Dividend Increases – June 2021

Perhaps the most exciting thing about dividend growth investing is receiving news about companies hiking their dividends. This is akin to receiving a pay hike, and lets face it, everybody in the world enjoys that!

The following companies in my portfolio hiked their dividends:

Clorox (Ticker: CLX)

The Clorox Company hiked its dividend by 4.5%, now paying a quarterly dividend of $1.16/share. This marks the 45th year of dividend increases for this Dividend Aristocrat. Over the last five years, this company has managed to grow its dividends at a 5-year CAGR of around 7.59%. The stock is currently trading at a FWD dividend yield of 2.66%. While the increase this time was lower than the 5-year CAGR, I am still bullish as far as long term prospects. Hence, this is one of my core stocks in my dividend portfolio.

UnitedHealth Group (Ticker: UNH)

UnitedHealth Group increased its dividend by 16% to now pay a quarterly dividend of $1.45/share. UNH has been growing its dividends pretty aggressively since the last 5 years, with a CAGR of almost 20%. Hence, this is a growth-like holding in my portfolio. It is generally accepted that healthcare system in the US is “broken”. While that is not so ideal as a consumer, this makes a great investment opportunity.

Caterpillar (Ticker: CAT)

Caterpillar hiked their quarterly dividend by 7.7% at $1.11/share. CAT is on the S&P 500 Dividend Aristocrat index and has been rewarding shareholders with increased dividends for the last 27 years. CAT finds a place in the growth-like category of my portfolio, but I am fully aware about its cyclicality and how the recent climb in stock price might be just a part of that trend.

Target (Ticker: TGT)

The biggest surprise in this list as far as dividend increases came from yet another Dividend Aristocrat. Target hiked its quarterly dividend by a whopping 32.3% at $0.90/share. This represents the 54th consecutive year of dividend increase for this company. The reason for the surprise was that Target has a rather low 5-year CAGR of 3.9% (actually their 3-year CAGR is 3.1 %). While I was expecting a larger increase especially after their stellar earnings beat during the last quarter, I was certainly not expecting such a large increase. Just goes to show that if you hold quality companies where the management’s interests align with that of the long-term shareholder, these companies will eventually reward you handsomely.

T. Rowe Price Group (Ticker: TROW)

TROW, yet another dividend aristocrat, made my day when they declared a special $3.00/share dividend. This after having hiked their quarterly dividend by ~20% earlier this year. Simply speechless! 🙂

I sincerely thank the hard-working employees at all these companies!

Disclosure: Long CLX, UNH, CAT, TGT, TROW.