4 Dividend Kings, Champions, And Challengers Set To Announce Increases

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Includes: CL, FL, FUL, OXM, SPY
by: Dividend Derek
Summary

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

4 increases for next week (down from 12 last week).

An average increase of 6.1% with only Foot Locker having at least a 10% increase.

Dividend King Colgate-Palmolive (56+ years) has announced their next increase.

Introduction

I'm a huge fan of dividend growth stocks and hope you are too. If you do, you are in the right place! I've compiled a list of stocks that are increasing their dividends next week. This gives investors an opportunity to start or add to a position to capture an upcoming payment. This can be especially important for retirees who live on dividend checks.

This list is a trimmed-down version only covering dividend increases. A full upcoming dividend calendar is always 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 five-year dividend growth history.

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 1
Contender 0
Challenger 2

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
Colgate-Palmolive Company (CL) 56 2.53 17-Apr-19 2.38% King
H. B. Fuller Company (FUL) 49 1.29 17-Apr-19 3.23% Champion
Foot Locker, Inc. (FL) 9 2.48 17-Apr-19 10.14% Challenger
Oxford Industries, Inc. (OXM) 8 1.89 17-Apr-19 8.82% Challenger

Field Definitions

Streak: This is years of dividend growth history sourced from the U.S. Dividend Champions spreadsheet.

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

Here's a table mapping the new rates versus the old rates. 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
CL 0.42 0.43 2.38%
FUL 0.155 0.16 3.23%
FL 0.345 0.38 10.14%
OXM 0.34 0.37 8.82%

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. They may provide a larger margin of safety and inflated yield.

Ticker Current Price 52-Week Low 52-Week High PE Ratio % Off Low % Off High
CL 68.11 57.41 72.61 24.77 19% Off Low 6% Off High
FUL 49.66 39.61 59.58 19.02 25% Off Low 17% Off High
FL 61.24 40.02 68 13.14 53% Off Low 10% Off High
OXM 78.51 63.5 97.19 19.94 24% Off Low 19% 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, which is the current yield + five-year dividend growth rate. I swapped back in the old rates from the CCC list as I work out some kinks with my own calculated rates.

Ticker Yield 1-Yr DG 3-Yr DG 5-Yr DG 10-Yr DG Chowder Rule
CL 2.53 4.4 3.4 4.5 7.8 7
FL 2.48 11.6 11.5 11.5 8.9 14
OXM 1.89 19.4 10.4 13.3 6 15.2
FUL 1.29 4.2 6.4 9.8 8.9 11.1

Bonus Charts

A Dividend King always gets the spotlight for a particular week. It is a tremendous accomplishment to have a business relevant for 50+ years coupled with effective management to increasingly reward shareholders year in and out. With no further ado, here is a little more information on Colgate-Palmolive.

(Source)

While shares have an AA- credit rating and the aforementioned 56 years of dividend growth history, shares seem a little stretched here. EPS is expected to decline year over year with them already starting at 23x earnings. When the whole market tanked during Q4 of 2018, shares seemed more reasonably valued when they dipped just under $60.

From Simply Safe Dividends, the company sports a reasonably great safety score of 88, but it comes at the expense of growth (35) and current yield (44).

(Source)

Running a stock return calculation against the S&P (SPY) since April of 2010, CL lagged the market by about 4.5% per year.

The raw number doesn't tell the whole story though as the returns offered by the two were closely matched for most of the comparison period until the election in November 2016. That phenomenon is visible on the Fast Graph above if you look near the tail end of 2016. Shares were at a high premium leading up to that point and have struggled since. It shouldn't be surprising given that earnings have not grown and shares trade through a P/E range from about 20 to 26 since.

(Courtesy: Stock Return Calculator)

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. Happy investing!

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.