Six Dividend Stocks Rewarding Shareholders With A Raise

Each week, I go through the list of dividend increases in order to monitor performance of existing holdings, and uncover hidden dividend gems. I then narrow down the list by eliminating companies with a dividend growth streak that is less than a decade (1).

I also look at things like trends in earnings per share, dividends per share, dividend payout ratios, in order to determine the likelihood of future dividend growth and growth in intrinsic value. My basic analysis also focuses on valuation and dividend sustainability.

Andrey_Popov/Shutterstock.com

Over the past week, there were six dividend stocks with a long streak of consecutive annual dividend increases, which raised dividends to shareholders. The companies include:

Brown-Forman Corporation (NYSE:BF.B) manufactures, bottles, imports, exports, markets, and sells various alcoholic beverages worldwide. It provides spirits, wines, ready-to-drink cocktails, whiskey, vodka, tequilas, champagnes, brandy, and liqueur. Last week, the company raised its quarterly dividend by 7.40% to 18.25 cents/share. This marked the 33th consecutive annual dividend increase for this dividend champion. Over the past decade, Brown-Forman Corporation (NYSE:BF.B) has managed to raise its dividends at a rate of 9.40%/year. Currently, the stock is overvalued at 26.10 times forward earnings and yields 1.60%. Brown-Forman Corporation (NYSE:BF.B) would look more appealing on dips below $36/share. Check my analysis of Brown-Forman for more information about the company.

Union Pacific Corporation (NYSE:UNP), through its subsidiary, Union Pacific Railroad Company, operates railroads in the United States. Last week, the company raised its quarterly dividend by 10% to 60.50 cents/share. Union Pacific Corporation (NYSE:UNP) was overdue for a dividend increase, as it had kept the quarterly dividend unchanged for the past 7 quarters. Union Pacific has managed to boost annual dividends to shareholders for a decade. Over the past decade, Union Pacific Corporation (NYSE:UNP) has managed to raise its dividends at a rate of 22%/year. This was possible because of the expansion in the dividend payout ratio, along with the strong earnings performance over the past decade. Currently, the stock is overvalued at 20.20 times forward earnings and yields 2.40%. The stock would look better on dips below $97/share. It would look even better at a P/E of 15 – 16. Check my analysis of Union Pacific for more information.

Nike Inc (NYSE:NKE), together with its subsidiaries, designs, develops, markets, and sells athletic footwear, apparel, equipment, and accessories worldwide. Last week, the company raised its quarterly dividend by 12.50% to 18 cents/share. This marked the 15th consecutive annual dividend increase for this dividend achiever. Over the past decade, Nike Inc (NYSE:NKE) has managed to raise its dividends at a rate of 15.50%/year. Currently, the stock at 21.60 times forward earnings and yields 1.40%. I would be interested in initiating a position in Nike Inc (NYSE:NKE) on dips below $47 – $48/share.