Last week we began a series of companies which we expect will raise their dividends in 2011.  It was the first piece of a series and there are many other companies which we expect to boost their dividends in 2011.  Some may seem obvious while others will not.  We are looking for dividend hikes in 2011 from companies such as Abbott Laboratories (NYSE: ABT), American Water Works Company, Inc. (NYSE: AWK), Dr. Pepper Snapple Group, Inc. (NYSE: DPS), Exxon M
obil Corporation (NYSE: XOM), Kimberly-Clark Corporation (NYSE: KMB), NextEra Energy, Inc. (NYS: NEE), NextEra Energy, Inc. (NYS: NEE), and Wal-Mart Stores, Inc. (NYSE: WMT).

We have gone through the dividend history of each company here to outline a proper dividend growth history.  Then we have looked at industry trends and earnings trends to interpolate the dividend coverage ratios to see how high companies could raise their dividends and even what the realistic dividend hikes would look like.  There is also of course a yield analysis attached and the prospects ahead that make each attractive to dividend growth investors.

Abbott Laboratories (NYSE: ABT) is a company which could announce a dividend hike later in the first quarter of this year.  After all, Abbott generally raises its dividend yearly and it is due after four quarters of $0.44 for a dividend. Abbott’s yield of 3.7% tops J&J, but lags Merck and Pfizer.  At $47.92, its 52-week range is $44.59 to $55.66 and it already carries a 3.70% dividend yield.  The company may want to draw attention to its stock and a dividend hike after earnings season may just be what the doctor ordered.

American Water Works Company, Inc. (NYSE: AWK) is still one of our Top 10 Companies To Hold For The Next Decade and it was also named The Best Water Stock for 2011 of our own water sector coverage.  The growth will continue as long as it stays on its current path.  The company has the broadest public water utility portfolio out there and that gives it a virtual monopoly in each of its local markets.  It has about 16 million customers in 35 states and two Canadian provinces and a fresh asset sale in New Mexico and Arizona for $470 million changes nothing by our count.

We have identified this as a dividend grower in early 2010 and we expect a repeat performance in 2011.  The current $0.88 annualized payout compares to earnings expectations for 2010 of $1.52 EPS and $1.62 EPS for 2011.  We won’t expect another dividend hike before the summer here, but that $0.22 quarterly payout is likely to rise to $0.23 or $0.235 this year.  At $25.59, this one keeps hitting new 52-week highs almost each month and it has rarely offered any pullbacks to eager investors.

Dr. Pepper Snapple Group, Inc. (NYSE: DPS) is much younger as a public company compared to PepsiCo and Coca-Cola, at least this time around.  Last year the company noted that it intended to hike its payout after it paid off more debt and regained its investment-grade rating.  Even after fresh debt offerings after retiring debt at the end of 2010, those investment-grade ratings hold.  We do not expect an imminent hike from the beverage giant with some 50 different brands.  We would also did not expect the same 67% hike seen in 2010 as it caught up to peers on the shareholder payout game.

Dr. Pepper’s $0.25 dividend is likely to be boosted to $0.30 per quarter or $1.20 per year.  Earnings expectations are $2.38 EPS for 2010 and $2.77 EPS for 2011.  This offers more than ample dividend coverage as its 2.8% dividend is pretty much on par with Coca-Cola and Pepsi.  We believe that Dr. Pepper Snapple wants to differentiate itself as a higher dividend yield.  This dividend hike may come closer to the middle of 2011.  At $65.87, its 52-week range is $58.75 to $68.11.

Exxon Mobil Corporation (NYSE: XOM) has a surprisingly low dividend considering that it is America’s largest oil and gas play.  The company continues to repurchase stock as if there is no tomorrow, and the reason the dividend is not even higher is because it had to digest that XTO acquisition.  Fortunately, that was a stock-for-stock merger rather than a buyout which would have eaten up all of its cash and available liquidity.  The two most recent dividend hikes were only by two-cents per quarter and the current $0.44 dividend (or $1.56 per year) is one we expect to be raised higher than just two-cents this year.

This Exxon dividend hike may not come before the second quarter, but there is more than enough dividend coverage here to reward shareholders more. Thomson Reuters has estimates of $5.91 EPS for 2010 and $6.77 EPS for 2011.  Shares just hit a new high last week and its $78.98 closing price offers a current yield of about 2.2% to investors today.  It is time for Big Oil to boost its payout here yet again.  Our take is that the dividend gets hiked to $0.48 per quarter at the next dividend hike.