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Investing in dividend stocks is a long-term strategy. Frequent buying and selling of dividend stocks can significantly increase your expenses and taxes, thus lowering your returns. A growing dividend is a strong indication of a company’s increasing intrinsic value. Great companies that increase dividends tend to have rising share prices over time. Holding only first-rate businesses protects your dividend streams and helps ensure you’ll also get steady price appreciation.

Below are several companies building future returns with higher cash dividends:

BCE Inc. (BCE) is a Canadian wireline and wireless telecommunications company. On December 10, the company raised its annual dividend 7.7% to $1.97/share. The dividend is payable on April 15, 2011 to shareholders of record at the close of business on March 15, 2011. The ex-dividend date is March 11, 2011. The yield based on the new payout is 5.5 percent.

Occidental (OXY) maintains global exploration and production operations. Its subsidiary, OxyChem, is one of the largest U.S. merchant marketers of chlorine and caustic soda. On December 10, the company increased its quarterly dividend 21% to $0.46/share. The yield based on the new payout is 2.02 percent.

General Electric (GE) sells products ranging from jet engines and gas turbines to consumer appliances, railroad locomotives and medical equipment. It also owns NBC Universal, and is a leading provider of consumer and commercial financing. On December 10, the company raised its quarterly dividend 17% to $0.14/share. The dividend is payable on Jan. 25 to shareholders of record on December 27. The ex-dividend date is December 22. The yield based on the new payout is 3.27 percent.

Honeywell (HON) is the world’s largest maker of cockpit controls, small jet engines and climate control equipment, and also makes industrial materials and automotive products. On December 10, the company increased its annual dividend 10% to $1.33/share. The yield based on the new payout is 2.55 percent.

Horace Mann (HMN) is an insurance holding company that markets and underwrites personal lines of property and casualty insurance, retirement annuities and life insurance. On December 10, the company raised its quarterly dividend 37% to $0.11/share. The dividend is payable on December 31 to shareholders on record as of December 20. The ex-dividend date is December 16. The yield based on the new payout is 2.48 percent.

Iron Mountain (IRM) provides information protection and storage services. On December 13, the company increased its quarterly dividend 200% to $0.1875/share. The dividend is payable on January 14, 2011 to stockholders of record on December 27, 2010. The ex-dividend date is December 23, 2010. The yield based on the new payout is 3.2 percent.

Dynex Capital (DX) invests principally in single-family residential and commercial mortgage loans and securities. On December 13, the company raised its quarterly dividend 8% to $0.27/share. The dividend is payable on January 31, 2011, to shareholders of record as of December 31, 2010. The ex-dividend date is December 29, 2010. The yield based on the new payout is 1.0 percent.

Pfizer (PFE) is the world’s largest pharmaceutical company. It produces a wide range of drugs across a broad therapeutic spectrum. On December 13, the company increased its quarterly dividend 11.1% to $0.20/share. The dividend is payable on March 1, 2011, to shareholders of record at the close of business on February 4, 2011. The ex-dividend date is February 2, 2011. The yield based on the new payout is 4.68 percent.

Computer Sciences Corp. (CSC) is a computer services company that provides consulting, systems integration and outsourcing services. On December 13, the company raised its quarterly dividend 33% to $0.20/share. The dividend is payable on January 13, 2011, to stockholders of record at the close of business on December 23, 2010. The ex-dividend date is December 21, 2010. The yield based on the new payout is 1.7 percent.

Colony Financial (CLNY) operates as a commercial mortgage REIT that focuses on acquiring and originating commercial real estate mortgage loans and real estate-related debt. On December 13, the company increased its quarterly dividend 20% to $0.30/share. The dividend is payable on January 14, 2011, to stockholders of record on December 31, 2010. The ex-dividend date is December 29, 2010. The yield based on the new payout is 6.1 percent.

Bristol-Myers Squibb (BMY) engages in discovering, developing, and delivering medicines that help patients prevail over serious diseases. On December 14, the company raised its quarterly dividend to $0.33/share. The dividend is payable on February 1, 2011, to stockholders of record at the close of business on January 7, 2011. The ex-dividend date is January 5. The yield based on the new payout is 4.97 percent.

U-Store-It Trust (YSI) engages in the ownership, operation, acquisition, and development of self-storage facilities in the United States. On December 14, the company increased its quarterly dividend 180% to $0.07/share. The dividend is payable on January 21, 2011, to common shareholders of record on January 7, 2011. The yield based on the new payout is 3.1 percent.

NB&T Financial (NBTF) provides commercial banking and financial services to individuals and corporate customers in southwestern Ohio. On December 14, the company raised its quarterly dividend 3.5% to $0.30/share. The dividend is payable on January 24, 2011, to shareholders of record on December 31, 2010. The ex-dividend date is December 29, 2010. The yield based on the new payout is 5.3 percent.

Realty Income (O) leases its retail properties primarily to regional and national retail chain-store operators. On December 15, the company increased its monthly dividend to $0.14425/share. The dividend is payable on January 18, 2011, to shareholders of record as of January 3, 2011. The ex-dividend date is December 31, 2010. O is a dividend achiever, having raised its dividend for 16 consecutive years. The yield based on the new payout is 5.2 percent.

Scholastic Corp. (SCHL) publishes and distributes children’s books, and develops educational technology products, both in the United States and internationally. On December 15, the company raised its quarterly dividend 33% to $0.10/share. The dividend is payable on March 15, 2011, to shareholders of record as of the close of business on January 31, 2011. The ex-dividend date is January 27, 2011. The yield based on the new payout is 1.3 percent.

Moodys Corp. (MCO) provides credit ratings and related research, data, and analytical tools; risk management software; and quantitative credit risk measures and credit portfolio management solutions. On December 15, the company increased its quarterly dividend 9.5% to $0.115/share. The dividend is payable on March 10, 2011, to stockholders of record at the close of business on February 20, 2011. The ex-dividend date is February 17, 2011. The yield based on the new payout is 1.7 percent.

ABM Industries (ABM) provides janitorial, parking, security, engineering, and lighting services for commercial, industrial, institutional, and retail facilities in the U.S. and Canada. On December 16, the company raised its dividend 3.7% to $0.14/share. The dividend is payable on February 7, 2011, to stockholders of record on January 6, 2011. The ex-dividend date is January 4, 2011. ABM is a dividend achiever, having raised its dividend for 16 consecutive years.

Ensign Group (ENSG) provides skilled nursing and rehabilitative care services in California, Arizona, Texas, Washington, Utah, Colorado, and Idaho. On December 16, the company raised its quarterly dividend 10% to $0.055/share. Also on December 16, the company declared a quarterly cash dividend of $0.055 per share, $0.22 annualized. The yield based on the new payout is 1.0 percent.

Waste Management (WM) provides integrated waste management services in North America that includes collection, transfer, recycling, disposal, and waste-to-energy services. On December 16, the company increased its quarterly dividend 8% to $0.34/share. The yield based on the new payout is 3.8 percent.

Autoliv (ALV) develops, manufactures, and supplies automotive safety systems to the automotive industry. On December 16, the company increased its quarterly dividend 14% to $0.40/share. The dividend is payable on March 3, 2011 to shareholders of record on the close of business on February 3, 2011. The ex-dividend date is February 1, 2011. The yield based on the new payout is 2.0 percent.

Pentair (PNR) operates as a diversified industrial-manufacturing company worldwide. The company’s water segment offers products and systems that are used in the movement, storage, treatment, and enjoyment of water. On December 16, the company raised its annual dividend 5% to $0.80/share. PNR is a dividend achiever, having raised its dividend for 34 consecutive years. The yield based on the new payout is 2.2 percent.

Urstadt Biddle (UBA) engages in the acquisition, ownership, and management of commercial real estate properties.On December 16, the company increased its quarterly dividend to $0.245/share. The dividend is payable on January 21, 2011, to stockholders of record on January 7, 2011. The ex-dividend date is January 5, 2011. UBA is a dividend achiever, having raised its dividend for 16 consecutive years. The yield based on the new payout is 5.2 percent.

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 here.

Disclosure: Long O. See a list of all my income holdings here.

Source: 22 Dividend Stocks Building Long-Term Returns