STZ - 3 Upcoming Dividend Increases

2023-04-27 15:20:28 ET

Summary

• All these stocks have at least five fiscal years of dividend growth history and come from the U.S. Dividend Champions List.
• They have an average increase of 9.1% and a median increase of 11.3%.
• There are three increases for next week, the same as two weeks ago.
• For your consideration, I've tracked 178 dividend increases in 2023, 160 in Q2, and 18 so far in Q2.

Investors often find that companies with a history of increasing dividends tend to perform better than those that don't. When a company's management announces a dividend increase, it typically indicates strong business performance and a dedication to rewarding shareholders. As your assistant, I keep a watchful eye on companies that have a proven track record of growing their dividends, providing you with the latest updates on any upcoming increases. The following lists provide valuable insights into stocks that are expected to raise their dividends in the coming week, which is especially relevant in today's inflationary climate.

This list is a trimmed-down version, only covering dividend increases. A full upcoming dividend calendar is always available here .

How I Created The Lists

I created the information below by combining the "U.S. Dividend Champions" spreadsheet hosted here with upcoming dividend information from NASDAQ. This meshes metrics about companies with dividend growth history with upcoming dividend payments. These companies all have a minimum five-year dividend growth history.

Companies are required to have higher total dividends paid out each year. Therefore, a company may not raise its dividend each calendar year, but the total annual dividend can still increase.

What Is The Ex-Dividend Date?

The ex-dividend date marks the eligibility cut-off point for the upcoming dividend or distribution. To qualify, you must have purchased shares by the close of the preceding business day. For example, if the ex-dividend date falls on a Tuesday, you must have bought (or already owned) the shares by the market close on Monday. Note that if the ex-dividend date is on a Monday (or a Tuesday if Monday is a holiday), you must have acquired the shares by the prior Friday.

Dividend Streak Categories

Here are the definitions of the streak categories, as I'll use them throughout the piece.

• King: 50+ years
• Champion/Aristocrat: 25+ years
• Contender: 10-24 years
• Challenger: 5+ years

The Dividend Increasers List

Data has been sorted by the ex-dividend day (ascending) and then by the streak (descending):

Field Definitions

Streak : Years of dividend growth history are sourced from the U.S. Dividend Champions spreadsheet.

Forward Yield : The new payout rate is divided by the current share price.

Ex-Dividend Date : This is the date you need to own the stock.

Increase Percent : The percent increase.

Streak Category : This is the overall dividend history classification of the company.

Show Me The Money

Here's a table mapping the new rates versus the old rates. It also reiterates the percentage increase. This table is sorted similarly to the first table (ex-dividend day ascending, dividend streak descending).

Additional Metrics

Some different metrics related to these companies include yearly pricing action and the P/E ratio. The table is sorted the same way as the table above. A value investor may find stock ideas with those companies near their 52-week lows, as they could provide more margin of safety and inflated yield.

Tickers By Yield And Growth Rates

I have arranged the table in descending order for investors to prioritize the current yield. As a bonus, the table also features some historical dividend growth rates. Moreover, I have incorporated the "Chowder Rule," which is the sum of the current yield and the five-year dividend growth rate.

Historical Returns

As an investor, I prioritize finding stocks that offer consistent dividend growth and have a track record of outperforming the market. To assess their performance, I use the Schwab U.S. Dividend Equity ETF ( SCHD ) as a benchmark. This ETF has a strong history of exceptional performance, a higher yield compared to the S&P 500, and a proven record of growing dividends. In my opinion, if you can't surpass the benchmark, it's wise to consider investing in it.

Here's the total return chart of SCHD versus everyone on the list. A lack of available data slightly constrains the timeline. Even with the shorter horizon, COST was the big winner, with a 234% total return since 2017. SCHD, however, beat both HESM and STZ.

Please do your due diligence before investing, and thanks for reading.

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