Dividends have continued to rise. Better yet, they are expected to keep rising for the rest of the year. A study from Dow Jones Indexes showed a rise of almost 2.2% so far this year from the 30 Dow Jones Industrial Average from the previous quarter, but this is expected to be up by 8.4% for the total year in 2012 over 2011. To show just how important and relevant the DJIA still is for investors, the DJIA’s 30 components account for 37% of the total U.S. stock market payouts with their $107 billion expected to be paid out.
The Dow Jones Survey noted that the DJIA companies expected to pay out over $6 billion in 2012 (annualized) are as follows:
AT&T, Inc. (NYSE: T) was expected to be at $10.5 billion in indicated annual dividends. It is the highest yield of about 5.7% in the DJIA.
Exxon Mobil Corporation (NYSE: XOM) is expected to be $9.1 billion in indicated annual dividends. This is the largest market cap in the DJIA of over $400 billion, so even a 2.2% yield generates a lot in raw dollars.
General Electric Co. (NYSE: GE) is expected to pay out $7.2 billion in its indicated annual dividends. GE’s yield is now about 3.5%.
Pfizer Inc. (NYSE: PFE) is expected to be at $6.8 billion in indicated annual dividends. Pfizer’s yield is about 3.9% today.
Chevron Corporation (NYSE: CVX) is expected to be $6.5 billion in indicated annual dividends. Chevron is worth about half of Exxon in market capitalization but it offers a yield of about 3.2%.
Johnson & Johnson (NYSE: JNJ) is expected to be $6.2 billion in indicated annual dividends. J&J yields about 3.6%.
Microsoft Corporation (NASDAQ: MSFT) is expected to be $6.0 billion in indicated annual dividends. Microsoft yields about 2.5%, which is not great for a DJIA stock but still high for a tech stock considering its recent rally.
Procter & Gamble (NYSE: PG) is expected to be $5.8 billion in indicated annual dividends. P&G yields about 3.3%.
The six DJIA companies which have recently increased their payouts are as follows: Cisco Systems, Inc. (NASDAQ: CSCO) with a 33% hike but still with a low payout rate; J.P. Morgan Chase & Co. (NYSE: JPM) by 20% even if we were disappointed with its dividend hike; Pfizer Inc. (NYSE: PFE) by 10%; Wal-Mart Stores, Inc. (NYSE: WMT) by almost 9%; The Coca-Cola Company (NYSE: KO) by 8.5%; and 3M Co. (NYSE: MMM) by almost 7.3%.
Speaking of high-yield and value, the utility sector is looking ripe in value after the shares have pulled back about 10% from their highs with dividend yields of 5% and more in the top four picks expected to still grow.
Dividend investors have had to be a bit more patient in 2012, but the trend for higher payouts appears to still be in place.
JON C. OGG