Investors looking for dividend income should also consider stocks with growing earnings per share (EPS) for total return. While the current income is nice, stocks with growing EPS can increase income in the future and provide capital appreciation due to increasing net income. Each of the following stocks pay more than 3.0% in dividend yield and have price upside of 25% or more in the next year.
Himax Technologies INC (HIMX) has a current dividend yield of 3.78%. The dividend has increased 297% in the past year. EPS growth reported in the last quarter was up 14% compared to a year ago. EPS is projected to increase 42.6% next year compared to the current year.
Himax Technologies, Inc. designs, develops and markets semiconductors for flat panel displays. The stock is up an enormous 300% in the past year as it has exceeded earnings estimates in the each of the last two quarters. Recently, Google Inc. (GOOG) disclosed taking a 6.3% stake in the company's display unit, which makes chips used in Google's Glass headset. Google stated that this investment is an extension of the partnership, which we hope will allow the team to continue to develop its operations.
On June 17, 2013, the board of directors at Himax Technologies Inc approved a dividend of $0.25 per share. This was an increase of 297% from the previous dividend payout of $0.06 per share. The company has no debt and pays dividends on an annual basis. Pursuant to the company's $25 million share buyback program, it has purchased a total of $13.4 million, or approximately 9.5 million ADS, through March 31, 2013.
For Q1 2013, net income increased by 24.0% to $14.0 million from $11.3 million in Q1 2012. GAAP earnings per diluted ADS grew by 24.2% to 8.2 cents from 6.6 cents in Q1 2012. Total revenues increased by 5.4% year-over-year to $175.7 million. Small and medium-sized panel driver sales increased by 26.1% year-over-year, representing 51.9% of total revenues in Q1 2013.
The stock currently trades at a price earnings ratio of 21 but has a 5-year projected PEG ratio of only 0.75. Based on forward EPS of $0.62, Himax has a 12-month price target of $9.30. This is an increase of 40% from the stock's current price.
RLJ Lodging Trust (RLJ) has a current dividend yield of 3.43%. The dividend has increased 24% in the past year. EPS growth reported in the last quarter was up 72% compared to a year ago. EPS is projected to increase 35% next year compared to the current year.
RLJ Lodging Trust is a self-advised, publicly traded real estate investment trust focused on acquiring premium-branded, focused-service and compact full-service hotels. The company owns 149 properties, comprised of 147 hotels with approximately 22,300 rooms and two planned hotel conversions, located in 22 states and the District of Columbia.
Net income attributable to common shareholders for the three months ended June 30, 2013, was $40.5 million, compared to $18.9 million in the comparable period in 2012. For the six months ended June 30, 2013, net income attributable to common shareholders was $49.0 million, compared to $12.4 million in the comparable period in 2012.
Adjusted FFO for the three months ended June 30, 2013, increased $19.0 million to $74.8 million, representing a 34.1% increase over the comparable period in 2012. For the six months ended June 30, 2013, Adjusted FFO increased $34.5 million to $118.8 million, representing a 41.0% increase over the comparable period in 2012. Adjusted FFO per diluted share and unit for the three and six months ended June 30, 2013, was $0.61 and $1.03, respectively.
The Company's Board of Trustees declared a cash dividend of $0.205 per common share of beneficial interest in the second quarter.
Based on forward EPS of $2.30, RLJ Lodging Trust has a 12-month price target of $30.00. This is an increase of 25% from the stock's current price.
Cracker Barrel Old Country Store (CBRL) has a current dividend yield of 3.05%. The dividend has increased 87.5% in the past year. EPS growth reported in the last quarter was up 25.9% compared to a year ago. EPS is projected to increase 16.3% next year compared to the current year.
Aside from outstanding EPS growth, shares have increased on expectations that Cracker Barrel will buy back some or all of shareholder Sardar Biglari's stake, a move that would help per-share earnings for fiscal 2014. Mr. Biglari, who owns a roughly 20% stake and has unsuccessfully fought to gain a seat on Cracker Barrel's board, has rejected the offer, saying he intends to be a long-term shareholder.
For the quarter ended April 27 2013, Cracker Barrel reported a profit of $24.6 million, or $1.02 a share, versus a year-prior profit of $19 million, or 81 cents a share. Excluding one-time items, earnings a year earlier were 86 cents a share. For the latest quarter, Cracker Barrel had projected earnings between 90 cents to 95 cents a share.
Revenue increased 5.2% to $640.4 million. Analysts polled by Thomson Reuters most recently projected $631 million.
On June 3, 2013, the board of directors at Cracker Barrel approved a dividend of $0.75 per share which is a 50% increase from previous levels.
Based on forward EPS of $4.85, Cracker Barrel has a 12-month price target of $120.00. This is an increase of 28% from the stock's current price.