These 3 Big Companies Just Raised Their Dividends

The past few days have seen a baker's dozen of firms hike their distributions. Here are three of the more prominent ones.

Jul 14, 2014 at 2:00PM

Following a lull in the opening days of this month, last week was a strong one for dividend raises. By my count, no fewer than 13 publicly traded companies hiked their distributions. There were more than a few heavy hitters among that group. Here's a look at a trio of them.

The biggest rise out of our three selections is sturdy engineering company Cummins (NYSE:CMI), which hiked its payout by nearly 25% to $0.78 per share. The firm also refreshed its $1 billion stock repurchase program, which will renew at the same amount once the current initiative expires.

It has plenty of reason to be optimistic. Its most recently reported quarter was a good one, with revenue climbing 12% to $4.4 billion year over year and attributable net profit improving 20% to $338 million. 

Still better, Cummins is predicting that sales, at least, will continue to move north. The company is forecasting annual growth of 6% to 10% for the entirety of fiscal 2014. 

Meanwhile, at the end of said quarter, it had just over $2.3 billion in cash and short-term investments -- more than enough to pay the roughly $143 million bill for that fattened dividend and a good chunk of those share buybacks.

Cummins' new distribution will be paid on Sept. 2 to shareholders of record as of August 22. It equates to a yield of just over 2% at the current stock price.

Saying that "a compelling dividend remains a top priority for our company," oil multinational ConocoPhillips (NYSE:COP) has backed up its words with a 6% lift in its payout to $0.73 per share.

This is the firm's second increase in as many years, following the spinoff of its downstream operations into a separate, publicly traded company in May 2012. 

Since then, the latter firm has more than doubled its dividend, from a debut payout of $0.20 per share to the upcoming $0.50. ConocoPhillips buy-and-holders, then, have made out pretty well in the recent past.

The mother company is a massive enterprise, and as you'd expect ConocoPhillips has a lot of cash and equivalents on hand. $7.7 billion of the stuff, to be exact, as of the end of its Q1. The upcoming dividend payout, meanwhile, will total a shade less than $900 million quarterly. As such, we can expect the ConocoPhillips dividend well to keep pumping out for shareholders.

The firm will hand out its increased distribution on September 2 to holders of record as of July 21. At the moment, said distribution yields 3.4% at ConocoPhillips' current share price.

Enterprise Products Partners
In terms of dividend raising frequency, the above two companies have nothing on Enterprise Products Partners (NYSE:EPD). The midstream energy partnership last week pulled the trigger on its 40th increase in a row.

The partnership manages to keep this up through incremental hikes of $0.01 per unit or so every quarter. This is the amount of the latest increase, with Enterprise now on the hook for $0.72 per unit. 

The partnership is managing to improve its financials more than many expected. Enterprise's Q1 net trounced analyst estimates, rising 6% on a year-over-year basis to hit almost $800 million for an EPS of $0.85 per unit, against the average expectation of $0.75. Revenue advanced more energetically, growing by 13% to $12.9 billion. 

Topping both line items in terms of growth was perhaps the most important one of all for the partnership's income-loving unit holders -- distributable cash flow. This rose by 19% to $1.07 billion. So Enterprise should have no problem covering a dividend hike that's barely over 1%. And considering the way its fundamentals are improving, we can probably count on that payout continuing its steady rise.

Enterprise's upcoming distribution will be paid on Aug. 7 to unit holders of record as of July 31. That $0.72 per share yields 3.7%.

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Eric Volkman has no position in any stocks mentioned. The Motley Fool recommends Cummins and Enterprise Products Partners, and owns shares of Cummins. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

So you can imagine how shocked I was to find out Warren Buffett recently told a select number of investors about the cutting-edge technology that's keeping him awake at night.

This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

That's how Buffett responded when asked about this emerging market that is already expected to be worth more than $2 trillion in the U.S. alone. Google has already put some of its best engineers behind the technology powering this trend. 

The amazing thing is, while Buffett may be nervous, the rest of us can invest in this new industry BEFORE the old money realizes what hit them.

KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

Even one legendary MIT professor had to recant his position that the technology was "beyond the capability of computer science." (He recently confessed to The Wall Street Journal that he's now a believer and amazed "how quickly this technology caught on.")

Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

Think about how many amazing technologies you've watched soar to new heights while you kick yourself thinking, "I knew about that technology before everyone was talking about it, but I just sat on my hands." 

Don't let that happen again. This time, it should be your family telling you, "I can't believe you knew about and invested in that technology so early on."

That's why I hope you take just a few minutes to access the exclusive research our team of analysts has put together on this industry and the one stock positioned to capitalize on this major shift.

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David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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