After taking a month off, it is time to for the next installment of our monthly article summarizing every dividend growth investor’s favorite topic…DIVIDEND INCREASES! For those of you that are new followers, each month we try to summarize as many companies that are expected to announce a dividend increase in the coming month as we can. Why? Because it gives us something to look forward to and there is a chance it may impact someone’s investment decision! This is going to be an exciting month because there are some big names in the investing community that are set to announce an increases. Now, it is time to roll up our sleeves and see which companies are expected to announce a dividend increase in April 2018.
Actual Dividend Increases – February and March
Typically, in this section of the post, I will summarize the results of all of the dividend increases that I summarized in the previous month. However, since I did not have a March installment of the monthly series, I am going to quickly summarize a few of the major dividend increases that were announced in February and March.
- Realty Income (O) – After my buying spree of Realty Income in January and February, I was very excited to see that Realty Income increased their monthly dividend once again. Sure, the dividend only increase from $.2190/share to $.2195/share and the impact on my forward income is minimal since I only own 90.8 shares. But I will never complain about a dividend increase and I’m glad to see Realty Income continue their streak of slowly, but surely, increasing their dividend.
- Archer-Daniels Midland (ADM) – I noted in my February article that ADM had a streak of increasing their quarterly dividend $.02/share annually. Well, that streak was snapped when ADM only announced a $.015/share increase in their quarterly dividend. This was only a 4.7% increase, which was less than I was expecting.
- TJX Companies (TJX) – I strongly considered buying TJX towards the end of 2017 and I am now kicking myself for not making an investment decision earlier. In February, TJX announced an INSANE 25% increase in their quarterly dividend and will repurchase $2.5b-$3b over the next year. That is a lot of capital being returned to shareholders!
- Pepsi (PEP) – Pepsi’s dividend increase of 15% was great and I was so excited about the increase and corresponding price pullback that the company found its way on my March Watch List. I have not purchased shares in PEP yet; however, if the price continues to fall, it will be hard to continue to ignore the company.
- T.Rowe Price (TROW) – TROW is one of my favorite positions to own. The company has no debt and is a Dividend Aristocrat, what’s not to like. On top of it, the company announced a 22.8% increase to their quarterly dividend February. As a shareholder, I nearly did back flips when I read the exciting news.
- Coca-Cola (KO) – Unlike their arch-rival, KO was not able to deliver as a strong of a dividend increase as PEP. KO only increased their quarterly dividend $.02/share, or 5.4%. However, I must say, I’m not at all surprised by this based on the company’s recent history and their payout ratio.
- Walmart (WMT) – Lastly, WMT also increased their quarterly dividend by only $.01/share per quarter. However, this was only a 4% increase since their quarterly dividend is higher than KO’s. Consistent with the company’s recent quarterly dividend increases.
Expected Dividend Increases in April 2018
And now, on to the fun part. There have been quite a few dividend increases announced so far in 2018 as evidenced by the list above and the results from January. It definitely has been a fun time to be a dividend growth investor. I’ve been excited researching and getting ready to write about the following list of companies. I know for a fact that Lanny and I will be on the edges of our seats waiting for the following companies to announce their dividend increases in April.
- Procter and Gamble (PG) – PG is one of our Top 5 foundation stocks for a reason. Finally, after a few years, the price fell enough that it finally made its way back on to Lanny’s March Dividend Stock Watch List. And trust me, I will be watching the company closely over the next few weeks as well. This dividend increase is a wild card in my opinion because of some of the larger than anticipated dividend increases posted by some companies post-Tax Reform. Will PG surprise us with a double-digit dividend increase? Or will the company continue to only increase their dividend by a low to mid single digit percentage? Regardless of the outcome, I cannot wait to read these results!
- Johnson & Johnson (JNJ) – Another heavy-weight, foundation dividend stock has found its way on to our listing here. In fact, this was one of the three companies that Lanny recently analyzed in his “Battle of the Consumer” stock articles a few days ago to see which competitor would come out on top. JNJ is one of my favorite companies in my portfolio. Over the last five years, the company has an average annual dividend increase of 6.61%. I would be ecstatic if we received a double-digit dividend increase this month. Much like PG, I will be waiting on the edge of my seat for this announcement.
- International Business Machines (IBM) – This is the third dividend increase that I am expecting to receive in the coming month. IBM’s dividend growth has slowed over the last few years, but here is what is crazy. The company still has a five-year average dividend growth rate of 12% despite announcing only a 7.1% dividend increase last year. Would it be too ambitious to expect a double-digit percent growth rate again in April?
Are you as excited for PG, JNJ, and IBM to announced their dividend increases as much as we are? What companies are you expecting to receive a dividend increase from in the coming month? Did you receive a nice dividend increase over the last two months that I did not summarize in the article?
Bert