A dividend boost of a large-cap stock rarely goes unnoticed by investors. The stocks that raised their dividend payouts become more promising to dividend investors since their dividend yields also increase. Moreover, a recent dividend growth may indicate the robustness of the company's financials and suggest further increases in dividend yields down the road. Hence, many stocks with recent dividend boosts not only have decent potential upsides but also are appealing to dividend investors who seek some inflation protection.
We provided a list of 12 Dow Jones Index companies which have either increased dividend payouts in the past few months or announced an increase in payouts in the next quarter. The market data are sourced from Fidelity. These 12 stocks returned 8.39% (including dividends) since the beginning of this year and outperformed the market.
Intel Corp. (INTC) is a global technology company that manufactures microprocessor products. INTC recently announced it would raise its dividend to 21 cents in the third quarter, boosting its dividend yield to 3.65%. INTC gained 10.68% since the beginning of this year, beating the DJI by 2.70%. The stock has a market cap of $122.11B and P/E Ratio of 10.42. Ken Fisher, Jim Simons and Phill Gross are among INTC investors (Check out Jim Simons’ top stock picks).
Johnson & Johnson (JNJ) is a global company that provides consumer healthcare and pharmaceutical products. JNJ raised its dividends from 54 cents to 57 cents last June, boosting its dividend yield to 3.44%. JNJ recently traded at $65.97 and gained 8.47% since the beginning of this year. The stock has a market cap of $181.60B and P/E Ratio of 15.85. Warren Buffett is the most prominent JNJ holder with a $2.5 Billion position. JNJ is one of the most popular stocks among hedge funds (See the 10 most popular stocks among hedge funds).
Procter & Gamble Co. (PG) is a global company that provides a wide range of consumer packaged goods. PG raised its dividends from 48 cents to 52 cents last May, boosting its dividend yield to 3.32%. PG recently traded at $63.09 and returned 0.43% year-to-date. The stock has a market cap of $176.10B and P/E Ratio of 16.60. Warren Buffett also have a massive $4 Billion in PG (See Buffett’s other bullish stock picks here).
General Electric Co. (GE) is a large conglomerate providing technology, media and financial services worldwide. GE raised its dividend a couple of times in the past 12 months. Its last dividend increase was in June, when GE increased its dividend payout to 15 cents. The stock now has a 3.23% dividend yield. GE recently traded at $18.56 and returned 3.00% year-to-date. The stock has a market cap of $196.84B and P/E Ratio of 14.50. Phill Gross, D.E. Shaw and Ken Fisher hold large GE positions.
Chevron Corp. (CVX) is a large US energy company operating worldwide. CVX raised its dividend from 72 cents to 78 cents last May, boosting its dividend yield to 2.90%. CVX gained 19.70% since the beginning of this year, beating the DJI by 11.72% The stock has a market cap of $216.24B and P/E Ratio of 10.44. Warren Buffett had a massive $4 Billion in PG. Phill Gross’ Adage Capital holds more than $300M of CVX (See Phill Gross’ top stocks here).
Travelers Companies Inc. (TRV) is a US company providing insurance services. Last June, TRV boosted its dividend payout by almost 14%, raising its dividend to 41 cents. The stock now has a 2.89% dividend yield. TRV recently traded at $56.80 and returned 3.27% since the beginning of this year. The stock has a market cap of $23.78B and P/E Ratio of 11.14. Mason Hawkins’ Southeastern Asset Management had more than $750M in TRV at the end of March 2011. David Einhorn also has more than $200 Million in TRV. (Check out David Einhorn’s favourite stocks)
JP Morgan Chase (JPM) is a leading financial services firm operating worldwide. Last April, JPM raised its dividend payout by five-fold and paid 25 cents of dividend per share to its investors. The stock now has a 2.41% dividend yield. JPM recently traded at $41.44 and returned -1.07% year-to-date. The stock has a market cap of $164.67B and P/E Ratio of 8.85. Steve Heinz’s Lansdowne Partners has the largest JPM position among the 300-plus funds we are tracking.
Exxon Mobil Corp. (XOM) is a giant US company that manufactures and sells branded motor fuels and related products worldwide. XOM raised its dividend from 44 cents to 47 cents last May, boosting its dividend yield to 2.23%. XOM recently traded at $84.37 and returned 16.65% since the beginning of this year. The stock has a market cap of $415.61B and P/E Ratio of 12.00. Phill Gross and Ken Fisher are large XOM holders with $600 Million positions.
United Technologies Corp. (UTX) is a large US conglomerate providing aerospace technology products and related services worldwide. UTX increased its dividend from 42.5 cents to 48 cents last May, raising its dividend yield to 2.23%. UTX gained 10.63% since the beginning of this year, beating the DJI by 2.65%. The stock has a market cap of $78.13B and P/E Ratio of 16.67. Ken Fisher had more than $500 Million in UTX at the end of March 2011. (Check out Fisher’s favorite stock picks)
Caterpillar Inc. (CAT) is a global corporation that mainly manufactures industrial machinery, engines and related products. CAT increased its dividend from 44 cents to 46 cents this month, raising its dividend yield to 1.75%. CAT gained 13.80% since the beginning of this year, beating the DJI by 5.82%. The stock has a market cap of $67.82B and P/E Ratio of 17.39. Ken Fisher is the most prominent CAT investor, holding more than $750 Million of the stock.
IBM (IBM) is a leading technology and consulting firm operating worldwide. IBM increased its dividend from 65 cents to 75 cents last May, raising its dividend yield to 1.63%. IBM gained 25.70% since the beginning of this year, beating the DJI by a large margin. The stock has a market cap of $221.56B and P/E Ratio of 14.86. Lansdowne Partners has $900 Million in IBM.
Hewlett Packard Co. (HPQ) is a leading IT company providing computer hardware, software and related IT services worldwide. HPQ raised its dividend from 8 cents to 12 cents last June. HPQ has a 1.28% dividend yield but lost 10.53% since the beginning of this year. The stock has a market cap of $77.72B and P/E Ratio of 9.21. John Paulson had a massive $1 Billion in HPQ (See John Paulson’s top stock picks).
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.