- This article series covers dividend changes on a weekly basis.
- A summary table presents relevant data and key statistics of dividend increases.
- We highlight one of the stocks that announced a dividend increase, providing a quality assessment and performance, earnings, and valuation charts.
We monitor dividend changes of stocks in Dividend Radar, a weekly automatically generated spreadsheet listing stocks with dividend streaks of five years or more. The Dividend Radar spreadsheet separates stocks into categories three categories: Champions (with dividend increase streaks of 25+ years), Contenders (10-24 years), and Challengers (5-9 years).
This week, five companies in Dividend Radar decided to increase their dividends, including one of my DivGro holdings. Note there were no dividend cuts or suspensions announced for Dividend Radar stocks during this period.
The table below presents a summary of the dividend increases. The table is sorted into sections for Champions, Contenders, and Challengers, followed by the percentage increase (%Incr). Dividends are annualized and in US$, unless otherwise indicated. Yield is the new dividend yield for a recent price, and Yrs are years of consecutive dividend increases.
|Summary of Dividend Increases: November 20-26, 2021|
Source: Created by the authors from data in Dividend Radar.
The following dividend increase data are sorted alphabetically by ticker.
Company descriptions are the author's summary of company descriptions sourced from Finviz.
Farmers National Banc Corp. (FMNB)
FMNB, a financial holding company, operates in the banking, trust, retirement consulting, insurance, and financial management industries. The company offers various deposit and loan services and trust services, and insurance products and services in the States of Ohio and Pennsylvania. FMNB was founded in 1887 and is headquartered in Canfield, Ohio.
- On Nov 24, FMNB declared a quarterly dividend of 14¢ per share.
- This is an increase of 27.27% from the prior dividend of 11¢.
- Payable Dec 31, to shareholders of record on Dec 10; ex-div: Dec 9.
Hingham Institution for Savings (HIFS)
HIFS provides various financial products and services to individuals and small businesses in the State of Massachusetts. The company offers multiple deposit and loan products and ATM, telephone, and Internet banking services. HIFS was founded in 1834 and is headquartered in Hingham, Massachusetts.
- On Nov 23, HIFS declared a quarterly dividend of 55¢ per share.
- This is an increase of 3.77% from the prior dividend of 53¢.
- Payable Jan 12, to shareholders of record on Jan 3; ex-div: Dec 30.
Hormel Foods Corporation (HRL)
HRL is a multinational manufacturer and marketer of consumer-branded food and meat products. The company sells its products through sales personnel, as well as through independent brokers and distributors. Customers include retailers, hospitals, nursing homes, and marketers of nutritional products. HRL was founded in 1891 and is based in Austin, Minnesota.
- On Nov 22, HRL declared a quarterly dividend of 26¢ per share.
- This is an increase of 8.33% from the prior dividend of 24¢.
- Payable Feb 15, to shareholders of record on Jan 18; ex-div: Jan 14.
South Jersey Industries, Inc. (SJI)
Founded in 1910, SJI is an energy services holding company based in Folsom, New Jersey. It operates through two primary subsidiaries, South Jersey Gas and South Jersey Energy Solutions, delivering clean and efficient natural gas and energy efficiency to residential, commercial, and industrial customers in southern New Jersey.
- On Nov 22, SJI declared a quarterly dividend of 31¢ per share.
- This is an increase of 2.48% from the prior dividend of 30.25¢.
- Payable Dec 29, to shareholders of record on Dec 10; ex-div: Dec 9.
The York Water Company (YORW)
YORW impounds, purifies, and distributes drinking water in Pennsylvania. It also owns and operates three wastewater collection systems and two wastewater treatment systems, and two reservoirs. In addition, the company owns a 15-mile pipeline and seven wells. YORW was founded in 1816 and is headquartered in York, Pennsylvania.
- On Nov 23, YORW declared a quarterly dividend of 19.49¢ per share.
- This is an increase of 4.00% from the prior dividend of 18.74¢.
- Payable Jan 14, to shareholders of record on Dec 31; ex-div: Dec 29.
Please note that we're not recommending any of these stocks. Readers should do their own research on these companies before buying shares.
Dividend Cuts and Suspensions
Following requests from readers, we've added this section to our weekly article series. Please note that we're only covering dividend cuts and suspensions announced by companies in Dividend Radar's spreadsheet.
There were no dividend cuts or suspensions announced for stocks in Dividend Radar during this period.
An Interesting Candidate
In this section, we highlight one of the stocks that announced a dividend increase. We provide a quality assessment and present performance, earnings, and valuation charts.
Our objective is to identify high-quality dividend growth [DG] stocks trading at reasonable valuations. That's an arduous task, though, as high-quality DG stocks often trade at premium valuations. If we can't find a worthy candidate, we'll suggest a stock to add to your watchlist and a suitable target price.
To start, we use DVK Quality Snapshots to do a quick quality assessment, screening our list of DG stocks based on quality scores in the range 19-25. Only one of this week's stocks passes the quality screen:
Source: Created by the authors from data in Dividend Radar
HRL yields 2.44% at $42.70 per share and has a robust 5-year DGR of 11.6%!
HRL is rated Fine (quality score: 19-22):
Over the past ten years, HRL has underperformed the SPDR S&P 500 ETF (SPY), an ETF designed to track the 500 companies in the S&P 500 index:
Over this time frame, HRL delivered total returns of 234% versus SPY's 346%, a margin of 0.68-to-1.
If we extend the comparison period to the past twenty years, HRL easily outperformed SPY, with total returns of 857% versus SPY's 491% (a margin of 1.75-to-1)!
HRL's dividend growth is impressive, with annual increases that averaged about 16% over the past ten years:
HRL's dividend growth rate is decelerating, as can be seen by dividing the 5-year dividend growth rate by the 10-year counterpart: 13.21% ÷ 16.04 = 0.82. A factor below 1.00 indicates the dividend growth rate is decelerating. Nevertheless, HRL has maintained double-digit percentage increases every year for a decade, a truly remarkable feat!
Overall, HRL's EPS is growing nicely but not as steadily as the company's dividends, with down years in FY 2017, FY 2019, and FY 2020. Fortunately, estimates for FY 2021 through FY 2023 look pretty promising:
Source: Simply Safe Dividends
This means HRL has some room to continue its generous dividend increases, at least for the foreseeable future.
Next, let's consider HRL's valuation. We could estimate fair value by dividing the stock's annualized dividend ($1.04) by its 5-year average yield (2.00%). That results in a fair value [FV] estimate of $52. Given HRL's current price of $42.70, the stock is trading at a discount relative to its past dividend yield history.
For reference, CFRA's FV is $31, Morningstar's FV is $36, Finbox.com's FV is $47, and Simply Wall St's FV is $57. The average of these fair value estimates is $43, indicating that HRL may be fairly valued.
My own FV estimate of HRL is $48, so I believe the stock is trading at a discounted valuation of about 11%.
Here are the most recent Seeking Alpha articles covering HRL:
- Neutral: Ignore The Noise And Follow Hormel Foods, by Khen Elazar
- Bullish: Hormel Foods: Protect Yourself From Inflation And Ride A New Wave, by Danil Sereda
- Bullish: Hormel: Buy The Dip On This Dividend Aristocrat, by Gen Alpha
HRL is an Investment Grade DG stock rated Fine. For stocks rated Fine, I require a discounted valuation. Therefore, my Buy Below price for HRL is $48. For conservative investors, look to buy below $43 per share.
Please note that we're not recommending HRL or any of the stocks listed in this article. Readers should do their own research on these companies before buying shares.
Thanks for reading, and happy investing!
This article was written by
Analyst’s Disclosure: I/we have a beneficial long position in the shares of HRL either through stock ownership, options, or other derivatives. 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.
Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.