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In compiling the Dividend Champions list (found here: http://dripinvesting.org/Tools/Tools.asp ) I get to see which companies are nearing the anniversaries of their previous dividend increases. Most of these firms raise their payout about the same time every year, but some companies go longer before boosting their dividends, and this can raise concerns about their streaks of increases.

Dividends in Doubt Series

In case you missed it, there was no April article in this series because, by late April, nothing much had changed from the 29 companies listed in late March. No sooner had I posted a Stock Talk to that effect than a slew of changes took place in rapid succession. There are also 29 companies in the list below, but nine of them - the last companies listed - are appearing for the first time. From the March article, there were three deletions: Pitney Bowes (NYSE:PBI), which finally cut its dividend, and "frozen" fiscal-year streaks for Campbell Soup (NYSE:CPB) and Landauer (NYSE:LDR). Another six companies removed themselves from the list by declaring dividend increases. Note that I had previously indicated that CPB and LDR could extend their streaks by increasing dividends to be paid in July, but I decided to delete both after additional analysis. Landauer's Annual Report showed that the company had paid the same amount in all eight quarters of fiscal 2011 and fiscal 2012 (which ended last September). Previously, it appeared that at least one dividend was lower in fiscal 2011, but that was based on the Ex-Dividend Date, not the Pay Date. (I first reversed LDR's promotion to Contender because Fiscal 2012 should not have been counted as its 10th year of higher dividends, meaning that it was deleted as a Challenger.) Meanwhile, Campbell's Chief Financial Officer indicated that the company had no plans to raise the payout this year. So, even though CPB hasn't yet declared its July dividend, I decided to "err on the side of caution" and delete it now, rather than to wait...and keep anyone's hopes up.

This (usually) monthly series lists companies whose latest dividend increases might be considered "overdue" because it has been more than a year since the previous increase, a possible sign that their streaks of increases are in danger. Some firms regularly go more than a year between increases, so this is only an "early warning" sign that some of them may warrant concern. This month, I've again sorted the Champions, Contenders, and Challengers together, in order of their most recent increase (NYSE:PAY) dates. Except as noted below, the companies through listed through Kinross Gold have until the end of 2013 to declare dividend increases and extend their streaks. The remaining companies paid at least one lower amount in 2012, so they'll automatically pay more in 2013, unless they cut their dividend, so their streaks are "safe" until the end of 2014. Note that companies with dates in 2011 managed to pay their shareholders more in total during 2012 because the former was split between two rates, whereas the latter was composed of payments that all came at the higher rate instituted at the time of the last increase.

 

 

Company

Ticker

No.

4/30

Div.

Pay

Ann.

EPS%

TTM

FYE

Name

Symbol

Yrs

Price

Yield

Date

Div.

Payout

P/E

Month

Columbia Sportswear Co.

(NASDAQ:COLM)

7

58.60

1.50

6/2/11

0.88

30.14

20.07

12

Molson Coors Brewing B

(NYSE:TAP)

5

51.60

2.48

6/15/11

1.28

52.67

21.23

12

Tower Group Inc.

(NASDAQ:TWGP)

6

18.92

3.96

6/24/11

0.75

n/a

n/a

12

Birner Dental Mgmt Svcs

(NASDAQ:BDMS)

9

17.89

4.92

7/8/11

0.88

123.94

25.20

12

NuStar Energy LP

(NYSE:NS)

12

50.08

8.75

8/12/11

4.38

n/a

n/a

12

Juniata Valley Financial

(OTCQB:JUVF)

22

17.75

4.96

9/1/11

0.88

102.33

20.64

12

National CineMedia Inc.

(NASDAQ:NCMI)

6

16.24

5.42

9/1/11

0.88

366.67

67.67

12

Cablevision Systems Corp.

(NYSE:CVC)

5

14.86

4.04

9/9/11

0.60

500.00

123.83

12

Kaydon Corp.

(NYSE:KDN)

6

23.84

3.36

10/3/11

0.80

4000.00

1192.00

12

Frisch's Restaurants Inc.

(NYSEMKT:FRS)

6

16.32

3.92

10/10/11

0.64

51.61

13.16

5

Acme United Corp.

(NYSEMKT:ACU)

9

12.80

2.19

10/24/11

0.28

24.35

11.13

12

Natural Resource Partners

(NYSE:NRP)

10

23.88

9.21

11/14/11

2.20

111.68

12.12

12

Westamerica Bancorp

(NASDAQ:WABC)

21

43.39

3.41

11/18/11

1.48

52.48

15.39

12

American Science&Eng.

(NASDAQ:ASEI)

5

64.48

3.10

12/1/11

2.00

94.79

30.56

3

United Bankshares Inc.

(NASDAQ:UBSI)

39

25.31

4.90

1/3/12

1.24

75.15

15.34

12

PennantPark Investment

(NASDAQ:PNNT)

6

11.70

9.57

1/3/12

1.12

86.15

9.00

9

National Instruments Corp.

(NASDAQ:NATI)

10

27.33

2.05

3/5/12

0.56

76.71

37.44

12

Kinross Gold Corp.

(NYSE:KGC)

5

5.44

2.94

3/31/12

0.16

n/a

n/a

12

Communications Systems

(NASDAQ:JCS)

10

9.82

6.52

4/1/12

0.64

246.15

37.77

12

Constellation Software Inc.

(OTCPK:CNSWF)

6

137.57

2.91

4/2/12

4.00

91.53

31.48

12

Teekay LNG Partners LP

(NYSE:TGP)

8

41.69

6.48

5/14/12

2.70

174.19

26.90

12

Boardwalk Pipeline Part.

(NYSE:BWP)

7

30.23

7.05

5/17/12

2.13

166.41

23.62

12

BOK Financial Corp.

(NASDAQ:BOKF)

8

62.49

2.43

5/29/12

1.52

29.57

12.16

12

Somerset Hills Bancorp

(NASDAQ:SOMH)

8

11.49

2.79

5/31/12

0.32

50.79

18.24

12

ConocoPhillips

(NYSE:COP)

12

60.45

4.37

6/1/12

2.64

44.67

10.23

12

Span-America Medical

(NASDAQ:SPAN)

14

19.69

2.54

6/6/12

0.50

27.17

10.70

10

Gorman-Rupp Company

(NYSEMKT:GRC)

40

28.25

1.42

6/8/12

0.40

29.85

21.08

12

CCFNB Bancorp Inc.

(OTCQB:CCFN)

15

37.00

3.57

6/14/12

1.32

40.62

11.38

12

G&K Services Inc.

(NASDAQ:GK)

7

46.99

1.66

6/22/12

0.78

47.85

28.83

6

TTM=Trailing Twelve Months; FYE=Fiscal Year End

As mentioned above, most of the companies listed have until the end of 2013 or 2014 in order to "save" their streaks with a dividend increase. Two of the Challengers have streaks tied to their Fiscal Years, which will act as their "deadline" for another increase. ASEI and FRS have until March 2014 and May 2014, respectively, to declare increases. Other companies with different fiscal years have regular calendar-year streaks.

Note that companies with Pay Dates that are less than a year old have already declared an unchanged next dividend, so they will become 'overdue' with that dividend payment. Other companies will join this list as they pass the anniversaries of their previous increases without hiking their dividends. Since the determinant for inclusion revolves around the Dividend Payment, that Date is listed above, along with the Payout Ratio and the Price/Earnings ratio, two key indicators of a company's ability to increase the payout.

Assessing Risk

Some companies, such as REITs (Real Estate Investment Trusts) and MLPs (Master Limited Partnerships), are structured to pay out more than earnings per share, so we can't easily tell from seemingly high payout ratios or P/Es just how risky they are. Some seemingly alarming ratios might suggest great risk, but a look ahead at the estimated earnings per share for this year or next might prove a bit more comforting. Companies with shorter streaks may be more likely to allow them to lapse, since they haven't yet established long histories (or "cultures") of rewarding shareholders with growing dividends. As always, comments and suggestions are welcome below.

Source: 29 'Overdue' Dividend Increases: Streaks In Jeopardy