Growing up in the late 60s early 70s, I spent a fair amount of time reading comic books. I don’t remember much about them, but I do remember several of classic ads. Of course, there was the Charles Atlas ad where the beach bully kicked sand on the skinny boy and his girlfriend. But the ad that I remember the best was the “Magnificent Marvelous Money Machine.“ It was a wooden block with some rollers in which you would put a one dollar bill in one side and a five dollar bill would come out the other.
Being very young and naive, my mom had a tough time convincing me that it was just a trick and something like that didn’t really exist. Sorry mom, but you were wrong on this one. The “Magnificent Marvelous Money Machine” does exist, but it has a different name. It is called Dividend Growth Stocks.
Below are several companies that are multiplying their shareholders return by increasing their cash dividends:
ConocoPhillips (COP) explores for, produces, transports and markets crude oil, bitumen, natural gas, liquefied natural gas and natural gas liquids on a worldwide basis. July 11, the company increased its quarterly dividend 4.5% to $0.69 per share. The dividend is payable September 3, 2013, to stockholders of record at the close of business on July 22, 2013. The yield based on the new payout is 4.3%.
Paychex, Inc. (PAYX) provides payroll, human resource, and benefits outsourcing solutions for small to medium-sized businesses in the United States and Germany. July 11, the company increased its quarterly dividend 6% to $0.35 per share. The dividend is payable August 15, 2013, to shareholders of record August 1, 2013. The yield based on the new payout is 3.6%.
Enterprise Products Partners L.P. (EPD) provides midstream energy services to producers and consumers of natural gas, natural gas liquids (NGLs), crude oil, refined products, and petrochemicals in the United States and internationally. July 10, the company increased its quarterly dividend 1.5% to $0.67 per share. The dividend is payable August 7, to the holders of record at the close of business on July 31. The yield based on the new payout is 4.2%.
Walgreen Co. (WAG) operates a network of drugstores in the United States. July 10, the company increased its quarterly dividend 14.5% to $0.315 per share. The dividend is payable September 12, 2013, to shareholders of record August 20, 2013. The yield based on the new payout is 2.6%.
Cummins Inc. (CMI) designs, manufactures, distributes and services diesel and natural gas engines, and engine-related component products. July 9, the company increased its quarterly dividend 25% to $0.6250 per share. The dividend is payable on September 3, 2013, to shareholders of record on August 22, 2013. The yield based on the new payout is 2.2%.
KLA-Tencor Corporation (KLAC) designs, manufactures, and markets process control and yield management solutions for the semiconductor and related nanoelectronics industries. July 9, the company increased its quarterly dividend 12.5% to $0.45 per share. This increase is expected to take effect beginning with KLA-Tencor's quarterly dividend to be declared in August 2013. The yield based on the new payout is 3.0%.
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.
Disclosure: Long COP in my Dividend Growth Portfolio. See a list of all my dividend growth holdings here.