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5 Companies That Always Raise Their Dividend

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My mission was simple: to identify the strongest dividend-paying companies in the market.

I didn't care about finding the absolute highest yield or the longest running streak of dividend payments. What was important to me was to find companies with strong cash flows capable of future dividend hikes across broad market sectors. It wasn't enough to just be a dividend-paying blue chip; I wanted to see remarkable dividend growth over time. What I uncovered are five companies that have always raised their dividend!

Company Dividend Yield Years Paying Times Raised
Alliance Resource Partners (Nasdaq: ARLP  ) 4.97% 11 23
Bemis (NYSE: BMS  ) 2.85% 25 25
Clorox  (NYSE: CLX  ) 3.57% 27 27
AT&T (NYSE: T  ) 5.76% 26 27
HCP (NYSE: HCP  ) 5.00% 22 65

Alliance Resource Partners is the baby of the list, producing and marketing coal for utility companies. Sure, it's only been paying a dividend for 11 years, but it has raised that dividend an impressive 23 times without a drop. Its last dividend payment was 622% higher than its quarterly distribution level in 1999.

Don't let the lowest dividend yield on this list fool you. Bemis is no slouch in the packaging sector. It has been paying a dividend for 25 years and has raised it just as many times without a single drop. If you've been holding Bemis stock since 1985, you've seen your dividend jump by 1,372% in that time.

Chances are you're pretty familiar with Clorox's cleaning and household products. What I find unlikely is that you knew it's been paying a dividend for 27 years without a single drop in that dividend. Based on the 27 times it has raised that dividend, shareholders are receiving a whopping 2,833% more than its payment in 1983.

"Ma Bell" may be no more, but AT&T churns out the highest yield on this list at 5.76%. So I have to admit, this telecommunications behemoth had one dividend hiccup in 2004, but it's still managed to increase its quarterly dividend 27 times over 26 years for a 260% jump in payment since 1984.

HCP is the real shocker on this list. It's a health-care real-estate investment trust sporting a 5% yield. HCP has paid a dividend for 22 years and raised that dividend a staggering 65 times! Do the math: That means that three out of every four quarters, shareholders are getting a raise. Over 22 years, shareholders have received a 191% increase in their quarterly distribution.

Should this be the end of your research on these companies? Absolutely not! But a company that takes care of shareholders is usually a fantastic start, and I'm all for giving yourself and your portfolio a raise.

Do you have a favorite dividend play I've ignored? Feel free to let me know in the comment section below!

More dividend-happy Foolishness:

We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

Fool contributor Sean Williams does not own shares in any companies mentioned in this article. You can follow him on CAPS under the screen name TMFUltraLong. Alliance Resource Partners and Clorox are Motley Fool Income Investor selections. Try any of our Foolish newsletter services free for 30 days. The Motley Fool has a disclosure policy.

Read/Post Comments (3) | Recommend This Article (6)

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  • Report this Comment On January 05, 2011, at 6:34 PM, midnightmoney wrote:

    If arlp offered a drip program I'd buy it yesterday

  • Report this Comment On January 06, 2011, at 1:29 PM, Hal67 wrote:

    ARLP has almost single handedly restored my portfolio to Pre-Obama levels. Thanks ARLP

  • Report this Comment On January 06, 2011, at 1:52 PM, Fundament wrote:

    Here is a sheet of Dividend Champions. Those stocks increased dividends over more than 25 years without a break:

    The average dividend-yield of the Dividend Champions list amounts to 2.92 percent while the average payout ratio is 0.44. As a result, an average P/E ratio of 16.64 is calculated. You can find 70 additional stocks there.

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