Dividend Contenders: 22 Increases Expected By The End Of August

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Includes: BG, BMI, CMI, CPKF, DGAS, DUK, EBMT, FRFC, FTS, KR, LNN, LSTR, MXIM, PSBQ, R, SJM, SPAN, STE, SXT, TCP, WTR
by: David Fish

Summary

Aqua America to become the next Dividend Champion.

Will Cummins deliver the best percentage increase?

How high will Duke Energy's yield go?

In compiling the Dividend Champions list (found here). I get to see which companies are nearing the anniversaries of their previous dividend increases. Since most of these firms raise their payout about the same time every year, I can say with some confidence that they are likely to do so again. I have separated the Champions (25 or more years of higher dividends), Contenders (10-24 years), and Challengers (5-9 years) into distinct groupings, so please look for the other articles, which I hope will be published about the same time. Note that "CCC" refers to the combination of Champions, Contenders, and Challengers.

Dividend Growth Vacation

The lazy, hazy days of Summer are upon us and, much like the rest of the world, Dividend Growth takes a "vacation" each year about this time of year. As I spelled out back in 2011, in this article, the frequency of dividend-increase announcements is lowest in July (by ex-dividend dates), at just 3.1%. Generally, that means that June and July are the slowest point for such announcements, after which a brief surge occurs in August and beyond. Keep that in mind the next time you see an article proclaiming the "death" of dividend growth; you simply can't judge a long-term trend by "vacation" numbers!

The number of announcements for all Champions, Contenders, Challengers, and Near-Challengers expected in the next 11 weeks has actually increased from just 63 a month ago to 78 now, still in the "below average" category, but up slightly due to a small surge in August. I would expect the overall activity to remain relatively light until late in the third quarter and heading into the usual heavier activity in this year's fourth quarter and the first quarter of 2017.

The table below coincides with the usual "forward look" of about 11 weeks for this article. Based on last year's announcements, I'm expecting the following companies to announce dividend increases between now and the anniversary of the Ex-Dividend Date of their previous increase:

Dividend Contenders (10-24 years):

Company

Ticker

No.

5/31

Div.

MR%

LY

Ann.

DGR

Name

Symbol

Yrs

Price

Yield

Inc.

Ex-Div

Div.

5-yr

John Wiley & Sons Inc.

(JW-A)

22

53.88

2.23

3.45

7/2/15

1.20

14.5

PSB Holdings Inc.

(OTCPK:PSBQ)

22

45.85

1.83

5.00

7/10/15

0.84

5.0

TC Pipelines LP

(NYSE:TCP)

16

55.23

6.45

5.95

7/31/15

3.56

3.3

Sensient Technologies Corp.

(NYSE:SXT)

10

68.22

1.58

8.00

8/5/15

1.08

5.7

Landstar System Inc.

(NASDAQ:LSTR)

11

67.85

0.47

14.29

8/6/15

0.32

9.6

Aqua America Inc.

(NYSE:WTR)

24

32.31

2.20

7.88

8/12/15

0.71

7.8

J.M. Smucker Co.

(NYSE:SJM)

18

129.15

2.08

4.69

8/12/15

2.68

11.1

Kroger Company

(NYSE:KR)

10

35.76

1.17

13.51

8/12/15

0.42

15.2

Eagle Bancorp Montana Inc.

(NASDAQ:EBMT)

16

12.58

2.46

3.33

8/12/15

0.31

2.0

Duke Energy Corp.

(NYSE:DUK)

11

78.23

4.22

3.77

8/12/15

3.30

2.2

Lindsay Corp.

(NYSE:LNN)

13

71.34

1.57

3.70

8/13/15

1.12

27.2

Span-America Medical Sys.

(NASDAQ:SPAN)

17

63.58

1.01

6.67

8/14/15

0.64

9.2

Bunge Limited

(NYSE:BG)

15

67.07

2.50

10.53

8/17/15

1.68

10.4

Maxim Integrated Products

(NASDAQ:MXIM)

14

37.96

3.16

7.14

8/18/15

1.20

7.2

Cummins Inc.

(NYSE:CMI)

10

114.47

3.41

25.00

8/19/15

3.90

32.0

Ryder System

(NYSE:R)

11

69.62

2.36

10.81

8/20/15

1.64

8.9

Steris Corp.

(NYSE:STE)

11

69.43

1.44

8.70

8/21/15

1.00

13.0

Badger Meter Inc.

(NYSE:BMI)

23

75.00

1.07

5.26

8/27/15

0.80

8.4

Chesapeake Financial

(OTCQB:CPKF)

23

19.38

2.48

6.67

8/28/15

0.48

9.3

Delta Natural Gas

(NASDAQ:DGAS)

11

25.00

3.28

2.50

8/28/15

0.82

4.0

ITC Holdings Corp.

(ITC)

11

44.52

1.68

15.38

8/28/15

0.75

9.9

First Robinson Financial

(OTCPK:FRFC)

15

38.00

3.05

11.54

8/31/15

1.16

5.3

MR=Most Recent; LY=Last Year; DGR=Dividend Growth Rate through 2015

Not all of the above companies will meet the strict standards of every investor, but some may be appropriate for portfolio diversification. Potential investors should do more research before committing funds.

Every Picture Tells a Story

As a bonus, I'm inserting one of Chuck Carnevale's F.A.S.T. Graphs below, highlighting one of the companies listed above. When the stock's price line has moved into the green area, it indicates that the stock is undervalued in relation to its earnings. I'm attaching the chart below.

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Editor's Note: This article covers one or more stocks trading at less than $1 per share and/or with less than a $100 million market cap. Please be aware of the risks associated with these stocks.

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