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Sunday, January 30, 2011

7 Companies Increasing Dividends Last Week

It was another big week for income-oriented dividend stock investors, as a bevy of high-profile corporate names upped their payouts. Dividend stocks raising their yields include Intel (NASDAQ: INTC), Time Warner Cable Inc. (NYSE: TWC), Potash Corp. of Saskatchewan (NYSE: POT), Norfolk Southern Corp. (NYSE: NSC), Praxair Inc. (NYSE: PX), Parker Hannifin Corp. (NYSE: PH) and Limited Brands (NYSE: LTD).

Perhaps the biggest name on the list of dividend winners last week was semiconductor marker Intel (NASDAQ: INTC).  The chipmaker and tech bellwether boosted its dividend payments by the largest amount in five years while also adding $10 billion to its stock buy-back plans. The company raised its quarterly dividend to 18.12 cents per share, a 15% increase from the previous quarter. The additional $10 billion for share repurchases brings the overall buyback authorization to $14.2 billion. Intel said the dividend is payable March 1 to shareholders of record as of Feb. 7.

In addition to the big tech sector dividend bump, we also saw a spike in dividends from the entertainment sector. Cable TV provider Time Warner Cable Inc. (NYSE: TWC) raised its dividend last week, declaring a quarterly payout of 48 cents per share. That figure represents a 20% increase over its prior dividend. News of the dividend boost came as Time Warner Cable reported better-than-expected fourth-quarter earnings. The new payout from the second-largest U.S. cable-television operator will be handed out on March 15 to shareholders of record on Feb. 26.

Agriculture stars also shined this week, as fertilizer and feed products provider Potash Corp. of Saskatchewan (NYSE: POT) announced that its board of directors had approved a three-for-one stock split of its outstanding common shares. Under the terms of the deal, shareholders will receive two additional shares for each share owned as of Feb. 16. Now, in addition to the split, Potash made the deal even more interesting by increasing their quarterly cash dividend to 21 cents a share from 10 cents a share on a pre-split basis. The company also declared a quarterly cash dividend of 7 cents per common share on a post-split basis, which is payable May 5 to shareholders of record on April 14.
The transportation sector also saw representation in the array of companies raising dividends last week.

Railroad operator Norfolk Southern Corp. (NYSE: NSC) upped its quarterly dividend 11% to 40 cents a share from 36 a share. The dividend increase was the second since the transportation giant boosted its payout by 2 cents a share in July. This year’s dividend increase is nearly double the 6% dividend increase from Norfolk Southern in 2010. The increased dividend will be payable on March 10 to shareholders of record as of Feb. 4. One day after declaring the increased dividend, Norfolk Southern Corp. said its fourth quarter profit rose 31%. The strong performance of late in the railroad industry, including Norfolk Southern competitors CSX Corp. (NYSE: CSX) and Union Pacific Corp. (NYSE: UNP), bodes well for this traditionally strong dividend-paying sector.

Industrial gases firm Praxair Inc. (NYSE: PX) raised its dividend by 11% despite reporting fourth-quarter profit that fell 61% on tax charges. Charges aside, however, the company actually saw better-than-expected revenue from cost-cutting and growing sales in emerging markets. The global giant’s new dividend will be 50 cents per share, and it will be payable March 15 to shareholders of record as of March 7. Dividend increases are all too common for Praxair. The most recent bump is its 18th consecutive annual dividend increase.

Another global industrial powerhouse spreading the wealth to shareholders is Parker Hannifin Corp. (NYSE: PH). The company increased its quarterly cash dividend to 32 cents per share, payable on March 4 to shareholders of record as of Feb. 10. The new dividend represents a 10% increase over the previous quarterly dividend of 29 cents per common share. Although Parker Hannifin’s profit margins in the most recent quarter fell, the company — seen as a barometer for the entire global industrial segment — still managed to dish out the cash to investors.

Fashion retailer Limited Brands (NYSE: LTD) proved it can combine the concepts “sexy” and “dividends” with its latest announcement.  The company, which operates intimate apparel specialty store Victoria’s Secret as well as the Bath & Body Works and La Senza retail chains, said it was increasing its annual dividend by 20 cents to 80 cents per share. The first quarterly payment at the new rate will take place on March 11 to shareholders of record on Feb. 25. Now income investors can slip into something a little more comfortable that includes a sweet quarterly cash bonus.

Disclosure I am long  UNP, NSC, and INTC.

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