recent-dividend-increases

Dividend stocks are always enticing because of the regular income they throw off.  Now all dividend stocks are created equal, however, as some have high yields that are too good to be true.  Wouldn’t it give you peace of mind to know there were stocks that have paid dividends reliably for decades, that they just raised their dividends again, and that you can invest in them today?

Look no further.  These four dividends stocks have attractive yields that would make any income investor happy.  Even better, they are safe and solid brand names with recent dividend increases that are ideal for investors of all stripes.

Dividend Increase #1: American Express (NYSE:AXP)

Most people think of AXP stock as just a credit card company with a travel division.  That’s not the case. The legendary company has other major divisions that drive strong revenue growth.

AXP stock generates revenue from stored value products like prepaid debit cards, where it is experiencing rapid growth.  It also offers network and merchant services for processing data.  This include point-of-sale products.

AXP also tacks on marketing and information services for merchants, along with fraud prevention.  As for credit cards, AXP stock derives revenues not only from annual fees but from interest payments for cardholders that carry balances.

AXP has a stellar balance sheet, carrying no long-term debt to finance its operations. As a result, it always ends up with massive amounts of free cash flow.  AXP stock had $8.6 billion of FCF in FY11, $6 billion in FY12, and $7.5 billion in FY13.  AXP has been conservative with its dividend, only putting out 10-15% of its FCF as a dividend.

That dividend just increased by 13%, from 23 cents to 26 cents per share, giving AXP stock a 1.2% yield.

Dividend Increase #2: Newell Rubbermaid (NYSE:NWL)

Newell Rubbermaid remains a premier brand in the world of diversified consumer and commercial products.  It owns numerous brands investors would recognize —

Sharpie, Paper Mate, Expo, Parker, Waterman, Dymo, Rubbermaid, Calphalon, Goody, Lenox, and Graco, just to name a few.  It operates five divisions that sell what most would consider quasi-essentials, and that’s why NWL stock remains an ongoing dividend payer.

People need food storage products, cookware, cutlery, and kitchen gadgets. The company sells hardware, label makers, and printers, not to mention cleaning products, car seats, strollers, and highchairs.

It isn’t a coincidence that these products are so diversified.  By refusing to limit itself to manufacturing for one niche, the company guarantees that its revenue streams will never be wiped out if people suddenly boycott, say, office supplies.

NWL stock falls squarely in the Peter Lynch stalwart category, and that is where investors often see legacy dividend players like NWL.  The company just pushed its dividend up to 17 cents per share, which is a 2.3% yield.

Dividend Increase #3: Clorox Company (NYSE:CLX)

Clorox may not sound exciting to investors, and some may even see it as a stodgy old bleach product business.  Would you believe, however, that CLX stock moved into other areas that include dressings and sauces, water filtration systems, and person care products?  That doesn’t include the vast legacy cleaning product business.

All these products generate over $5 billion in revenue every year because, similar to NWL stock, it sells quasi-staples.  People need to clean their homes.  Although growth has been sluggish with CLX stock, the company is rock-solid consistent with FCF, generating some $500 million every year.  Some 60% of it routinely is paid out as a dividend, now paying $2.96 annually, or 3.3%.

Dividend Increase #4: Safeway (NYSE:SWY)

Grocery stores have been struggling the past few years as competitors like Whole Foods Market (NYSE:WFM) and dollar stores like Dollar Tree Stores (NASDAQ:DLTR) have stolen market share with new or cheaper products.  However, you cannot get any safer than SWY stock, and here’s why:  a private equity consortium has purchased the venerable brand for $40 per share.

So while the deal is worked through, Safeway’s price has a floor built-in, and a safe dividend as a result.  The $0.92 per share annual payout is equal to a 2.7% yield.

Well, that’s it for theses recent dividend increases. Do you already own stock in any of these companies? What are your top dividend stocks? Let us know in the comment section below.

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Published by Wyatt Investment Research at