Dividend Increases: July 22-26, 2019 (Part 2: Financials Sector)

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Includes: BAC, BXS, EFSC, HFWA, NTRS, PFG, RF, WAFD, WFC, ZION
by: FerdiS
Summary

Monitoring dividend increases for stocks on my watch is one way to identify candidates for further analysis.

This is Part 2 of a three-part article summarizing dividend increases announced last week.

This article covers the Financials sector.

One way to identify dividend growth stocks for further analysis is to monitor dividend increases. Companies that regularly raise their dividend payments show confidence in future earnings growth potential.

I look for dividend increase announcements for stocks in the CCC List, but I use several screens to limit the number of stocks to monitor:

  • Dividend yield ≥ 1.0%
  • Market cap ≥ $1 billion
  • No stocks that are being acquired
  • No Over-The-Counter or Pink Sheet stocks

This week, 30 companies that declared dividend increases passed these screens. Of these, ten are stocks in the Financials sector, of which I own one in my portfolio. See Part 1 for dividend increases in the Utilities and Energy sectors, and Part 3 for coverage of the remaining sectors.

The following table presents a summary.

The table is sorted by the percentage increase, %Incr. Dividends are annualized and in US$, unless otherwise indicated. Yield is the new dividend yield for the market close Price on the date listed. Yrs are years of consecutive dividend increases, while 5-yr DGR is the compound annual growth rate of the dividend over a 5-year period. 1-yr %Incr is the percentage increase from the year-ago dividend. (Some companies increase their dividends more than once a year, so this puts the most recent dividend increase in context.)

Summary of Dividend Increases: July 22-26, 2019

Previous Post: Dividend Increases: July 15-19, 2019

Bank of America (BAC)

BAC, through its subsidiaries, provides banking and financial products and services to individual consumers, institutional investors, corporations, and governments worldwide. It operates in the Consumer Banking, Global Wealth & Investment Management, Global Banking, and Global Markets segments. BAC was founded in 1874 and is headquartered in Charlotte, North Carolina.

On July 25, the board of directors declared a quarterly dividend of 18¢ per share. The new dividend represents an increase of 20.00%. The dividend is payable on September 27 to shareholders of record on September 6. BAC will trade ex-dividend on September 5.

Northern Trust Corp. (NTRS)

NTRS is a financial holding company that provides asset servicing, fund administration, asset management, and fiduciary and banking solutions for corporations, institutions, families, and individuals around the world. The company operates in the United States and internationally. NTRS was founded in 1889 and is based in Chicago, Illinois.

On Tuesday, July 23, NTRS increased its quarterly dividend to 70¢ per share, an increase of 16.67%. The new dividend is payable on October 1 to shareholders of record on September 13, with an ex-dividend date of September 12.

Zions Bancorporation (ZION)

Founded in 1873 and based in Salt Lake City, Utah, ZION is a financial services company that provides banking and related products and services in the western United States. ZION offers retail banking services, residential mortgages, trust and wealth management services, and a variety of loan products for commercial and residential development and construction.

Recently, ZION increased its quarterly dividend by 13.33% to 34¢ per share. The dividend is payable August 22, with an ex-dividend date of August 14.

Wells Fargo (WFC)

WFC is a diversified, community-based financial services company founded in 1852 and headquartered in San Francisco. It provides banking, insurance, investments, mortgage, and consumer and commercial finance products and services. WFC has offices in 36 countries to support customers who conduct business in the global economy.

The company announced an increase of its quarterly dividend of 13.33% to 51¢ per share. The dividend is payable on September 1 to shareholders of record on August 9. The stock will trade ex-dividend on August 8.

Regions Financial Corp. (RF)

RF is a financial holding company that conducts its banking operations through Regions Bank, an Alabama state-chartered commercial bank. The company offers commercial banking services, consumer banking products and services, and wealth management products and services. RF was founded in 1971 and is headquartered in Birmingham, Alabama.

On Wednesday, July 24, RF increased its quarterly dividend to 15.5¢ per share, an increase of 10.71%. The dividend is payable on October 1 to shareholders of record on September 6. The stock will trade ex-dividend on September 5.

BancorpSouth Bank (BXS)

BXS provides commercial banking and financial services to individuals and small-to-medium sized businesses in Alabama, Arkansas, Florida, Louisiana, Mississippi, Missouri, Tennessee, Texas, and Illinois. The company offers various deposit products, commercial and consumer loans, residential mortgage loans, insurance products, and investment brokerage services. BXS was founded in 1876 and is headquartered in Tupelo, Mississippi.

The board of directors of BXS has declared a quarterly dividend of 18.5¢ per share. The new dividend is 8.82% above the prior dividend of 17¢ per share. The dividend is payable on October 1 to shareholders of record at the close of business on September 13.

Enterprise Financial Services Corp. (EFSC)

EFSC offers banking and wealth management services to individuals and corporate customers in the St. Louis metropolitan area, the Kansas City metropolitan area, and the Phoenix metropolitan area. The company’s offerings include deposit accounts, loan products, and financial advisory and investment management services. EFSC was founded in 1988 and is headquartered in Clayton, Missouri.

Recently, EFSC increased its quarterly dividend to 16¢ per share, an increase of 6.67% over the prior dividend of 15¢ per share. The stock will trade ex-dividend on September 12, and shareholders can expect to receive the new dividend on September 27.

Heritage Financial Corp. (HFWA)

HFWA is a bank holding company incorporated in the State of Washington in August 1997. Its wholly owned subsidiary, Heritage Bank, is a full-service commercial bank providing financial solutions to small and medium-sized business in Washington and Oregon. Effective May 1, 2014, HFWA completed a merger with Washington Banking Company.

HFWA will pay a quarterly dividend of 19¢ per share, an increase of 5.56% over the previous quarterly dividend. The dividend is payable August 22, with an ex-dividend date of August 7.

Washington Federal (WAFD)

WAFD is a non-diversified unitary savings and loan holding company. Its principal subsidiary is Washington Federal, National Association. The company attracts savings deposits from the general public and invests these funds in loans secured by first mortgage liens on single-family dwellings. WAFD was founded in 1917 and is headquartered in Seattle, Washington.

The company increased its quarterly dividend by 5.00%, from 20¢ per share to 21¢ per share. The dividend is payable on August 23 to shareholders of record on August 9. WAFD will trade ex-dividend on August 8.

Principal Financial Group (PFG)

Based in Des Moines, Iowa, PFG is a leading provider of retirement services, insurance solutions, and asset management services. In addition, the company offers individual life and disability insurance, group life and health insurance, and residential mortgage loan origination and servicing products in the United States. PFG was founded in 1879.

Recently, PFG increased its quarterly dividend by 1.85% to 55¢ per share. It will trade ex-dividend on September 4. The dividend is payable on September 27, to shareholders of record on September 5.

Please note that I'm not recommending any of these stocks. Readers should do their own research on these companies before buying shares.

Below, I'm including charts from F.A.S.T. Graphs for three of this week's dividend raisers: NTRS, WFC, and WAFD.

In these charts, the black line represents the share price and the blue line represents the calculated P/E multiple at which the market has tended to value the stock over time. The orange line is the primary valuation reference line. It is based on one of three valuation formulas depending on the earnings growth rate achieved over the time frame in question. (The Adjusted Earnings Growth Rate represents the slope of the orange line in the chart.)

NTRS's price line (black) is at the primary valuation line (orange) and below the stock's normal P/E ratio (blue). The stock is trading at a discount to fair value. An investment in NTRS in October 2010 would have returned 13.7% on an annualized basis (with dividends included).

WFC's price line is below the stock's normal P/E ratio and below the primary valuation line. The stock is trading at a discount to fair value. An investment in WFC in January 2010 would have returned 8.8% on an annualized basis (with dividends included).

WAFD's price line is below the primary valuation line and at the stock's normal P/E ratio. The stock is trading at about fair value. An investment in WAFD in October 2010 would have returned 9.4% on an annualized basis (with dividends included).

Upcoming Ex-Dividend Dates

As a bonus, here is a summary of available ex-dividend dates for the next two weeks. You must own a stock before its ex-dividend date to be eligible to receive the next dividend.

The table is sorted by Ticker, and as before, Next Div is annualized. Please note that the table contains only ex-dividend dates of stocks in the Financials sector. See Part 1 for ex-dividend dates of stocks in the Utilities and Energy sectors and Part 3 for coverage of the remaining sectors.

Summary of Upcoming Ex-Dividend Dates: July 30-August 12, 2019

Company

Ticker

Yield

RecentPrice

Yrs

5-YrDGR

NextDiv.

Ex-DivDate

Pay- ableDate

Ameriprise Financial

AMP

2.59%

$149.93

15

11.90%

$3.88

08/02

08/16

TD Ameritrade

AMTD

2.31%

$52.05

9

19.00%

$1.20

08/05

08/20

Berkshire Hills Bancorp

BHLB

2.84%

$32.42

5

4.10%

$0.92

08/07

08/22

Boston Private Financial

BPFH

4.11%

$11.69

6

14.90%

$0.48

08/08

08/23

Citizens Financial

CFG

3.82%

$37.68

6

N/A

$1.44

07/30

08/14

Columbia Banking System

COLB

3.00%

$37.34

9

19.50%

$1.12

08/06

08/21

Eaton Vance

EV

3.06%

$45.76

38

9.30%

$1.40

07/30

08/15

Great Western Bancorp

GWB

3.54%

$33.93

5

N/A

$1.20

08/08

08/23

Heritage Financial

HFWA

2.69%

$28.22

9

17.60%

$0.76

08/07

08/22

Independent Bank Group

IBTX

1.76%

$56.95

6

35.10%

$1.00

08/02

08/15

Investors Bancorp

ISBC

3.90%

$11.27

7

37.10%

$0.44

08/08

08/23

Lazard

LAZ

4.87%

$38.60

12

12.70%

$1.88

08/02

08/16

LegacyTexas Financial

LTXB

2.33%

$42.95

9

10.80%

$1.00

08/02

08/19

Metlife

MET

3.47%

$50.69

7

13.00%

$1.76

08/05

09/13

Morgan Stanley

MS

3.06%

$45.74

5

40.60%

$1.40

07/30

08/15

Northwest Bancshares

NWBI

4.20%

$17.15

10

6.30%

$0.72

07/31

08/15

OceanFirst Financial

OCFC

2.64%

$25.71

5

5.30%

$0.68

08/02

08/16

People's United Financial

PBCT

4.23%

$16.77

27

1.50%

$0.71

07/31

08/15

1st Source

SRCE

2.29%

$47.07

32

9.20%

$1.08

08/02

08/15

S&T Bancorp

STBA

2.83%

$38.21

6

10.20%

$1.08

07/31

08/15

Westamerica Bancorporation

WABC

2.56%

$64.12

28

1.40%

$1.64

08/02

08/16

Washington Federal

WAFD

2.30%

$36.51

9

14.20%

$0.84

08/08

08/23

Webster Financial

WBS

3.12%

$51.26

9

17.80%

$1.60

08/02

08/19

Wells Fargo

WFC

4.14%

$49.30

9

7.40%

$2.04

08/08

09/01

WSFS Financial

WSFS

1.15%

$41.88

6

21.30%

$0.48

08/07

08/22

Wintrust Financial

WTFC

1.39%

$71.74

6

33.40%

$1.00

08/07

08/22

Update, July 30, 2019, 10:20 a.m.: The table above has been updated to reflect corrected "next dividend" dates for a number of companies.

Thanks for reading and happy investing!

Disclosure: I am/we are long WFC. 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.