Investing

3 Stocks to Buy on Recent Dividend Hikes

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Several companies have been delivering positive news to shareholders lately, including dividend increases.

When a company opts to raise its dividend, it indicates confidence in its current standing. In addition, it reflects the company’s commitment to returning value to shareholders, which is undoubtedly encouraging.

Three companies – Clorox CLX, The Hershey Company HSY, and McKesson MCK – have all recently declared a dividend hike. For those with an appetite for income, let’s take a closer look at how each company currently stacks up.

Clorox

Clorox markets some of the most trusted and recognized brands, including its namesake bleach and cleaning products. The company recently announced a modest 2% hike to its quarterly dividend, up to $1.20 per share.

The company has increasingly rewarded its shareholders. Impressively, 2023 reflected Clorox’s 21st consecutive year of increased payouts.

Clorox posted results that came in well above expectations in its latest print, exceeding the Zacks Consensus EPS Estimate by more than 40% and delivering a 7% revenue surprise. Shares saw bullish activity post-earnings, as the results impressed the market.

The Hershey Company

Hershey is a well-known manufacturer of chocolate and non-chocolate confectionery. The company recently unveiled a solid 15% boost to its quarterly dividend to $1.19 per share. Like CLX, Hershey has been committed to increasingly rewarding its shareholders, paying an uninterrupted dividend since 1930.

The company’s shares aren’t expensive on a relative basis, with the current 23.4X forward earnings multiple (F1) nicely beneath the 25.1X five-year median and highs of 29.2X in 2022. The stock carries a Value Style Score of “C.”

In addition, the company has solid growth projections, with the Zacks Consensus EPS Estimate of $9.54 for its current year suggesting a 12% year-over-year improvement on 8% higher revenues. Looking ahead to FY24, expectations allude to a further 8% climb in earnings on 4% increased sales.

McKesson

McKesson Corp. is a healthcare services and information technology company. Analysts have become positive surrounding the company’s earnings outlook, helping land the stock into a favorable Zacks Rank #2 (Buy).

The revisions trend has been particularly positive for its current year, with the $26.96 per share Zacks Consensus Estimate up nearly 4% since August of last year.

The company recently announced a 15% increase to its quarterly dividend, bringing the payout to $0.62 per share. Like those above, McKesson has consistently increased its payout, fully reflecting its shareholder-friendly nature.

Bottom Line

Investors love dividends, especially whenever the payouts received are consistently boosted by companies.

And that’s precisely what shareholders of all three companies above -– Clorox CLX, The Hershey Company HSY, and McKesson MCK – have enjoyed, with all three increasingly rewarding their shareholders over the years.
Hershey Company (The) (HSY): Free Stock Analysis Report

McKesson Corporation (MCK): Free Stock Analysis Report

The Clorox Company (CLX): Free Stock Analysis Report

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Zacks Investment Research

This article originally appeared on Zacks

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