We are closing in on fall. Football season is right around the corner, along with post-season baseball. The Browns are the darlings of the NFL so far. So let's just say football is the talk of the town these days. But let's not forget how much dividend increases are discussed as well. Maybe not by the city, but definitely by Lanny and I. Heck, we are on the lookout 24/7 trying to find new dividend growth investments to add to our portfolios. For those of you that are new to our website, each month, we predict the companies that are expected to announce a dividend increase in the coming month. Let's review the expected dividend increases in September!
Actual Dividend Increases in August 2019
Each month, prior to looking ahead, we review the previous month's article to see the results. We predict the dividend increases. So why not follow through and talk about the actuals! Here are the results for the five companies featured in last month's article.
- Company #1: Illinois Tool Works (ITW) - An interesting company to start of this recap. ITW didn't shake the world like it did last year when announcing a 28% dividend increase. In fact, the 7% dividend increase announced is significantly lower than that mark. This is much lower than its average, but not surprising given the global uncertainty today. My guess is that the company went the conservative route in 2019 and will return to larger dividend growth with a clearer global forecast in 2019.
- Company #2: Scotts-Miracle Gro (SMG) - My predictions last month must have been while I was wearing rose-colored glasses. While I projected a nice dividend increase due to stock price appreciation, it turns out there wasn't a direct correlation. SMG only increased its quarterly dividend $.03 per share, or 5.5%. Not bad, but definitely below my expectations.
- Company #3: Altria Group (MO) - Slow and steady, Altria continues to chug along. Our dividend stock analysis had nice remarks for Altria when written prior to the dividend increase. And the 5% dividend increase will only sweeten the company's insane dividend yield. At a certain point, the company's near-7% dividend yield will be too difficult for many investors to ignore (including me).
- Company #4: American Water Works (AWR) - The biggest surprise this month came from AWR, the water utility. I love AWR because it is a company that is in an industry for life, as Lanny described so well in an article in the past. Last month, we mentioned how this Dividend Aristocrat had a five-year average dividend growth rate of 6.32%. Well, the company crushed that this year by announcing a 10.9% increase in its quarterly dividend. Glad AWR beat its average; I'm just mad I'm not a shareholder.
- Company #5: Dover Corporation (DOV) - DOV has a long history of increasing its dividend; however, it has a low dividend yield and is a low dividend growth rate company. Not my type of investment. In August, DOV continued its low growth streak by increasing its quarterly dividend by only $.01 per share, or 2%. I'll have to pass for now.
Expected Dividend Increases in September 2019
Man, after summarizing August's dividend increases, I am feeling a little underwhelmed. The increases were not that large. But September is looking to change that feeling. There are some heavy-hitting dividend-paying companies this month. Let's see the companies that are expected to announce dividend increases in September.
- Company #1: Lockheed Martin (LMT) - LMT is a company that has been on a tear this last decade. It was one of the first dividend stocks that Lanny owned, and he has ridden that train to prosperity (and one day, financial freedom). The company has a double-digit five-year average dividend growth rate (10.85%) and a solid dividend yield (2.3%). I don't foresee any reason why it won't have another strong increase once again.
- Company #2: McDonald's Corporation (MCD) - One of our Top 5 Foundation dividend stocks. Man, am I looking forward to this dividend increase. McDonald's has done an excellent job re-branding and modernizing its restaurants and menus. The market is clearly impressed, and so are customers, as I always see a line wrapped around the store. This is one of my favorite dividend growth stock dividend announcements to read about, and 2019 should not be any different. Gotta love the golden arches!
- Company #3: Microsoft Corporation (MSFT) - Technology is the sector that has always been under-represented in my portfolio. Microsoft joined the $1 trillion market cap club this year - an impressive feat in itself. Now let's see if the benefits of that accomplish trickle down to dividend investors. Sure, the price has appreciated. But let's not forget about the company's dividend! Shareholders shouldn't complain too much given their 10.5% five-year average dividend growth rate.
- Company #4: Verizon Corporation (VZ) - The telecom industry is heating up. Verizon and AT&T (T) have been the two major players for year, increasing their dividends slowly along the way. But the combined T-Mobile (TMUS)/Sprint (S) company will bring a new, serious contender into the competition. Customer promotions are likely about to get wild, which doesn't bode well for a larger-than-expected dividend increase. But hopefully, VZ has something up its sleeve!
- Company #5: Philip Morris International (PM) - Now, it's PM's turn to increase its dividend. Will PM top MO's 5% dividend increase last month? Which tobacco king will reign supreme? Am I making this overly dramatic (probably)?
How many companies from this list do you own? Do you think AT&T and VZ will increase their dividends by a larger amount with increased competition? Do you think PM's dividend increase will exceed MO's? What is your favorite football team?
Editor's Note: The summary bullets for this article were chosen by Seeking Alpha editors.