9 future dividend increases, including a king

September begins and this week, I will be presenting nine more dividend increases. Featured this week is dividend king Altria! Despite what you might think about their products, they are extending their 54-year growth streak with another 4% increase for investors. Furthermore, as we will see below, Amphenol is having phenomenal growth (yes, it’s legit). Finally, the overall group has an average increase of 11.7% and an average increase of 4.22%. This group is a scenario where a significant increase can skew the mean, while the median is significantly lower. Let’s go ahead and see if there are any interesting ideas here.

My investment strategy involves buying, holding and adding to companies that meet two criteria: consistently growing dividends and beating an equivalent benchmark. The information in this article is generated for my investment needs and I am happy to share it discoveries with my audience Seeking Alpha. This list can help you make wise investment choices and create a successful long-term portfolio.

I mention it every week, but I use my own research and don’t just write for pay or clicks. Unfortunately, many authors will cover a variety of stocks, even on the bull side, and never have a stake in them. Based on the research initiated here, I added Broadridge Financial Solutions (BR) to my dividend growth portfolio. A few weeks before, we also added Steris (STE).

How we created the lists

The following information is the result of merging two data sources: the “US Dividend Champions” spreadsheet from a certain website and future dividend data from NASDAQ. This process combines data on companies with a consistent history of dividend growth with future dividend payments. It’s important to understand that all of the companies on this list have consistently increased their dividends for at least five years.

Companies must have higher total annual dividends to be included in this list. Therefore, a company may not increase its dividend every calendar year, but the total annual dividend may still increase.

What is the ex-dividend date?

The ex-dividend date is when you must own shares to qualify for a future dividend or distribution. To be eligible, you must have bought the shares by the end of the previous business day. For example, if the ex-dividend date is Tuesday, you must have purchased the stock by the close of the market on Monday. If the ex-dividend date falls on a Monday (or a Tuesday following a Monday holiday), you must have bought the shares by the previous Friday.

Categories of dividends

Here are the definitions of the series categories as I will use them throughout the piece.

• King: over 50 years.
• Champion/Aristocrat: 25+ years.
• Contender: 10–24 years.
• Challenger: 5+ years.

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List of dividend increases

The dates are sorted by ex-dividend date (ascending) and then by series (descending):

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Field definitions

Streak: Years of dividend growth history are from the US Dividend Champions spreadsheet.

Forward yield: The payout ratio is calculated by dividing the new payout ratio by the current share price.

Ex-dividend date: This is the date you must own the stock.

Increase the Percentage: Percentage increase.

Streak category: This is the company’s global dividend classification.

Show me the money

Here is a table showing the new and old rates and the percentage increase. The table is sorted by ex-dividend day in ascending order and in descending order of the dividend series.

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Additional values

Some different metrics related to these companies include annual price action and P/E ratio. The table is sorted the same as the table above.

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Tickers by yield and growth rates

We’ve arranged the table in descending order so investors can prioritize current yield. As a bonus, the table also shows some historical dividend growth rates. Furthermore, we incorporated the “Chowder Rule”, which is the sum of the current yield and the five-year dividend growth rate.

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Historical returns

My investment approach involves identifying stocks that consistently outperform the market while increasing dividend payments. I use the Schwab US Dividend Equity ETF (SCHD) as a benchmark to measure performance. I use “Cohen & Steers REIT & Preferred Income Fund” (RNP) for REITs. I prefer to invest in an ETF if a stock cannot outperform its benchmark. SCHD has a solid track record of exceptional performance, offers a higher yield than the S&P 500, and has consistently grown its dividend. I have added many companies to my own portfolio based on this analysis (and further due diligence). I will also make timely acquisitions of existing holdings as well.

The ten-year dividend growth rate is one of the four main index drivers behind SCHD. It is an important factor in total return performance. Stock prices track strong dividend growth over long periods, and longer trends will cap short-term moves. These are total return figures, which include reinvested dividends.

The chart contains SCHD plus the nine companies with the highest 10-year dividend growth rates. Due to missing 10-year data, VICI and RICK are excluded. I might look at them separately, but they won’t be covered explicitly here.

This graph looks almost silly. Lam Research has blown the lid off the ball over the past decade, giving investors more than 10 bucks on their investment.

Lam completely overshadows everyone else, including Amphenol, with a whopping total return of 418%! In addition, Amphenol has a future dividend growth of 50%.

Overall, this was a great group of performers. Continuing in line, SYBT (275%), EFSC (241%) and FAF (218%) all beat SCHD (195%).

Unfortunately, our dividend king Altria underperformed with a total return of 130%. JJSF brought in behind the pack with a total return of just 98%.

Next steps

As an investor, I have high standards for the individual holdings in my portfolio. It’s not just about beating a certain benchmark by a small margin; I look for companies with a proven track record of exceptional past performance. I want to scrutinize their historical data to assess the likelihood of such performance continuing.

The only two on the list that interest me are LRCX and APH. I don’t own any of them, but simply based on their total returns, I’m immediately interested in learning more. From the statistics we shared, both had incredibly strong dividend growth rates. Here are those numbers again, just for those two.

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While the 46% 10-year growth rate for Lam is not sustainable, I am encouraged by the mid-digit growth rates for them over time. Amphenol also has a similar track record of delivering double-digit dividend growth rates for long periods of time. That said, last year’s growth was just 4.8%. I think the 50% increase this year more than made up for it. In any case, I plan to take a closer look at both companies this week and see if they fit in my portfolio.

Let me know what you think of my strategy and feel free to add yours in the comments below! As always, please do your due diligence before making any investment decisions.