Expected Dividend Increases in May 2017

Dividend Increases, dividend increases, dividend increases.  Man, this is the exciting announcement that all of us dividend growth investors eagerly await.  A dividend increase is one of the best benefits of a dividend growth investor and can come in all shapes and sizes.  Since we are constantly tracking the companies in our portfolio, each month, we prepare a listing of dividend increases that we are expected to receive from companies in our portfolio and several Dividend Aristocrats that we do not hold.   Now, it is time to dive in and see which companies we expect to increase their quarterly dividend in May 2017.

April 2017 dividend increases recap

Man, April was a busy month for us dividend growth investors.  For some reason, their were companies announcing dividend increases left and right.  With a lot to summarize, I won’t waste too much time here and I’ll dive right into a recap of some of the companies that announced a dividend increase in April.

Company #1 – Procter & Gamble (PG) –  PG announced an increase of $.0201/share in the company’s quarterly dividend… representing a 3% increase.  We were a little surprised that the dividend increase here was below their 3 and 5 year dividend growth rates of 3.66% and 5.01% (prior to the announcement), especially given earlier earnings releases and some of the optimism that the two of us felt about the company.   But an increase is an increase, nonetheless, and it marks the 61st consecutive annual dividend increase for PG.  A mark matched by few.

Company #2 – Johnson and Johnson (JNJ) – What always came to mind with JNJ prior to April…7%.  Typically I had always associated JNJ with an annual 7% dividend increase.  This year, JNJ increased their quarterly dividend $.04/share quarterly to $.84/share, a 5% increase.   While the decrease isn’t significantly lower than the 7% mark I typically expect from JNJ, it was a little surprising given the great run that the company has been on.   The company is closely trailing PG and has announced a dividend increase for 55 consecutive years, which is one of the main reasons that JNJ is one of our  Top 5 Foundation Stocks for a dividend portfolio.

Company #3 – PPG Industries (PPG) –  Interestingly, PPG did not announce a dividend increase this quarter.  Currently in a bidding war for an acquisition, so it does not surprise me that the company put their annual dividend increase on hold.   The company still has plenty of time left to continue their streak as a Dividend Aristocrat!

Company #4 – International Business Machine (IBM) – The two of us were watching the IBM dividend increase closely and could not wait for the company to increase their dividend, especially given the company’s recent history of average dividend growth.  Similar to PG and JNJ, IBM announced a dividend increase less than their average by announcing a $.10/share increase in their quarterly payment.   This represents a 7.1% increase and is the company’s 22nd consecutive annual dividend increase.  Man they are on the doorstep of becoming Dividend Aristocrats!

Company #5 – Costco (COST) – Wow – two amazing things happened when COST announced their dividend increase.  First, COST announced a $.05/share increase in their quarterly dividend, just a small 11% increase in their regular dividend.  Now, their quarterly dividend sits at $.50/share  Oh yeah, the second part of the announcement.  COST announced a $7.00/share SPECIAL CASH DIVIDEND for all shareholders.  Man oh man.  Congrats to all the COST shareholders out there.  Man I’m jealous!

Bonus Company #1 – W.W. Granger (GWW) – Ah Granger – Yes, this company was off of our initial list here, but quickly flew on our radar due to the work of Lanny.  And Lanny didn’t mess around once GWW popped on his radar since he initiated a position in the company last week.  But Granger increased their quarterly dividend $.06/share, or 5%.  What is nuts is that once Granger announced their dividend, I swear I heard their commercials on the radio every half hour.  Funny how that works, right?

Bonus Company #2 – Exxon Mobil (XOM) – This one was truly a surprise here.  We all know the recent history of oil companies, and it was exciting to see XOM and CVX knock their recent earnings out of the park.  Maybe the large oil companies are finally breaking out of their slumber…maybe (but time will tell).   This month, XOM announced a $.02/share increase in their quarterly dividend, a small 2.66% increase.   But this was very exciting news for all shareholders out there.

May 2017 expected dividend increases

Phew, I told you there were a lot of companies that increased their dividend in April.  Kind of crazy, but am loving the impact that my forward dividend income felt thanks to the increases announced by PG, JNJ, and IBM.   Now onto the fun part, time to look ahead and see which companies will help us out here in May 2017!

Company #1 – Clorox Co. (CLX) – With a slow and stead approach to increasing their dividend, this Dividend Aristocrat has a 3 and 5 year average dividend growth rate of 4.06% and 5.96%, respectively.  Always a fan of consumer staple dividend growth stocks, CLX is a company that I would love to one day own if the company would fall and stop trading at such a premium.

Company #2 – Lowes Corp (LOW) – A long time ago, we labelled LOW one of our Top 5 low dividend yield, high dividend growth rate stocks because you guessed it, LOW has a strong historical dividend growth rate.  LOW’s five-year dividend growth rate is a “small” 20.26%.   Looking forward to seeing what LOW has up its sleeve here in 2017; but unfortunately, we will have to wait till the very end of the month to find out.

Company #3 – PepsiCo (PEP) – Ah, one of my 5 “Always Buy” stocks has found a way onto this list.  Man I cannot wait to buy shares of this beverage and snack company one day in the future.  PEP has a strong 3 and 5 dividend growth rate of 9.93% and 7.95%; however,hopefully PEP can deliver better news than PG and JNJ did in April.

Company #4 – Apple (AAPL) – This was an increase that I was expecting towards the end of April.  April came and April went, and AAPL did not announce a dividend increase.   However, they came firing right out of the gate in the month of May.  In May, Apple announced an insane 10.5% annual dividend increase and provided an extra jolt to their share buyback program.  Bottom line, the company just returned a lot of capital to shareholders.

summary

Being a dividend growth investor is a heck of a lot of fun, isn’t it?  I cannot wait to receive a dividend increase and run home and update my portfolio tracking spreadsheet.  Sure, the majority of the increases do not result in a substantial increase in my forward dividend income individually.  But when you aggregate the impact of each individual increase, it is hard to ignore the impact that dividend increases have on your portfolio.  That’s why we spend so much time discussing increases and waiting on the edge of our seat for the next announcement.  Because remember, every single dollar counts here as we slowly work our way towards financial freedom!

How many companies from this list do you own? Did you receive any dividend increases from companies in April that were not included on this list?  What are your thoughts on the eagerly anticipated Apple dividend increase announcement?  Will in come in May 2017? What dollar impact did the increases have on your forward dividend income?

-Bert

DISCLOSURE: I DO NOT RECOMMEND ANY DECISION TO THE READER or ANY USER, PLEASE CONSULT YOUR OWN RESEARCH. THIS IS ACTUAL DATA, ANALYSIS, HOWEVER I BASE NO INVESTOR RECOMMENDATION.  THANK YOU FOR YOUR UNDERSTANDING
Facebooktwittergoogle_plusredditpinterestlinkedinmail

32 thoughts on “Expected Dividend Increases in May 2017

    • Of course MBC! Glad to compile and so some fun research here. I know you are a mutual fund person, but how do you not stare at these juicy dividend increases and not get excited haha

      Bert

    • Thanks BHL! I wish I owned all of those companies, but I only own a few of them. Right now I’m pretty darn jealous of those COST shareholders, I’ll tell you what. Maybe it will tumble before the upcoming ex-dividend date and I can steal a nice special dividend.

      Bert

  1. I actually own several of those companies and so I’m very excited. PG, JNJ, XOM, and AAPL are all on my list. Although, AAPL could use a little love right now in my portfolio. Awesome report Bert. You might have just made my day.

    • Glad I could make your day here! Always a nice treat and makes me even more excited to write these articles in the future. Glad to see you received a nice boost from some companies. I don’t own any Apple either and I’m not sure how I have managed to stay away for so long.

      Bert

  2. AAPL is my largest investment and my fifth largest dividend payer. It just became the largest dividend payer in the world. Hopefully as the years progress I can add some of these companies

  3. Great to see the apple bump after the earnings call yesterday. I’m looking forward to seeing that and the additional raises from the other companies trickle down into higher payments out of my index funds as apple is the only individual stock I own from the list.

    • Great point TITM. The dividends will definitely trickle through to the funds. At least you picked a great company to own individually, right? Hopefully others can follow suit and continue to provide nice dividend increases as well.

      Bert

  4. Love dividend increases! That is a nice list with more to come shortly, I’m sure. Congrats to anyone who has a position with any of those companies. Who saw the $7 COST special payment? That is huge! Still have a lot of year left so looking forward to seeing more increases. Thanks for sharing.

    • I had no clue that COST even announced a special dividend. I can’t imagine how that just slipped under the radar. While other months aren’t as heavy as April is, there are still a ton of great companies that should increase their dividend this month. CLX and PEP this month…two HUGE consumer staple stocks.

      Bert

  5. Nice list, very good to see how much growth there is with dividend paying companies. We own a few out this list. But for us there is another company that deserves a mention: BESI. It’s a Dutch company (not a typical dividend company) which increased their dividend from €1.20 to €1.47 (+22.5) and as a bonus for their rocking sales they are paying a special dividend worth of €0.35. Including the bonus (total dividend of €1.74) this means an increase of +45%!!

      • It’s really amazing indeed. BESI is a semiconductors company. But their not focused on growing dividend every year, so it might just be that you would get less dividend next year. It mostly depends on the profit they make. Fortunately they had some high returns the last few quarters and higher expectations than last year. The market they are in is very volatile.

  6. Great list of some fantastic companies. I bought XOM right when they were announcing the raise, talk about great timing! Apple going up also a great feeling. I own only a couple on the list, but I’m looking forward to many more of my companies increasing as the year goes on.

    • There are a lot of great companies, aren’t there Duncan?? Can’t believe you snuck in before XOM announced their awesome quarterly results. Talk about a major surprise to jump up out of nowhere.

      Bert

  7. I don’t understand the reasoning behind COST’s special dividend this time around. The previous 2 special dividends were because they were ridiculously flush with cash and so it made sense. This time though they’re paying for it, or at least the majority of it, via low cost debt. Yeah the debt is manageable because the interest rate is so low, but I don’t understand why they would take on debt to literally just pay out a special dividend. But what do I know.

    I’m looking forward to LOW as well although I’m not a shareholder yet. I missed my opportunity when it was in the low $70s a couple months back and now it’s nowhere near there. I’ll probably be able to at least create my own LOW dividend via option premium, but I won’t be getting those truly passive dividends that I love just yet.

    PEP actually announced the increase back in January?, maybe early February, and it came out to around 7% if I recall correctly. PEP is kind of weird with how they announce the intended dividend increase to take effect with the dividend payment after the last one at the previous rate. It’s odd but the raises keep coming so I can’t complain. It became official either yesterday or today when they officially declared their dividend. You’ve got to love dividend increase announcements.

    • JC,

      Thanks for the background about COST. I read the highlights, but definitely didn’t dive into it. I understand that debt is cheap at the moment, but you don’t want to over lever yourself for the sake of paying dividends. Ask KMI how well that story worked out. I’m sure(and hope) that management strongly considered the implication of taking on debt to pay the dividend.

      Did not realize that with PEP’s announcements either. Will have to remember that for the April 2018 update. I remember going through the HD/LOW debate in the past, but never settling on buying either because the two companies have just taken off in price. That’s been the hard part with a lot of the aristocrats on this list. I would love to add them to my portfolio, but some of them are just trading at such crazy premiums.

      Bert

    • Some great names to at least keep in your back pocket and monitor in the event they trade down. At least that is how I view the majority of the companies on this listing, especially the ones that are trading at insane premiums.

Leave a Reply

Your email address will not be published. Required fields are marked *