Seeking Alpha

Dividend Increases: October 7-11, 2019

|
Includes: AEE, AOS, EV, POL, TGE, THO, WEN
by: FerdiS
FerdiS
Dividend growth investing, portfolio strategy, long-term horizon, value
Summary

This article series provides a weekly summary of dividend increase announcements.

I like monitoring dividend increases because I consider stocks with regular dividend increases to be candidates for further analysis.

As a bonus, I include ex-dividend dates for the next two weeks.

I monitor dividend increases for stocks on my watch list of dividend growth stocks to identify candidates for further analysis. Companies that regularly raise dividends show confidence in the potential growth of future earnings.

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 past week, 7 companies that decided to increase their dividends passed these screens.

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: October 7-11, 2019

Previous Post: Dividend Increases: September 30-October 4, 2019

Wendy's (WEN)

Founded in 1969 and headquartered in Dublin, Ohio, WEN is the world's third-largest quick-service hamburger company. The company operates, develops and franchises quick-service restaurants in the United States and internationally. WEN’s restaurant system included franchise and company-operated restaurants in the United States and about 30 countries and U.S. territories.

Recently, the board of directors of WEN declared a quarterly dividend of 12¢ per share. The new dividend represents an increase of 20.00%. WEN will trade ex-dividend on November 29. The dividend is payable on December 16, to shareholders of record on December 2.

A.O. Smith (AOS)

AOS manufactures and markets water heaters, boilers, and other products for residential and commercial end markets in the United States, China, Canada, Europe, and India. The company provides electric, natural gas, gas tankless, and liquid propane water heaters, as well as solar tank units for use in residences and businesses. AOS is headquartered in Milwaukee, Wisconsin.

The company declared a quarterly dividend of 24¢ per share, an increase of 9.09% over the prior quarterly dividend. The stock will trade ex-dividend on October 30, and shareholders can expect to receive the new dividend on November 15.

Eaton Vance (EV)

EV, through its subsidiaries, engages in the creation, marketing, and management of investment funds in the United States. The company provides investment management and advisory services to high-net-worth individuals and institutions. It also advises investment companies. EV was founded in 1944 and is headquartered in Boston, Massachusetts.

On October 10, the company declared a dividend of 37.5¢ per share. The new dividend represents a 7.14% increase. All shareholders of record on October 31 can expect the dividend to be paid on November 15.

Ameren (AEE)

AEE operates as a public utility holding company in the United States. The company engages in rate-regulated electric generation, transmission, and distribution activities; and rate-regulated natural gas distribution and transmission businesses. AEE was founded in 1997 and is headquartered in St. Louis, Missouri.

The company announced an increase of its quarterly dividend of 4.21% to 49.5¢ per share. The dividend is payable on December 31 to shareholders of record on December 11.

PolyOne (POL)

POL provides specialized polymer materials, services, and solutions in the United States, Canada, Mexico, Europe, South America, and Asia. The company operates in four segments: Color, Additives and Inks; Specialty Engineered Materials; Performance Products and Solutions; and PolyOne Distribution. POL was founded in 1927 and is headquartered in Avon Lake, Ohio.

On October 10, the board of directors approved an increase to the regular quarterly dividend from 19.50¢ per share to 20.25¢ per share, an increase of 3.85%. The dividend is payable January 9, with an ex-dividend date of December 12.

Thor Industries (THO)

THO designs, manufactures, and sells recreational vehicles, and related parts and accessories, primarily in the United States and Canada. The company operates in two segments: Towable Recreational Vehicles and Motorized Recreational Vehicles. It markets its recreational vehicles through independent dealers. THO was founded in 1980 and is based in Elkhart, Indiana.

Recently, THO increased its quarterly dividend from 39¢ per share to 40¢ per share, an increase of 2.56%. The dividend is payable on November 8 to shareholders of record on October 25. THO will trade ex-dividend on October 24.

Tallgrass Energy LP (TGE)

TGE, through its subsidiaries, provides crude oil transportation services to customers in Wyoming, Colorado, Kansas, and the surrounding regions of the United States. The company operates through three segments: Natural Gas Transportation; Crude Oil Transportation; and Gathering, Processing & Terminalling. TGE was founded in 2012 and is based in Leawood, Kansas.

On October 10, the company declared a dividend of 55¢ per share. The new dividend represents a 1.85% increase. All shareholders of record on October 31 will receive the new dividend on November 14.

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, WEN, AOS, and EV.

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).

WEN's price line (black) is above the primary valuation line (orange) and above the stock's normal P/E ratio (blue). The stock is trading at a premium to fair value. An investment in WEN in January 2010 would have returned 17.5% on an annualized basis (with dividends included).

AOS's price line is below the stock's normal P/E ratio and above the primary valuation line. The stock is trading at about fair value. An investment in AOS in January 2010 would have returned 22.2% on an annualized basis (with dividends included).

EV's price line is below the primary valuation line and below the stock's normal P/E ratio. The stock is trading at a discount to fair value. An investment in EV in November 2009 would have returned 6.5% 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.

Summary of Upcoming Ex-Dividend Dates: October 15-28, 2019

Company

Ticker

Yield

Recent

Price

Yrs

5-Yr

DGR

Next

Div.

Ex-Div

Date

Pay- able

Date

Accenture

ACN

0.86%

$185.38

15

9.90%

$1.60

10/16

11/15

Apogee Enterprises

APOG

1.92%

$36.52

8

11.80%

$0.70

10/18

11/05

Saul Centers

BFS

3.95%

$53.66

6

7.60%

$2.12

10/16

10/31

Cracker Barrel Old Country Store

CBRL

3.35%

$155.39

17

14.40%

$5.20

10/17

11/05

Colgate-Palmolive

CL

2.47%

$69.51

56

4.50%

$1.72

10/22

11/15

Fastenal

FAST

2.46%

$35.76

20

14.00%

$0.88

10/24

11/22

Foot Locker

FL

3.53%

$43.03

9

11.50%

$1.52

10/17

11/01

H.B. Fuller

FUL

1.35%

$47.34

50

9.80%

$0.64

10/16

10/31

GEO

GEO

12.28%

$15.63

8

6.60%

$1.92

10/24

11/01

Graco

GGG

1.42%

$45.15

22

9.60%

$0.64

10/18

11/06

Hormel Foods

HRL

2.04%

$41.18

53

17.10%

$0.84

10/18

11/15

IDEX

IEX

1.27%

$157.62

10

13.30%

$2.00

10/15

10/31

Quaker Chemical

KWR

0.97%

$159.46

12

7.90%

$1.54

10/16

10/31

Lowe's

LOW

1.98%

$111.04

57

21.20%

$2.20

10/22

11/06

Main Street Capital

MAIN

5.86%

$41.97

9

4.30%

$2.46

10/17

11/15

McGrath RentCorp

MGRC

2.27%

$65.98

27

6.00%

$1.50

10/16

10/31

Oxford Industries

OXM

2.12%

$69.77

9

13.30%

$1.48

10/17

11/01

PNC Financial Services

PNC

3.28%

$140.41

9

14.60%

$4.60

10/16

11/05

Pentair

PNR

1.93%

$37.22

43

1.80%

$0.72

10/17

11/01

Thor Industries

THO

2.98%

$53.76

9

14.30%

$1.60

10/24

11/08

Williams-Sonoma

WSM

2.83%

$67.95

14

7.90%

$1.92

10/24

11/29

Thanks for reading and 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.