Dividends matter more than many investors realize.
Sure, investing in just the S&P 500 would have gotten you a 66% return over the last five years, but when taking into account dividends, you saw an 85% return.
Over the last 10 years, that difference becomes even greater. The S&P 500 is up 55%, while with dividends it has returned 91%.
Things get even better when you focus on companies that consistently up their dividends. The key here is that companies that steadily increase dividends have solid businesses that allow them to do so.
Investing in those dominant companies is great for your portfolio, as they tend to outperform and also offer investors superior dividends — a win-win.
Already this year, the Vanguard Dividend Appreciation ETF (NYSE: VIG) has outperformed the S&P 500. The Vanguard Dividend Appreciation ETF focuses on dividend achievers — which are the stocks that have at least 10 years of consecutive dividend increases.
Here are the top five dividend increases for November:
Top Dividend Increases: Microsoft (NYSE: MSFT)
One of the largest tech companies in the world is upping its quarterly dividend by 5% this month, soon to be paying $0.69 a share. This $470 billion market-cap company now pays a 2.6% dividend yield. Microsoft has a record of 12 years of consecutive dividend increases.
The big news for Microsoft is that it’s taking direct aim at Apple (NASDAQ: AAPL) with new products. This includes its Surface Studio, which was announced this week, and is being marketed to focused on creative professionals. It’s also shifting toward the fast-growing cloud market by CEO Satya Nadella.
Microsoft shares trade ex-dividend Nov. 15.
Top Dividend Increases: Calavo Growers (NASDAQ: CVGW)
Who knew avocados could sprout dividends? This avocado company is upping its dividend by 13% to $0.90 a share. The company pays an annual dividend and the new increase puts its dividend yield up to 1.5%. It’s now increased its divided by four straight years.
Calavo is rolling out new products as well, even as the avocado business continues to grow. It also has its hands in the tomato and papaya markets. It also has frozen avocado-based products that are in the early stages. In truth, it’s the only avocado company in the market, which could make it a buyout target.
Calavo shares trade ex-dividend Nov. 15.
Top Dividend Increases: Visa (NYSE: V)
Visa, the near-$200 billion market-cap payments giant, is raising its dividend by 18%. It’s now paying out $0.165 a share each quarter. Now, its dividend is still underrated given its yield is just 0.7%. However, it’s still a strong dividend payer — having increased its dividend for seven straight years.
The payments company operates in one of the best growth industries and is in more than 200 countries Visa is also moving head-first into the mobile and digital payments industry. In addition to the dividend, Visa is also a buyback story, as it recently upped its buyback funds to $7.3 billion.
Visa shares trade ex-dividend Nov. 16.
Top Dividend Increases: McDonald’s (NYSE: MCD)
It’s a good month for major market-cap stocks, as this $92 billion market-cap fast food company is upping the quarterly dividend by 6% in November. Shares of McDonald’s now offers a $0.94 a share and its dividend yield is 3.4%. But it gets better — the restaurant has upped its dividend for 39 consecutive years.
McDonald’s has been turning things around nicely. The CEO Steve Easterbrook has launched some impressive initiatives, such as all-day breakfast. Now same-store sales have started to turn around, growing nicely after quarters of declines.
McDonald’s shares trade ex-dividend Nov. 29.
Top Dividend Increases: Lockheed Martin (NYSE: LMT)
Lockheed Martin is upping its quarterly dividend by 10% this month; soon it will pay out $1.82 a quarter. The big defense contractor’s dividend yield is 2.7% and the company has raised its dividend for 13 straight years.
Lockheed has been a steady revenue generator, with plenty of runaway for years. The company does well in times of uncertainty and hostility, as in the current geopolitical situation. Lockheed was just awarded a $6.1 billion Pentagon contract for 57 of its F-35 fighter planes.
Lockheed shares trade ex-dividend Nov. 29.