Dividend checks continue to get fatter in corporate America, as more companies jack up their distribution rates.
Readers of the Income Investor newsletter can certainly appreciate that kind of thinking. Let's take a closer look at some of the companies that inched their payouts higher these past few days.
We can start with PotashCorp (NYSE:POT). The leading provider of crop nutrients is also fertilizing its quarterly distributions. PotashCorp's rate is going from $0.28 a share to $0.35 a share. It's a big move, but investors should be used to this by now. The company has come through with five increases over the past two years.
Safeway (UNKNOWN:SWY.DL) stakeholders are also checking out. The grocery store operator is boosting its quarterly dividend 14% to $0.20 a share. The 1,641-unit chain is pumping up its yield at a time when weaker rivals have been slashing their disbursements. Troubled competitor SUPERVALU stopped paying distributions altogether last year, even though a recent asset sale may pave the way for a brighter future.
KeyCorp (NYSE:KEY) is also banking on bigger withdrawals. The financial services provider with $89.2 billion in assets is pushing its quarterly rate 10% higher to $0.055 a share. It's not the only way that KeyCorp is returning money to its shareholders. A $426 million share repurchase plan was approved two months ago.
Finally, we have Southwest Airlines (NYSE:LUV) taking off. The popular airline where bags fly free is boosting its quarterly dividend 33% to $0.04 a share. Southwest is also increasing its share buyback authorization from $1 billion to $1.5 billion.
Why not? Airlines are flying high again as sector consolidation is boosting airfares and cheaper jet fuel is resulting in widening profit margins. Analysts see Southwest's earnings nearly doubling this year.
Checks and balances
Subscribers to the Income Investor newsletter can appreciate the companies sending more and more money to their investors. The newsletter singles out companies that are committed to growing their distributions with market-thumping results. A 30-day trial subscription will let you see if it's right for you.