7 Dividend Growth Stocks Rewarding Shareholders With A Raise

I review the list of dividend increases every week, as part of my monitoring process. This exercise helps me to check up on existing holdings and to identify companies for my watch list.

Last week, there were seven dividend growth stocks that raised dividends to shareholders. Each one of those companies has at least a ten-year track record of annual dividend increases. Since dividends are paid out of earnings, these dividend achievers couldn’t have compiled such a record without having enjoyed consistent success in their core business, whatever it is. So you’re looking at a group of profitable enterprises with staying power.

I review the increase relative to the dividend record, along with valuation and track record. The companies included:

Realty Income (O), The Monthly Dividend Company is an S&P 500 company dedicated to providing stockholders with dependable monthly income. The company is structured as a REIT, and its monthly dividends are supported by the cash flow from over 5,600 real estate properties owned under long-term lease agreements with regional and national commercial tenants.

The REIT raised its monthly dividend to 22.55 cents/share, which represents a 3% increase over the distributions paid during the same time last year. This is the 100th dividend increase since Realty Income's listing on the NYSE in 1994. 

During the past decade, Realty Income has managed to boost dividends at an annual rate of 4.40%/year.

Between 2008 and 2017, FFO/share grew from $1.83 to $2.82. Realty Income is expecting to generate FFO/share in the $3.11 - $3.14 range in 2018.

I like Realty Income, but so do a lot of other REIT investors. As a result, it is offering a 4.20% yield and is selling at 20.80 times forward FFO. The REIT is managed well, but I would require at least a 5% entry yield to purchase it. At current rates, this translates into a buy price below $54/share. Check my analysis of Realty Income for more information about the REIT.

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Disclaimer: I am not a licensed investment adviser, and I am not providing you with individual investment advice on this site. Please consult with an investment professional before you invest ...

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