Businesses that hike their dividend payout on a consistent basis have the ability to:
- Protect investors from the ravages of inflation.
- Provide an ever-increasing stream of income.
- Outperform the stock market over the long term.
Let’s take a quick look at three stocks that significantly upped their dividend payout in recent weeks.
One of them could be worth purchasing with some of your spare change.
Leading off our list is coffee chain giant Starbucks, which pumped its quarterly dividend 9% earlier this week to 49 cents per share.
Since initiating a dividend program in 2010, the company has increased its payout for 11 consecutive years.
The company’s shareholder-friendly capital returns continue to be backed by a globally recognized brand, continued expansion initiatives in places like China and Japan, and robust cash flows.
Over the past 12 months, Starbucks has produced $4.3 billion in free cash flow. And yet the company was still able to open 635 net new stores worldwide in the first nine months of 2021.
Starbucks shares currently sport a dividend yield of 1.7%, which is a bit lower than that of other quick-serve plays like McDonald’s (2.3%), Wendy’s (2.2%), and Restaurant Brands International (3.4%).
But given Starbucks’ growth trajectory, the lower yield is still worth grabbing with a few digital nickels and dimes.
Lockheed Martin (LMT)
With a quarterly dividend hike of nearly 7.7% last week, U.S. defense leader Lockheed Martin is next on our list.
The company will now pay shareholders a quarterly dividend of $2.80 per share versus the previous rate of $2.60 per share. Lockheed’s board also approved a fresh share buyback plan of $6 billion.
Lockheed has increased its annual dividend for 19 consecutive years.
More importantly, the company’s well-entrenched position in the military space, coupled with a still-growing U.S. defense budget, suggests that those dividend hikes won’t stop anytime soon.
The stock has slumped in recent months, down 12% from its 52-week highs set in May. But the weakness is providing dividend investors with a tempting opportunity.
Currently, Lockheed shares offer an attractive dividend yield of 3.2%, higher than that of close rivals like General Dynamics (2.4%), Raytheon (2.3%), and Boeing (no dividend).
To be sure, Lockheed trades at $348 per share. But you can get a piece of Lockheed using a popular stock trading app that allows you to buy fractions of shares with as much money as you are willing to spend.
JP Morgan Chase & Co. (JPM)
Rounding out our list is banking gorilla JP Morgan, which declared a quarterly dividend of $1.00 per share last week, up 11% from the previous rate of 90 cents per share.
When it comes to the financial services sector, JP Morgan’s dividend is as stable as they come.
Specifically, the bank’s highly diversified revenue stream and top-tier positioning in several different segments allow it to post strong numbers in all market environments.
Over the past 10 years, JP Morgan has posted annual revenue growth of 13%. More importantly, that has translated into average annual dividend growth of about 20% over the same time period.
JP Morgan shares currently trade near their 52-week highs. But they still sport a decent dividend yield of 2.4%, topping that of banking giant peers like Bank of America (2.0%) and Wells Fargo (1.7%).
Of course, if you're on the fence about the stock's valuation, some investing apps will give you a free share of JP Morgan just for signing up.
Private property opportunity
There you have it: three attractive dividend growth to consider for the long haul.
While skyrocketing meme stocks are making all the news today, creating a steadily growing income stream should be job one for conservative investors.
Of course, you don’t have to limit yourself to the stock market to do that.
For instance, this investing service makes it possible to lock in a steady rental income stream by investing in premium real estate properties — from commercial developments in LA to residential buildings in NYC.
You’ll gain exposure to high-end properties that big-time real estate moguls usually have access to, and you’ll receive regular payouts in the form of quarterly dividend distributions.