13 Upcoming Dividend Increases

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Includes: BDX, BRX, CHDN, FUN, HIFS, LANC, MBWM, RGLD, SJI, SYY, UMBF, VFC, WHG
by: Dividend Derek
Summary

All stocks have at least 5 years of dividend growth history.

A dip to 13 companies from 28 last week.

Only VFC has at least a 10% increase.

A new table holding the old and new rates has been added.

Introduction

I love stocks that grow their dividends year in and out. You probably do too! If so, you are in the right place. I've created a list of stocks that are increasing their dividend next week.

New for this week is the table that many of you have asked for. I now have the old and new rates listed (along with the increase percent) in its own table for your enjoyment.

This list is a trimmed-down version only covering dividend increases. A full upcoming dividend calendar is available here. If you know how this was built and the caveats, feel free to jump down to the lists themselves.

How It's Assembled

The information presented below was created by combining the "U.S. Dividend Champion" spreadsheet hosted here, with upcoming dividend information from Nasdaq. This meshes metrics about companies with dividend growth history with upcoming dividend payments (and whether those payments are increasing). These companies all have a minimum 5-year dividend growth history.

Why Should I Care?

Dividend increases are one of the most outward signs by management as to how business is going. Dividend yields also don't live in isolation; share prices tend to follow increases, as investors will move into a stock to claim the new payments. All else being equal, a 10% dividend hike should see an approximately 10% share price appreciation over time as the market adjusts to the higher payment. This produces a great flywheel effect whereby an investor can increase their income and see the face value of their investment increase.

Especially for retirees not receiving paychecks, dividend increases help cushion the never-ending force of inflation. As an added bonus, companies that grow their dividends by a rate greater than inflation can help investors improve their wealth over time.

What these lists provide is an opportunity for an investor to buy more shares prior to the dividend increase. An investor could start a position or increase their position size prior to the market readjusting to the new and higher dividend rate.

What Is The Ex-Dividend Date?

The "ex-dividend" date is the day you are no longer entitled to the dividend or distribution. You need to have made your purchase by the preceding business day. If the date is a Tuesday, you need to have purchased (or already owned) shares by market close on Monday. Be aware that for any stock going ex-dividend on a Monday (or Tuesday, if Monday may be a holiday), you must own it by the prior Friday.

Dividend Streak Categories

Here are the definitions of the streak categories as I'll be using them throughout the piece:

  • King: 50+ years
  • Champion/Aristocrat: 25+ years
  • Contender: 10-24 years
  • Challenger: 5+ years

Fun Facts

Category Count
King 1
Champion 4
Contender 4
Challenger 4

The Main List

The data is sorted by the ex-dividend day (ascending) and then the streak (descending):

Name Ticker Streak Forward Yield Ex-Div Date Increase Percent Streak Category
Cedar Fair, L.P. (FUN) 8 6.8 3-Dec-18 3.93% Challenger
Lancaster Colony Corporation (LANC) 55 1.42 6-Dec-18 8.33% King
Westwood Holdings Group Inc (WHG) 17 7.25 6-Dec-18 5.88% Contender
Mercantile Bank Corporation (MBWM) 7 3.13 6-Dec-18 4.20% Challenger
Churchill Downs, Incorporated (CHDN) 7 0.59 6-Dec-18 7.24% Challenger
V.F. Corporation (VFC) 46 2.55 7-Dec-18 10.87% Champion
Becton, Dickinson and Company (BDX) 46 1.23 7-Dec-18 2.67% Champion
UMB Financial Corporation (UMBF) 27 1.81 7-Dec-18 3.45% Champion
South Jersey Industries, Inc. (SJI) 19 3.65 7-Dec-18 2.50% Contender
Sysco Corporation (SYY) 48 2.33 3-Jan-19 8.33% Champion
Royal Gold, Inc. (RGLD) 17 1.35 3-Jan-19 6.00% Contender
Brixmor Property Group Inc. (BRX) 5 7 3-Jan-19 1.82% Challenger
Hingham Institution for Savings (HIFS) 11 0.67 4-Jan-19 2.80% Contender

Field Definitions

Streak: This is years of dividend growth history sourced from the U.S. Dividend Champions spreadsheet. Here are some definitions to clarify the fields.

Forward Yield: This is the new payout rate divided by the current share price.

Ex-Dividend Date: This is the date by which you need to own the stock.

Increase Percent: This is the amount by which the dividend is being increased.

Streak Category: This is the overall dividend history classification of the company.

Show Me The Money

I received several requests to show the old and new rates so here are those figures. It also reiterates the increase percentage. This table is sorted the same way as the first table (ex-dividend day ascending, dividend streak descending).

Ticker Old Rate New Rate Increase Percent
FUN 0.89 0.925 3.93%
LANC 0.6 0.65 8.33%
WHG 0.68 0.72 5.88%
MBWM 0.24 0.25 4.20%
CHDN 1.52 1.63 7.24%
VFC 0.46 0.51 10.87%
BDX 0.75 0.77 2.67%
UMBF 0.29 0.3 3.45%
SJI 0.28 0.287 2.50%
SYY 0.36 0.39 8.33%
RGLD 0.25 0.265 6.00%
BRX 0.275 0.28 1.82%
HIFS 0.36 0.37 2.80%

Additional Metrics

Here are some additional metrics related to these companies, including yearly pricing action and the P/E ratio. This table is sorted in exactly the same way as the table above. The value investor may find stock ideas with those companies near their 52-week low.

Ticker Current Price 52 Week Low 52 Week High PE Ratio % Off Low % Off High
FUN 54.45 47.9 70.82 15.04 14% Off Low 23% Off High
LANC 183.11 115.81 189.34 34.77 58% Off Low 3% Off High
WHG 39.71 38.69 70.71 14.04 3% Off Low 44% Off High
MBWM 31.94 29.6 38.47 13.81 8% Off Low 17% Off High
CHDN 277.03 219.75 314.6 18.33 26% Off Low 12% Off High
VFC 80.08 70.34 97 38.85 14% Off Low 17% Off High
BDX 249.64 209.91 265.87 567.2 19% Off Low 6% Off High
UMBF 66.35 57 82.14 11.74 16% Off Low 19% Off High
SJI 31.47 25.96 36.72 0 21% Off Low 14% Off High
SYY 66.86 56.01 75.98 23.63 19% Off Low 12% Off High
RGLD 73.82 70.16 98.53 0 5% Off Low 25% Off High
BRX 16.01 13.74 18.83 13.62 16% Off Low 15% Off High
HIFS 219.99 195.05 241.59 14.97 13% Off Low 9% Off High

Tickers By Yield (With Growth Rates)

Some investors are more interested in current yield, so this table is sorted descending by yield. This also includes some of the historical dividend growth rates as a bonus. Additionally, the "Chowder Rule" has been included (the current yield + 5-year dividend growth rate). That is the current yield plus the 5-year dividend growth rate.

Ticker Yield 1 Yr DG 3 Yr DG 5 Yr DG 10 Yr DG Chowder Rule
WHG 7.25 8.8 12.1 10.9 12 18.2
BRX 7 6.1 12.7
FUN 6.8 3.8 6.6 16.6 6.2 23.6
SJI 3.65 3.2 5.1 5.9 8.4 9.4
MBWM 3.13 12.1 15.5 52.4 2.6 55.5
VFC 2.55 12.4 15.8 17.8 11.9 20.3
SYY 2.33 6.5 4.4 4.1 5.7 6.3
UMBF 1.81 4.1 4.3 4.5 6.4 6.3
LANC 1.42 9.8 8.1 9 7.5 10.4
RGLD 1.35 4.3 4.6 9.9 14 11.2
BDX 1.23 8.5 9.6 9.8 11.6 11
HIFS 0.67 6.6 6 5 5 5.7
CHDN 0.59 14.8 14.9 17.1 10.2 17.7

Bonus Charts

V.F. Corp, the owners of such brands as Timberland, The North Face, Lee and Wrangler, is the highlight this week. The company is planning a spinoff of the jeans brands to focus on their core growth brands. Shares have rocketed the past two years even with the recent pullback. Management is giving shareholders another solid increase of 10.8%. This should be their 47th year of consecutive dividend increases.

Running a stock return calculation versus the S&P since November of 2010, shares have crushed the market, returning nearly 21% versus 13% on the S&P. Additionally dividend income would have greatly outpaced the market. This has been a great stock to own over the past eight years.

VFC (the blue line) has been higher than the S&P the entire time during the comparison. Even with the pullback of late, shares still have a wide spread over the return offered by the market. This is where a great dividend growth company can reward shareholders in both capital appreciation and strong income growth.

(Courtesy: Custom Stock Alerts)

Conclusion

I hope you are able to find this information valuable. Let me know if you want to see additional data points or what may help make this more useful.

As always, do your due diligence on any stock before buying or selling.

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.