I love to kick off the new trading week by taking a quick peek at companies that have just hiked their dividends -- and not just because of the money involved. A company willing to open its wallet wider probably has improving fundamentals to back up that generosity.
Readers of the Motley Fool's Income Investor newsletter can certainly appreciate that kind of thinking. Let's take a closer look at four of the companies that inched their payouts higher over the past week.
We'll start with defense contractor General Dynamics (NYSE: GD ) , which is boosting its quarterly dividend by 9% to $0.35 a share. The stock still hit a fresh low on Friday, likely because of concerns over future defense spending. Opportunistic investors may be tempted by the potent combination of growing distributions and shrinking share prices. After all, General Dynamics is now yielding a healthy 3.8%.
Wal-Mart (NYSE: WMT ) is also giving its shareholders a little more shopping money. The world's largest retailer will jack up its payout by 15%, giving investors a new total of $0.2725 a share every three months. The move shouldn't surprise Mr. Market. Wal-Mart is thriving as shoppers trade down to its discount department stores and warehouse clubs. Wal-Mart has also boosted its distributions every year since 1974.
National Research Corp. (Nasdaq: NRCI ) is another hiker. The health-care performance specialist is beefing up its disbursements by 14%, to $0.16 a share.
Finally, Piedmont Natural Gas (NYSE: PNY ) is further fueling its payouts. The utility company's quarterly rate will grow by 4% to $0.27 a share. Piedmont has now increased its yield in 31 consecutive years.
Some of these moves may not sound like much, but consider the companies going the other way last week:
- Wells Fargo (NYSE: WFC ) became the latest banking giant to slam its dividend. Its new rate of $0.05 a share is a brutal 85% hit.
- If you think that's bad, International Paper (NYSE: IP ) is slashing its payout by 90%. Maybe it should eliminate the income entirely and save paper.
- Even gaming companies are feeling the pinch. International Game Technology (NYSE: IGT ) is cutting its distributions by 59%. The company claims it will save $100 million annually on the move, but that only means it will be sending its shareholders $100 million less.
Subscribers to the Income Investor newsletter can appreciate companies that send more and more money to their investors. The newsletter singles out companies that are committed to growing their distributions, with market-thumping results.
Want to see what our team recommends these days? Give the newsletter service a shot with a 30-day trial subscription. Who knows? Maybe the next thing to get hiked will be your interest.
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