Every investor wants to earn more. It is how we define "more" and how we go about earning it that defines the type of investor we are. Income investors want more income. Yield is a significant determinate of income. Instead of buying a current high-yield stock, investors in dividend growth stocks prefer to build their own. Granted, the current yield may never be classified as high-yield, but over time the yield-on-cost can reach epic heights.
This week several companies below chose to build a higher yield for their shareholders with higher cash dividends:
H. J. Heinz Company (NYSE:HNZ) manufactures and markets food products for consumers, and foodservice and institutional customers in North America, Europe, the Asia Pacific, and internationally. May 24th the company increased its quarterly dividend 7.3% to $0.515 per share. The dividend is payable to shareholders of record as of June 24, 2012 and will be paid on July 10, 2012. The yield based on the new payout is 3.9%.
The Cato Corporation (NYSE:CATO) operates as a specialty retailer of fashion apparel and accessories in the southeastern United States. May 24th the company increased its quarterly dividend 9% to $0.25 per share. The dividend is payable June 25, 2012 to shareholders of record on June 11, 2012. The yield based on the new payout is 3.5%.
Portland General Electric Company (NYSE:POR), an integrated electric utility, engages in the generation, purchase, transmission, distribution, and retail sale of electricity in the state of Oregon. May 23rd the company increased its quarterly dividend 1.9% to $0.27 per share. The dividend is payable July 16, 2012, to shareholders of record at the close of business on June 25, 2012. The yield based on the new payout is 4.4%.
Viacom Inc. (NASDAQ:VIA) operates as an entertainment content company in the United States and internationally. May 23rd the company increased its quarterly dividend 10% to $0.275 per share. The dividend is payable on July 2, 2012 to stockholders of record at the close of business on June 15, 2012. The yield based on the new payout is 2.1%.
Span-America Medical Systems, Inc. (NASDAQ:SPAN) manufactures and distributes therapeutic support surfaces and related products for the medical, consumer, and industrial markets in the United States and Canada. May 18th the company increased its quarterly dividend 13.6% to $0.125 per share. The dividend is payable June 6, 2012, to shareholders of record on May 29, 2012. The yield based on the new payout is 2.8%.
Hewlett-Packard Company (NYSE:HPQ) provide products, technologies, software, solutions, and services. May 7th the company increased its quarterly dividend 10% to $0.132 per share. The dividend is payable on July 5, 2012, to stockholders of record as of the close of business on June 13, 2012. The yield based on the new payout is 2.4%.
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: No position in the aforementioned securities. See a list of all my dividend growth holdings here.
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