Monday, August 7, 2017

7 Stocks Using Cash To Pay Higher Dividends

The Boston Consulting Group doesn’t discount the role that stock buybacks can play in boosting near-term returns for some companies. But the firm’s research indicates that stock buybacks do not change investors’ estimates for long-term earnings-per-share growth, or induce them to accord a company a higher valuation multiple. By contrast, it says, dividend growth has a far more positive long-term impact.

Below are several companies that recently used cash to increase dividends paid to their shareholders:

The Kraft Heinz Company (KHC) is a food and beverage company. The Company is engaged in the manufacturing and marketing of food and beverage products, including condiments and sauces, cheese and dairy, meals, meats, refreshment beverages, coffee and other grocery products. Recently the company increased its quarterly dividend 4.2% to $0.625 per share. The dividend is payable September 15, 2017 to stockholders of record on August 18, 2017, with an ex-dividend date of August 18, 2017. The yield based on the new payout is 2.9%.

Skyworks Solutions Inc. (SWKS) designs, develops, manufactures and markets semiconductor products, including intellectual property. Recently the company increased its quarterly dividend 14% to $0.32 per share. The dividend is payable August 29, 2017 to stockholders of record on August 8, 2017, with an ex-dividend date of August 4, 2017. The yield based on the new payout is 1.3%.

Main Street Capital Corporation (MAIN) is a principal investment firm with the principal investment objective to maximize its portfolio's total return by generating current income from the Company's debt investments and capital appreciation from its equity and equity related investments. Recently the company increased its quarterly dividend 2.7% to $0.19 per share. The dividend is payable October 16, 2017 to stockholders of record on September 21, 2017, with an ex-dividend date of September 20, 2017. The yield based on the new payout is 5.9%.

Illinois Tool Works Inc. (ITW) is a manufacturer of industrial products and equipment. Recently the company increased its quarterly dividend 20% to $0.78 per share. The dividend is payable October 10, 2017 to stockholders of record on September 29, 2017, with an ex-dividend date of September 27, 2017. The yield based on the new payout is 2.2%.

Simon Property Group, Inc. (SPG) is a self-administered and self-managed real estate investment trust (REIT) that owns, develops and manages retail real estate properties, which consist primarily of malls, Premium Outlets and The Mills. Recently the company increased its quarterly dividend 2.9% to $1.80 per share. The dividend is payable August 31, 2017 to stockholders of record on August 17, 2017, with an ex-dividend date of August 15, 2017. The yield based on the new payout is 4.5%.

Aqua America, Inc. (WTR) is engaged in providing water or wastewater services concentrated in Pennsylvania, Ohio, Texas, Illinois, North Carolina, New Jersey, Indiana and Virginia. Recently the company increased its quarterly dividend 7% to $0.2047 per share. The dividend is payable September 1, 2017 to stockholders of record on August 16, 2017, with an ex-dividend date of August 14, 2017. The yield based on the new payout is 2.4%.

Apollo Global Management, LLC (APO) is an alternative investment manager in private equity, credit and real estate that raises, invests and manages funds on behalf of pension, endowment and sovereign wealth funds, as well as other institutional and individual investors. Recently the company increased its quarterly dividend 6.1% to $0.52 per share. The dividend is payable August 31, 2017 to stockholders of record on August 22, 2017, with an ex-dividend date of August 18, 2017. The yield based on the new payout is 7.3%.

Selecting stocks with increasing dividends is critical for an income growth strategy. The above list contains stocks that recently raised their dividends; it is not a list of recommend buys. As always, due diligence should be performed before buying or selling any stock. For a list of stocks with a long string of consecutive cash dividend increases, see this list.

Full Disclosure: Long ITW in my Dividend Growth Portfolio, and MAIN in my High-Yield Portfolio. See a list of all my Dividend Growth Portfolio holdings here.

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Tags: KHC, SWKS, MAIN, ITW, SPG, WTR, APO,

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