9 Upcoming Dividend Increases, Including Johnson & Johnson

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Includes: ABR, HCSG, IOSP, JNJ, MAR, MCHP, SBSI, TEL, TSCO
by: Dividend Derek
Summary

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

Increases for next week (down from 15 last week).

An average increase of 6.5%, with three sporting at least a 10% increase. Median increase of 4.55%.

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 0
Contender 3
Challenger 5

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
Microchip Technology Incorporated (MCHP) 18 1.7 20-May-19 0.14% Contender
Innospec Inc. (IOSP) 5 1.21 20-May-19 11.11% Challenger
Southside Bancshares, Inc. (SBSI) 24 3.58 22-May-19 3.33% Contender
Arbor Realty Trust (ABR) 7 8.33 22-May-19 3.70% Challenger
Healthcare Services Group, Inc. (HCSG) 17 2.35 23-May-19 0.64% Contender
Marriott International - Class A Common Stock (MAR) 9 1.46 23-May-19 17.07% Challenger
TE Connectivity Ltd. New Switzerland Registered Shares (TEL) 6 2.05 23-May-19 4.55% Challenger
Johnson & Johnson (JNJ) 57 2.78 24-May-19 5.56% King
Tractor Supply Company (TSCO) 9 1.41 24-May-19 12.90% 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 before 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 in 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
MCHP 0.3645 0.3655 0.14%
IOSP 0.45 0.5 11.11%
SBSI 0.3 0.31 3.33%
ABR 0.27 0.28 3.70%
HCSG 0.195 0.1975 0.64%
MAR 0.41 0.48 17.07%
TEL 0.44 0.46 4.55%
JNJ 0.9 0.95 5.56%
TSCO 0.31 0.35 12.90%

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
MCHP 85.78 60.7 104.2 60.4 37% Off Low 17% Off High
IOSP 82.6 53.07 88.84 22.19 53% Off Low 7% Off High
SBSI 34.66 29.26 37.3 15.71 16% Off Low 7% Off High
ABR 13.45 8.79 13.94 10.05 50% Off Low 3% Off High
HCSG 33.56 28.24 48.73 26.94 17% Off Low 31% Off High
MAR 131.89 100.62 142.19 24.48 26% Off Low 7% Off High
TEL 89.89 69.84 99.52 10.72 26% Off Low 9% Off High
JNJ 136.9 118.62 148.99 25.36 14% Off Low 8% Off High
TSCO 99.25 70.52 107.98 22.65 39% Off Low 7% 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.

Ticker Yield 1 Yr DG 3 Yr DG 5 Yr DG 10 Yr DG Chowder Rule
ABR 8.33 36.1 19.1 14.4 -7.3 22.9
SBSI 3.58 11.4 12.8 12.1 13.7 15.7
JNJ 2.78 6.6 6.3 6.4 7 9.2
HCSG 2.35 2.7 2.7 2.8 7.2 5.2
TEL 2.05 9.6 10.4 12.4 11.5 14.5
MCHP 1.7 0.6 0.5 0.6 0.9 2.3
MAR 1.46 20.9 18 19.5 17.3 21
TSCO 1.41 14.3 16.4 19.6 21
IOSP 1.21 15.6 13.4 12.2 24.4 13.4

Bonus Charts

Doing a weekly article series, self-admittedly, there are slower weeks than others. There are certain times of year when activity is high and also particular weeks when perennial favorites show up. This is one of those weeks. For numerous reasons, this week, I'll highlight Johnson & Johnson.

  • Dividend King (57+ years of consecutive increases)
  • One of two AAA-rated companies by S&P (Microsoft (NASDAQ:MSFT) is the other)
  • Possibly the most famous dividend growth company (273k followers here on SA) - more than Coca-Cola (NYSE:KO), Procter & Gamble (NYSE:PG) and 3M (NYSE:MMM).

Johnson & Johnson hardly needs an introduction, so we'll jump into the stats. Using the 15-year F.A.S.T. Graph, shares are about fully valued. There have been several last ticks off the blue line (about a 15.6 P/E ratio) that have been good points to add over the past few years.

(Source)

Shares are hard to find at an extremely attractive entry point since this is one of the safest of all blue chips (the safest?). It visually looks easier to identify the peak points, which look to be about 19x earnings.

From Simply Safe dividends, JNJ rocks it with a safety score of 99, growth of 89, with a middle-of-the-pack yield of 48.

(Source)

The 5.6% increase this year is a tad lower than historical averages across all time ranges. Nevertheless, it is certainly an inflation-beating increase.

Ticker Yield 1 Yr DG 3 Yr DG 5 Yr DG 10 Yr DG Chowder Rule
JNJ 2.78 6.6 6.3 6.4 7 9.2

Running a stock return calculation against the S&P (SPY) since May of 2010, JNJ has been a lagger to the broader market but not by much (12.92% versus 12.18% annualized). Unsurprisingly, you've received much more in terms of dividends than the S&P. The investment results over time of JNJ (blue line) and SPY (black line) were highly correlated over time. There were individual periods that either stood out better than the other, but, generally, they have been highly linked.

(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. Happy investing!

Disclosure: I am/we are long JNJ. 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.