The Great Dividend Hikes Of 2011 Are Underway (CCL, OKE, FINL, JPM, WFC, BAC, CSCO, AAPL, GE, UTX, MMM, WPO)

Carnival Corporation plc (NYSE: CCL) is not known for being a large dividend payer due to a 0.8% current yield.  That is about to change.  On Thursday the cruise line operator issued an astonishing 150% hike to its payouts.  The old $0.10 dividend is now to be $0.25 per quarter. That is suddenly a 2.2% dividend for new shareholders. Carnival reinstated its dividend after the end of the recession.  It also is trying to express business confidence and increased cash flows and lower cap-ex commitments.

Oneok Inc. (NYSE: OKE) may not be a household name as a distributor of natural gas, but its dividend growth has been extremely impressive.  This week the company boosted its quarterly payout.  The 8% gain was not the impressive part.  What was so impressive is that this was the fourth dividend hike in the last year.  The new rate is $0.52 per quarter rather than $0.48 and this is in-line with what the company gave last year when it said it aims to boost its dividend by 50% or 60% by the year 2013.  The goal is backed by what the company is calling strong cash flows and stable earnings growth.  The new dividend based upon today’s share price of $57.60 generates a 3.6% payout to holders.

Finish Line Inc. (NASDAQ: FINL) is probably going to be a bit difficult to get overly excited about, but this morning it did boost its $0.04 dividend per quarter up by 25% to $0.05.  The former 1% yield will now be 1.25%.

Jamie Dimon of J.P. Morgan Chase & Co. (NYSE: JPM) is likely to be the first CEO to raise the dividend of the banking giants.  The paltry 0.4% dividend yield pales in comparison to before the recession and before the TARP bailout.  The current $0.05 dividend per quarter used to be $0.38 per quarter.  Due to regulatory oversight, it is likely going to be some time before $0.38 is seen each quarter again.  What we do expect is a jump to roughly $0.20 per quarter and we expect that to come before summer of this year.  That would get the common yield close to 2.0%, and we expect Jamie Dimon to say “More dividend hikes are coming through time.”  A payout of $0.80 per year compares to Thomson Reuters estimates of $4.68 EPS for 2011 earnings estimates. Here is the good news: our first dividend reinstatement rate may still be too conservative.

Second on the list is Wells Fargo & Co. (NYSE: WFC).  Its CEO has also promised a return to a higher more normalized dividend rate.  Just don’t expect the current payout of $0.05 per quarter to return to the old $0.34 per quarter rate. The current yield of 0.6% will grow and we expect much of the same from Warren Buffett’s favorite bank as we would from J.P. Morgan.  The payout may go to $0.15 to $0.18 at first, also with the promise of higher payouts.  A $0.60 to $0.80 payout per year compares to Thomson Reuters estimates of $2.78 EPS for 2011 earnings estimates. Wells Fargo is also expected to retire some classes of trust preferred stock as well.