After years of a low interest rate environment, which has been trending higher over the past 12 months, many investors have turned to equities not only for the growth potential but also for solid and dependable dividends that help to provide a passive income stream. What this equates to is total return, which is one of the most powerful investment strategies going. While interest rates have risen, these companies still make sense for investors looking for solid growth and income potential.

We like to remind readers about the impact total return has on portfolios because it is one of the best ways to help improve the chances for overall investing success. Again, total return is the combined increase in a stock’s value plus dividends. For instance, if you buy a stock at $20 that pays a 3% dividend, and it goes up to $22 in a year, your total return is 13%: 10% for the increase in stock price and 3% for the dividends paid.

Three top companies that are Wall Street favorites are expected to raise their dividends this week. So we screened our 24/7 Wall St. research universe and found that all are rated Buy at some of the top firms on Wall Street. While it is always possible that not all of them do raise their dividends, top analysts expect them to, given past increases in each firm’s dividend payouts.

It is important to remember that no single analyst report should be used as a sole basis for any buying or selling decision.

Caterpillar

This large cap leader is a solid idea for growth and income investors who are more conservative. Caterpillar Inc. (NYSE: CAT) is the world’s largest manufacturer and marketer of construction equipment, and it is also a leading manufacturer of diesel engines and turbines for transport and industrial applications.

Caterpillar is the world’s leading manufacturer of construction and mining equipment, diesel and natural gas engines, industrial gas turbines and diesel-electric locomotives. The company principally operates through its three primary segments (Construction Industries, Resource Industries and Energy & Transportation) and also provides financing and related services through its Financial Products segment.

Investors currently receive a dividend of 2.12%. The company is expected to raise the dividend to $1.26 per share from $1.20.

Stifel has a $275 target price on Caterpillar stock. The consensus target is lower at $236.58, and shares closed on Monday at $222.47.

Ralph Lauren

With top fragrances and clothing lines, this is always a solid pick for investors. Ralph Lauren Corp. (NYSE: RL) designs, markets and distributes lifestyle products in North America, Europe, Asia and elsewhere.

The company offers apparel, including a range of men’s, women’s and children’s clothing and accessories, which comprise casual shoes, dress shoes, boots, sneakers, sandals, eyewear, watches, fashion and fine jewelry, scarves, hats, gloves, umbrellas, and belts, as well as leather goods, such as handbags, luggage, small leather goods, and belts; home products consisting of bed and bath lines, furniture, fabric and wallcoverings, lighting, tabletop, floor coverings, and giftware; and fragrances.

The company sells apparel and accessories under the Ralph Lauren Collection, Ralph Lauren Purple Label, Polo Ralph Lauren, Double RL, Lauren Ralph Lauren, Polo Golf Ralph Lauren, Ralph Lauren Golf, RLX Ralph Lauren, Polo Ralph Lauren Children, Chaps, and Club Monaco brands; women’s fragrances under the Ralph Lauren Collection, Woman by Ralph Lauren, Romance Collection, Ralph Collection, and Big Pony Women’s brand names; and men’s fragrances under the Polo Blue, Safari, Purple Label, Polo Red, Polo Green, Polo Black, Polo Supreme, Polo Sport, and Big Pony Men’s brand names.
The company’s restaurant concepts include The Polo Bar in New York City, RL Restaurant in Chicago, Ralph’s in Paris and Ralph’s Coffee concept.

Ralph Lauren sells its products to department stores, specialty stores and golf and pro shops, as well as directly to consumers through its retail stores, concession-based shop-within-shops and its digital commerce sites. The company directly operates 548 retail stores and 650 concession-based shop-within-shops, and it operates 139 Ralph Lauren stores and 143 Club Monaco stores and shops through licensing partners.

The current dividend yield is 2.83%. The expected increase is to $0.775 a share from $0.750.

UBS has set its price objective at $168, and Ralph Lauren stock has a consensus target of $129.67. On Monday, the closing share price was $113.18.

UnitedHealth

A whopping 45% of fund managers recently surveyed have bought shares of this company. UnitedHealth Group Inc. (NYSE: UNH) operates through the following four segments.

Its UnitedHealthcare segment offers consumer-oriented health benefit plans and services for national employers, public sector employers, midsized employers, small businesses and individuals; health and well-being services to individuals age 50 and older, addressing their needs for preventive and acute health care services, as well as services dealing with chronic disease and other specialized issues for older individuals; and Medicaid plans, Children’s Health Insurance Program, and health care programs; and health and dental benefits.

The OptumHealth segment provides access to networks of care provider specialists, health management services, care delivery, consumer engagement and financial services. This segment serves individuals through programs offered by employers, payers, government entities and directly with the care delivery systems.

The OptumInsight segment offers software and information products, advisory consulting arrangements, and services outsourcing contracts to hospital systems, physicians, health plans, governments, life sciences companies and other organizations.

OptumRx is the segment that provides pharmacy care services and programs, including retail network contracting, home delivery, specialty and compounding pharmacy, and purchasing and clinical. It also develops programs in areas such as step therapy, formulary management, drug adherence and disease/drug therapy management.

Shareholders are paid a 1.35% dividend. It is expected that UnitedHealth will raise the dividend nicely to $1.85 from $1.65.

Oppenheimer’s $610 target price is well above the $555.14 consensus target, and UnitedHealth Group stock ended Monday’s trading session at $498.19.

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Three top companies with stocks rated Buy across Wall Street are expected to lift the dividends they pay to shareholders. Not only is increasing dividends and returning capital to investors important, but it also shows that the company is doing well and has the earnings and cash flow strength to increase the payouts.

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