One potential response to declining markets is moving a portion of an investment portfolio into equities that continue their extended records of steady dividend hikes.
Income investors seek vehicles that can maintain long streaks of annual dividend increases because these tend to outperform market averages over extended time horizons. Equities with steady dividend hikes generally deliver slightly higher total returns versus investments with flat dividend distributions, and substantially higher total returns over equities that do not pay any dividends.
In addition to higher total returns over the long term, equities with rising dividends also offer some protection against market pullbacks, and fluctuations over the short term. Extended bear markets will certainly lead to dividend cuts and outright dividend eliminations. However, most equities – – especially larger companies with steadily rising dividend distributions – – will generally maintain their rising dividends through minor market pullbacks over short periods.
Furthermore, because the dividend yield is inversely proportional to an equity’s share price, investors get higher yields when buying stocks at lower share prices. Also, unlike other alternative safety investments, such as treasuries, which will become less desirable after markets turn higher, dividend-paying equities can still deliver substantial returns. Therefore, by investing in such equities, investors are under less pressure to shift their funds from the safety of treasuries or cash equivalents, back into stocks to avoid missing the market recovery.
This Week’s Dividend Boost Announcements
Over 700 equities have declared dividend hikes in just the first three weeks of February 2020. In the first two days of this week, 236 equities announced upcoming dividend distributions that are higher than their previous payouts. However, 148 of those announcements are for mutual funds. Mutual funds dividend distributions are just pass-through payouts, and fluctuate based on the amount and timing of dividends from the funds’ underlying holdings. Therefore, we can not consider these as true dividend hikes.
Even if we exclude mutual funds, we still have 88 equities that boosted dividend payouts for their next round of distributions. Some of these remaining equities are small companies, and others have unreliable records of dividend hikes. Therefore, we limited the list below to equities with market capitalizations of at least $1 billion that have boosted their annual dividend payout for at least the past five years.
These constraints yield a list of 18 equities with market capitalizations between $1.02 billion — Armada Hoffler Properties, Inc. (NYSE:AHH) — and nearly $259 billion — Home Depot, Inc. (NYSE:HD). Furthermore, only one company, National Health Investors, Inc. (NYSE:NHI), boosted its annual dividend for the minimum of five years. All other equities on the list have at least six years of dividend boosts. The Sherwin-Williams Company (NYSE:SHW) has the longest streak of 40 consecutive years.
Harley-Davidson, Inc. (NYSE:HOG) has the lowest relative dividend hike with 1.33%. On the top of the list are Carter’s, Inc. (NYSE:CRI) and Domino’s Pizza, Inc. (NYSE:DPZ) with 20% dividend boosts. The dividend yields range from a marginal $0.75% for Humana, Inc. (NYSE:HUM) to nearly 5% for National Health Investors, Inc. (NYSE:NHI).
Sorted by percentage increase, below is the full list of equities that declared dividend hikes so far this week:
Stocks That Declared Dividend Hikes This Week: #18
Harley-Davidson, Inc. (NYSE:HOG)
Previous Dividend Payout: $0.375
New Dividend Payout: $0.38
Dividend Increase: $0.005, (1.33%)
Dividend Yield: 4.64%
Ex-Dividend Date: March 04, 2020
Pay Date: March 20, 2020
Market Cap: $5.01 Billion
Sector: Consumer Products
First Dividend: 1993
Consecutive Annual Hikes: 9 years
February 25, 2020 Closing Price: $32.76
Total Return (1Y, 3Y, 5Y): -7.9%, -34%, -37%
Stocks That Declared Dividend Hikes This Week: #17
Eaton Corporation plc (NYSE:ETN)
Previous Dividend Payout: $0.71
New Dividend Payout: $0.73
Dividend Increase: $0.02, (2.82%)
Dividend Yield: 2.97%
Ex-Dividend Date: March 12, 2020
Pay Date: March 27, 2020
Market Cap: $40.60 Billion
Sector: Industrials
First Dividend: 1923
Consecutive Annual Hikes: 6 years
February 25, 2020 Closing Price: $98.21
Total Return (1Y, 3Y, 5Y): 25.8%, 47%, 55%
Stocks That Declared Dividend Hikes This Week: #16
Royal Bank of Canada (NYSE:RY)
Previous Dividend Payout: $1.05
New Dividend Payout: $1.08
Dividend Increase: $0.03, (2.86%)
Dividend Yield: 0.00%
Ex-Dividend Date: April 22, 2020
Pay Date: May 22, 2020
Market Cap: $115.93 Billion
Sector: Financials
First Dividend: 1870
Consecutive Annual Hikes: 9 years
February 25, 2020 Closing Price: $79.79
Total Return (1Y, 3Y, 5Y): 6.4%, 20%, 53%
Stocks That Declared Dividend Hikes This Week: #15
Armada Hoffler Properties, Inc. (NYSE:AHH)
Previous Dividend Payout: $0.21
New Dividend Payout: $0.22
Dividend Increase: $0.01, (4.76%)
Dividend Yield: 4.87%
Ex-Dividend Date: March 24, 2020
Pay Date: April 02, 2020
Market Cap: $1.02 Billion
Sector: Financials
First Dividend: 2013
Consecutive Annual Hikes: 6 years
February 25, 2020 Closing Price: $18.08
Total Return (1Y, 3Y, 5Y): 23.3%, 47%, 105%
Stocks That Declared Dividend Hikes This Week: #14
National Health Investors, Inc. (NYSE:NHI)
Previous Dividend Payout: $1.05
New Dividend Payout: $1.1025
Dividend Increase: $0.0525, (5.00%)
Dividend Yield: 4.97%
Ex-Dividend Date: March 30, 2020
Pay Date: May 08, 2020
Market Cap: $3.96 Billion
Sector: Financials
First Dividend: 1991
Consecutive Annual Hikes: 5 years
February 25, 2020 Closing Price: $88.75
Total Return (1Y, 3Y, 5Y): 17.4%, 35%, 51%
Stocks That Declared Dividend Hikes This Week: #13
Ryman Hospitality Properties, Inc. (NYSE:RHP)
Previous Dividend Payout: $0.90
New Dividend Payout: $0.95
Dividend Increase: $0.05, (5.56%)
Dividend Yield: 4.81%
Ex-Dividend Date: March 30, 2020
Pay Date: April 15, 2020
Market Cap: $4.07 Billion
Sector: Financials
First Dividend: 1997
Consecutive Annual Hikes: 6 years
February 25, 2020 Closing Price: $79.04
Total Return (1Y, 3Y, 5Y): -0.8%, 36%, 69%
Stocks That Declared Dividend Hikes This Week: #12
Service Corp. International (NYSE:SCI)
Previous Dividend Payout: $0.18
New Dividend Payout: $0.19
Dividend Increase: $0.01, (5.56%)
Dividend Yield: 1.47%
Ex-Dividend Date: March 12, 2020
Pay Date: March 31, 2020
Market Cap: $9.33 Billion
Sector: Services
First Dividend: 1990
Consecutive Annual Hikes: 6 years
February 25, 2020 Closing Price: $51.59
Total Return (1Y, 3Y, 5Y): 23.9%, 72%, 120%
Stocks That Declared Dividend Hikes This Week: #11
Essex Property Trust, Inc. (NYSE:ESS)
Previous Dividend Payout: $1.95
New Dividend Payout: $2.0775
Dividend Increase: $0.1275, (6.54%)
Dividend Yield: 2.61%
Ex-Dividend Date: March 30, 2020
Pay Date: April 15, 2020
Market Cap: $21.01 Billion
Sector: Financials
First Dividend: 1994
Consecutive Annual Hikes: 19 years
February 25, 2020 Closing Price: $317.91
Total Return (1Y, 3Y, 5Y): 17.3%, 47%, 59%
Stocks That Declared Dividend Hikes This Week: #10
Amerisafe, Inc. (NASDAQ:AMSF)
Previous Dividend Payout: $0.25
New Dividend Payout: $0.27
Dividend Increase: $0.02, (8.00%)
Dividend Yield: 1.46%
Ex-Dividend Date: March 12, 2020
Pay Date: March 27, 2020
Market Cap: $1.43 Billion
Sector: Financials
First Dividend: 2013
Consecutive Annual Hikes: 6 years
February 25, 2020 Closing Price: $73.86
Total Return (1Y, 3Y, 5Y): 26.4%, 33%, 120%
Stocks That Declared Dividend Hikes This Week: #9
Allstate Corporation (NYSE:ALL)
Previous Dividend Payout: $0.50
New Dividend Payout: $0.54
Dividend Increase: $0.04, (8.00%)
Dividend Yield: 1.84%
Ex-Dividend Date: February 28, 2020
Pay Date: April 01, 2020
Market Cap: $37.18 Billion
Sector: Financials
First Dividend: 1993
Consecutive Annual Hikes: 6 years
February 25, 2020 Closing Price: $117.31
Total Return (1Y, 3Y, 5Y): 25.8%, 52%, 76%
Stocks That Declared Dividend Hikes This Week: #8
Prologis, Inc. (NYSE:PLD)
Previous Dividend Payout: $0.53
New Dividend Payout: $0.58
Dividend Increase: $0.05, (9.43%)
Dividend Yield: 2.53%
Ex-Dividend Date: March 13, 2020
Pay Date: March 31, 2020
Market Cap: $67.74 Billion
Sector: Financials
First Dividend: 1994
Consecutive Annual Hikes: 6 years
February 25, 2020 Closing Price: $91.70
Total Return (1Y, 3Y, 5Y): 32.5%, 92%, 136%
Stocks That Declared Dividend Hikes This Week: #7
Magna International, Inc. (NYSE:MGA)
Previous Dividend Payout: $0.365
New Dividend Payout: $0.40
Dividend Increase: $0.035, (9.59%)
Dividend Yield: 3.39%
Ex-Dividend Date: March 05, 2020
Pay Date: March 20, 2020
Market Cap: $18.96 Billion
Sector: Consumer Products
First Dividend: 1992
Consecutive Annual Hikes: 10 years
February 25, 2020 Closing Price: $47.14
Total Return (1Y, 3Y, 5Y): -8.3%, 19%, -3%
Stocks That Declared Dividend Hikes This Week: #6
Home Depot, Inc. (NYSE:HD)
Previous Dividend Payout: $1.36
New Dividend Payout: $1.50
Dividend Increase: $0.14, (10.29%)
Dividend Yield: 2.53%
Ex-Dividend Date: March 11, 2020
Pay Date: March 26, 2020
Market Cap: $258.94 Billion
Sector: Services
First Dividend: 1987
Consecutive Annual Hikes: 10 years
February 25, 2020 Closing Price: $237.38
Total Return (1Y, 3Y, 5Y): 28.6%, 73%, 121%
Stocks That Declared Dividend Hikes This Week: #5
McGrath RentCorp (NASDAQ:MGRC)
Previous Dividend Payout: $0.375
New Dividend Payout: $0.42
Dividend Increase: $0.045, (12.00%)
Dividend Yield: 2.21%
Ex-Dividend Date: April 14, 2020
Pay Date: April 30, 2020
Market Cap: $1.85 Billion
Sector: Industrials
First Dividend: 1990
Consecutive Annual Hikes: 19 years
February 25, 2020 Closing Price: $76.04
Total Return (1Y, 3Y, 5Y): 46.5%, 112%, 161%
Stocks That Declared Dividend Hikes This Week: #4
Humana, Inc. (NYSE:HUM)
Previous Dividend Payout: $0.55
New Dividend Payout: $0.625
Dividend Increase: $0.075, (13.64%)
Dividend Yield: 0.75%
Ex-Dividend Date: March 30, 2020
Pay Date: April 24, 2020
Market Cap: $43.86 Billion
Sector: Financials
First Dividend: 1990
Consecutive Annual Hikes: 8 years
February 25, 2020 Closing Price: $332.02
Total Return (1Y, 3Y, 5Y): 9.8%, 63%, 106%
Stocks That Declared Dividend Hikes This Week: #3
The Sherwin-Williams Company (NYSE:SHW)
Previous Dividend Payout: $1.13
New Dividend Payout: $1.34
Dividend Increase: $0.21, (18.58%)
Dividend Yield: 0.97%
Ex-Dividend Date: February 28, 2020
Pay Date: March 13, 2020
Market Cap: $50.81 Billion
Sector: Materials
First Dividend: 1979
Consecutive Annual Hikes: 40 years
February 25, 2020 Closing Price: $550.96
Total Return (1Y, 3Y, 5Y): 27.0%, 80%, 98%
Stocks That Declared Dividend Hikes This Week: #2
Carter’s, Inc. (NYSE:CRI)
Previous Dividend Payout: $0.50
New Dividend Payout: $0.60
Dividend Increase: $0.10, (20.00%)
Dividend Yield: 2.62%
Ex-Dividend Date: March 05, 2020
Pay Date: March 20, 2020
Market Cap: $4.03 Billion
Sector: Consumer Products
First Dividend: 2013
Consecutive Annual Hikes: 6 years
February 25, 2020 Closing Price: $91.72
Total Return (1Y, 3Y, 5Y): -5.7%, 8%, 20%
Stocks That Declared Dividend Hikes This Week: #1
Domino’s Pizza, Inc. (NYSE:DPZ)
Previous Dividend Payout: $0.65
New Dividend Payout: $0.78
Dividend Increase: $0.13, (20.00%)
Dividend Yield: 0.85%
Ex-Dividend Date: March 12, 2020
Pay Date: March 30, 2020
Market Cap: $14.25 Billion
Sector: Services
First Dividend: 2004
Consecutive Annual Hikes: 6 years
February 25, 2020 Closing Price: $368.66
Total Return (1Y, 3Y, 5Y): 45.4%, 102%, 265%
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Ned Piplovic is the assistant editor of website content at Eagle Financial Publications. He graduated from Columbia University with a Bachelor’s degree in Economics and Philosophy. Prior to joining Eagle, Ned spent 15 years in corporate operations and financial management. Ned writes for www.DividendInvestor.com and www.StockInvestor.com.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
