It has become almost impossible to argue against the notion that investors love dividends. They also love stock buyback announcements from companies, but when investors have owned a stock for a long time they really love to see when the dividend keeps getting hiked. That sends their effective yield much higher than the stated yield for new investors.
24/7 Wall St. has evaluated many dividend hikes over the years, and we have identified five coming dividend hikes that investors can bank on this summer. One of the five actually announced its hike before this was published, so we also included three runner-up dividend hikes expected before the end of summer.
When it comes to corporate governance, companies return capital to shareholders via dividends and buybacks. This can get tricky for the multinational companies with strong overall balance sheets when their cash is domiciled outside of the United States.
Many Dow Jones Industrial Average and S&P 500 Index companies have already raised their dividends so far in 2015. The following dividend hikes are expected to be announced this summer: Altria Group Inc. (NYSE: MO), Caterpillar Inc. (NYSE: CAT), FedEx Corp. (NYSE: FDX) and Target Corp. (NYSE: TGT).
Insurance giant UnitedHealth Group Inc. (NYSE: UNH) managed to announce the hike before this new round of summer dividend hikes could get issued.
24/7 Wall St. has also included a basic review of these three runner-up dividend hike candidates: Applied Materials Corp. (NASDAQ: AMAT) is still on the fence, while Brinker International Inc. (NYSE: EAT) and Intuit Inc. (NASDAQ: INTU) are likely to be seen later in the summer.
As a reminder, much dividend and buyback growth in major companies appears to have peaked. That would leave investors perhaps wanting to reward companies that keep raising dividends and having buybacks. These are the expected dividend hike announcements that investors can bank on this summer: