9 Dividend Increases Expected In April 2021
Summary
- Each month, we discuss the dividend increases that are expected in the coming month.
- April is about to be insane, as 9 dividend stocks will increase your cash flow as a shareholder.
- There are some epic companies set to announce.
We have another exciting article about our favorite topic… dividend increases. Each month, we discuss the dividend increases that are expected in the coming month. April is about to be insane, as 9 dividend stocks will increase your cash flow as a shareholder. There are some epic companies set to announce. So buckle up. Get Ready. It is time to discuss the expected dividend increases in April 2021.
Why Dividend Increases Matter
Dividends are the foundation of our goal to reach financial freedom. We continuously invest in dividend growth stocks to grow our passive income. If you haven't figured it out by now, we eat, sleep, and breathe dividends!
If the goal is to produce a passive income stream that will one day cover our expenses, making sure that income stream grows is critical. Without growth, your dividend income stream will lose purchasing power to inflation. Inflation is typically between 2%-3% annually; therefore, if you cannot achieve average dividend growth of at least that percentage, your income stream will be able to cover less, and less, over time.
That is why dividend growth is a major deciding factor in all of our stock purchase decisions. It is the 3rd metric of our Dividend Stock Screener for a reason. For each stock, we review a company's history of increasing dividends (consecutive annual dividend increases) and a company's five-year average dividend growth rate!
We cover dividend news extensively on our YouTube Channel. Each week, we discuss the major dividend increases from the week before. Heck, each month, we even bring this article to life and cover the major expected dividend increases of the coming month.
What A Difference A Year Makes
I want to take a step back for a second. Let's talk about how different things are in April 2021 than they were compared to April 2020, from a dividend investor's standpoint.
Last year, at this time, it was pure chaos. Economic relief was being discussed and finalized and the stock market was recovering from the sudden falls that left us investors shocked and stunned.
Dividend cuts and dividend suspensions were the norm, especially in the hardest hit sectors from the economic shutdown such as retail. For a few months, dividend cuts in our portfolio outpaced dividend increases. Of course, this was nothing compared to what was happening in the rest of the world. But as a dividend investor, it wasn't a lot of fun to watch happen.
Now, 12 months later, dividend increases are roaring back. Trillions of dollars have been pumped into the economy via economic stimulus. Meanwhile, companies have been increasing their dividend at record pace. We truly look forward to reading the news every day and covering all the companies in our portfolio.
All in all, this is a fun time to be a dividend investor once again!
Expected Dividend Increases in April 2021
Now, you may have noticed a slightly different format compared to last month's article. Typically, before jumping ahead to the expected dividend increases, we review the companies featured in the previous month's article. Well, unfortunately, I never released a March edition of this article. Therefore, I cannot discuss last month's results.
Luckily, we have a ton of dividend increases to cover for April. So now, let's jump right in. Here are the 9 expected dividend increases in April 2021.
Company #1: Procter & Gamble (PG)
We are kicking off this list in true style! The first featured company is one of our Top 5 Foundation Dividend Stocks and has a healthy allocation in our portfolios. The Consumer Staple Giant is a Dividend King that has increased its dividend for 67 consecutive years. This is by far one of the longest dividend increase streaks out there. What was most telling to me is that Procter & Gamble increased its dividend in the heat of the pandemic in April 2020. If PG could increase its dividend last year, then there should not be any issue increasing its dividend once again in 2021!
Last year's dividend increase - 6.0%
Five-year average DGR - 3.6%
Expected timing of Dividend Increase Announcement - Middle of the month
Company #2: Johnson & Johnson (JNJ)
Company #2 on this listing is another one of the GOATs of the dividend investing community. In fact, we love this company so much, that my wife and I have decided to purchase at least 1 share of Johnson & Johnson weekly. Just like PG, Johnson & Johnson also increased its dividend in the heart of the pandemic. The company is also a dividend king. I guess we have two peas in a pod, right? Overall, I am expecting that Johnson & Johnson announces a 6% dividend increase. This would be in line with last year's increase and the company's five-year average dividend growth rate.
Last year's dividend increase - 6.31%
Five-year average DGR - 6.14%
Expected timing of Dividend Increase Announcement - Middle of the month
Company #3: International Business Machines (IBM)
One of the newest members of the Dividend Aristocrat family. Last year, IBM announced its 25th consecutive annual dividend increase. Now, it wasn't the largest of dividend increases. In fact, it was a terrible dividend increase. Less than 1%. Woof. However, that still hasn't stopped me from investing in the stock last year and performing a dividend stock analysis to see if IBM is considered a dividend stock to buy! This year, I'm expecting an increase in line with their five-year average dividend growth rate.
Last year's dividend increase - .6%
Five-year average DGR - 4.66%
Expected timing of Dividend Increase Announcement - End of the month
Company #4: Southern Company (SO)
The utility company is one of the darlings of the dividend investing community. There was a period of time where it felt like every dividend investor was buying stock in this company. You have to love Southern Company's consistency. The company's five-year average dividend growth is just above 3%. Their dividend increase in 2020 was about the same. Therefore, I am not expecting anything to change in 2021.
Last year's dividend increase - 3.22%
Five-year average DGR - 3.36%
Expected timing of Dividend Increase Announcement - Middle of the month
Company #5: W.W. Grainger (GWW)
Who doesn't love this massive company that has been on a tear over the last year? Grainger typically announces in April. Last year, they did not announce in April due to the pandemic. Instead, they announced a dividend increase in July. You cannot blame the company though, right? After all, last year at this time, the company's customer base was getting hammered. They needed time to assess the company's cash flow before committing to an increased payout from shareholders. My projection is that the company returns to their scheduled dividend increase announcement in April.
Last year's dividend increase - 5.88%
Five-year average DGR - 5.93%
Expected timing of Dividend Increase Announcement - End of the month
Company #6: Apple Inc. (AAPL)
Now this is where things will get exciting. Apple is one of the most popular, highly covered stocks out there. Every major announcement and product release by the company is covered heavily by investors, analysts, customers, and tech fans alike. Dividends are not usually the first thing that comes to mind when we discuss Apple. However, their dividend news is still important due to the number of shareholders impacted by the announcement. Let's see if Tim Cook has something up his sleeve this month.
Last year's dividend increase - 6.2%
Five-year average DGR - 9.6%
Expected timing of Dividend Increase Announcement - End of the month
Company #7: Kinder Morgan (KMI)
Kinder Morgan has made quite the comeback over the last 5 years. The company slashed its dividend at the end of 2015 to rebuild its balance sheet and de-lever. The company once again began increasing its dividend in 2020 aggressively. However, in 2020, dividend growth slowed to only 5.48% due to the pandemic and the sudden drop in the price of oil. To me, this one will be interesting. We have had a year of low oil prices. Giants like Exxon (XOM) and Chevron (CVX) still have not announced a dividend increase. What will Kinder Morgan do? That's what we gotta find out!
No dividend growth until 2018, skews 5-year average dividend growth rate.
Last year's dividend increase - 5.48%
Five-year average DGR - 4.23%
Expected timing of Dividend Increase Announcement - Middle of the month
Company #8: Travelers Insurance (TRV)
The insurance giant has been on a tear in 2021. Like all companies in the sector, revenue is up, claims are down, and their investment portfolios are on fire. This should be an interesting dividend increase, as I could easily see the company blowing their five-year average dividend growth rate out of the park. That is part of the reason we covered Travelers on our YouTube channel and performed a detailed dividend stock analysis over the company.
Last year's dividend increase - 3.65%
Five-year average DGR - 6.88%
Expected timing of Dividend Increase Announcement - End of the month
Company #9: Costco (COST)
Last, but definitely not least, America's favorite superstore. The company is a low dividend yielding company; however, they love to surprise investors with massive special dividends. In fact, Costco announced a $10 per share special dividend in November 2020! Taking the special dividend out of the picture, the company still has a double-digit dividend growth rate. That has to have investors running to take some samples of the company's dividend… am I right? I expect another double-digit dividend increase once again!
Last year's dividend increase - 7.69%
Five-year average DGR - 12.9%
Expected timing of Dividend Increase Announcement - Middle of the month
Summary
I told you this is going to be an exciting month for dividend growth investors. Let us know if you are as pumped up for April as we are! I'll tell you what, I am excited to see my income from PG, JNJ and IBM increase without lifting a finger. After all, that is what being a dividend investor is all about!
How many of the stocks do you own? What dividend increases will you receive in April? Are there any companies that were not featured in this article?
-Bert
Editor's Note: The summary bullets for this article were chosen by Seeking Alpha editors.
This article was written by
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Comments (9)
-AAPL raised their dividend one year ago, from $0.1925 to $0.205 on the dividend paid on May 14, 2020.
-IBM raised by $0.14 last year at this time.
-JNJ raised by $0.06 on the dividend paid on Mar 10, 2020.
-PG raised by $.05 (approx) on the dividend paid on May 15, 2020
Been a good run on IBM. My end of year price target is 138 and we are awfully close.
