companies to follow through and raise their dividend at the appropriate time. Unfortunately, fewer companies are increasing their dividends. This week there were only two to note:

Piedmont Natural Gas Company Inc. (PNY) is an energy services company that distributes natural gas to 1,016,000 residential, commercial and industrial customers in portions of North Carolina, South Carolina and Tennessee. On March 6th, the company declared a 3.8% increase in its quarterly dividend of $0.27/share. The dividend is payable April 15, 2009, to shareholders of record at the close of business on March 25, 2009. The stock now yields 4.85%. This is the 31st consecutive year PNY has raised its dividend. The company is a dividend Achiever and a dividend Champion.

Warwick Valley Telephone Company (WWVY) provides telephone, Internet and video services to customers in the towns of Warwick, Goshen and Wallkill, New York and West Milford and Vernon townships, New Jersey. On March 10th, the company increased its quarterly cash dividend by 10% to $0.22/share up from $0.20/share. The dividend will be paid on March 31, 2009 to shareholders of record as of March 20, 2009. Wisner H. Buckbee, Chairman of the Board, said “This dividend increase demonstrates the Board’s confidence in the continued strong performance of WVT’s business, our cash generation capabilities, and our firm commitment to our shareholders.” The stock now yields 9.78%.

Disclosure: No position in any of the aforementioned securities.

Comments

[notsosmart:]

stop with the english lessons & spelling. learn from the communicationas long as its understand able.my keyboard is old & tired.if einstein misspelled your highness would ignore him.LOL

Mar 14 12:03 PM

[anarchist:]

I am not one to criticize misspelling as I "live in a glass house" and if it were not for spell-check most of my emails would read as if English was my second language-however I DO use the spell-check because I know that to send a message full of typos (even to a friend) implies that I am not interested enough in my communication and the recipients of my communication to correct the spelling, attempt to use correct vernacular and punctuation. I know it is chic in some circles to send illegible emails and thats fine, I just don't want to receive one and especially from someone who is giving me information that might influence an investment decision.

Mar 14 02:50 PM

[Old Trader:]

I only wish to comment on MSFT, having no special insight into any of the other securities mentioned. The ONLY reason Microsoft has something of an appealing yield, is that the stock is plumbing new recent history lows. I had a position for a couple of years (initiated the year after they paid their "special dividend" of $3 at year end. I hoped (in vain), that Gates would realize the firm had changed from a cutting edge tech company, into a mature cash cow, and start rewarding shareholders.

Instead he opted to continued plowing cash into a variety of ill-fated endeavors in an effort to regain the lost "magic". I'm tempted to think that hubris had a role to play in the decision. When I saw that was NOT going to happen any time soon, I sold (albeit at a modest profit).

old trader

Mar 14 09:21 PM

[John M. Lin...:]

Buying Biovale BV and Olin ON was my best stock purchase lately. Great dividends.

Mar 15 04:36 PM