3 Of The Best Businesses In The World Just Announced Dividend Increases

As someone who lives off of dividends, I must say that they are an excellent source of completely passive income. And because these dividends are increasing, all by themselves, my purchasing power can keep up with, or even exceed, inflation. Dividend growth investing sets you up to be nearly bulletproof over the long run. Today, I want to tell you about three dividend growth stocks that just increased their dividends.

The first dividend increase I have to tell you about came from Philip Morris (PM). Philip Morris just increased their dividend by 4.2%. Just a solid, solid dividend increase from a company that has been nothing short of magnificently consistent. Consistency is so important. Not just in terms of your dividends being consistent, but also in terms of your dividend increases being consistent. Because inflation sure is consistent.

Next up, let’s talk about the dividend increase that came in from Microsoft (MSFT). Microsoft just increased their dividend by 10.7%. A double-digit dividend increase from one of the best companies in the world. This is what dividend growth investing is all about. Those who focus on high yield, particularly in the junk stock arena, totally miss this. They also miss out on incredible long-term performance by chasing yield. Those who appreciate Microsoft are being amply rewarded. The global tech conglomerate has now increased its dividend for 20 consecutive years. Their 10-year DGR is an impressive 14.3%. The crazy thing is, even after 20 straight years of growing dividends, I think Microsoft is just getting started with dividend increases. Even after this double-digit dividend boost, the payout ratio is only 30.8%. And that’s before getting into the fact that they’ve got more than $100 billion in total cash on the balance sheet. This dividend is only going up from here, which is good news when you see that the yield is only 0.8%. This stock is up 35% YTD, and more than 400% over the last five years.

Last but not least, I have to tell you about the dividend increase that was recently announced by Texas Instruments (TXN). Texas Instruments just increased their dividend by 12.7%. Another high-quality dividend growth stock. Another double-digit dividend increase. It’s like déjà vu or something. In all seriousness, though, how can you not love this? All you have to do is hold shares in a world-class enterprise, and you get a near-13% “pay raise”. It’s a beautiful thing. This is the 18th consecutive year of dividend increases for the semiconductor company. This stock is up more than 40% over the year, and the valuation looks a bit stretched. Most basic valuation metrics are running ahead of their respective recent historical averages. For instance, the P/E ratio of 26.9 is notably higher than its five-year average of 24.2. So this is a stock that usually commands a premium in terms of its earnings multiple, but this current premium is heavy. If this stock corrects by 10% or so, however, it’s a high-quality tech name that should absolutely be on your radar.

Video Length: 00:07:28

Disclaimer: Please consult with a licensed investment professional before investing any of your money. Never invest in a security or idea featured on this channel unless you can afford to lose ...

How did you like this article? Let us know so we can better customize your reading experience.


Leave a comment to automatically be entered into our contest to win a free Echo Show.