In this article, we discuss 10 companies that recently raised their dividends. You can skip our detailed discussion on dividend stocks, and go directly to read These 5 Companies Recently Increased Their Dividends.
In 2022, many companies raised their dividends steadily as their financial health recovered after the Covid-19 pandemic. Nearly 81% of the companies that issued payouts in the first quarter of 2022, raised their dividend year-over-year, as reported by Janus Henderson Group. For FY'22, FactSet estimates that dividend per share for the S&P 500 companies could represent an 8% year-over-year growth, compared with an early January forecast of 7% growth.
According to S&P Dow Jones Indices' latest report, annual dividend payouts achieved new records every year for the past decade, except for a decrease in payments in 2020. In the second quarter of 2022, dividend payments amounted to $140.6 billion, up from $123.4 billion during the same period last year. Dave Sekera, a market strategist at Morningstar, said that investors move towards dividend-paying companies as they offer higher levels of free cash flow, which generate passive income for investors. He further asserted that dividend stocks are valued more by investors this year due to rising interest rates, inflation, and fears of recession. Moreover, stocks that have a solid history of raising dividends like Merck & Co., Inc. (NYSE:MRK), Johnson & Johnson (NYSE:JNJ), and The Coca-Cola Company (NYSE:KO) are gaining ground among investors.
According to Janus Henderson, the growth in dividend payments is expected to continue for the rest of the fiscal year and estimates $1.54 trillion in global dividend payments at the end of the year, a 7.1% increase on an underlying basis. Considering this, we will discuss the companies that have recently increased their dividends.
For this list, we selected companies that increased their dividends in July 2022. The dividend yields for the below-mentioned stocks were considered as of July 21.
Latest Dividend Hikes to Watch
10. Landstar System, Inc. (NASDAQ:LSTR)
Dividend Yield as of July 21: 0.66%
Landstar System, Inc. (NASDAQ:LSTR) is a Florida-based transport company, that specializes in logistics and provides transportation management solutions.
At the end of Q2 2022, Landstar System, Inc. (NASDAQ:LSTR) reported total assets worth over $1.5 billion, down slightly from $1.52 billion in December 2021. The company's operating cash flow came in at $276.7 million in 2021, up from $210.7 million in 2020. On July 20, Landstar System, Inc. (NASDAQ:LSTR) raised its quarterly dividend by 20% to $0.30 per share. The dividend is payable on August 26, to shareholders of record on August 8. As of July 21, the stock's dividend yield was recorded at 0.66%.
In July, Evercore ISI lowered its price target on Landstar System, Inc. (NASDAQ:LSTR) to $161, with an In-Line rating on the shares, expecting a slower economic growth for the transportation sector.
At the end of Q1 2022, 22 hedge funds in Insider Monkey's database owned stakes in Landstar System, Inc. (NASDAQ:LSTR), down from 25 a quarter earlier. The combined value of these stakes is over $235.5 million. Among these hedge funds, AQR Capital Management was the company's largest shareholder at the end of March 2022.
In addition to famous dividend stocks, such as Merck & Co., Inc. (NYSE:MRK), Johnson & Johnson (NYSE:JNJ), and The Coca-Cola Company (NYSE:KO), Landstar System, Inc. (NASDAQ:LSTR) also offers stable dividends to shareholders.
Ensemble Capital mentioned Landstar System, Inc. (NASDAQ:LSTR) in its Q3 2021 investor letter. Here is what the firm has to say:
“Landstar: The global supply chain has been in the news a lot in the past eighteen months. In 2020, the threat of COVID and related lockdowns shuttered “non-essential” production. While most logistics companies were considered “essential,” they naturally scaled back as well. Layoffs or furloughs were common. Some cargo ships, planes, and trucks were temporarily taken off-line as the world sorted itself out.
And then just like that, the world economy came roaring back – and faster than expected. The American consumer in particular started spending and the global supply chain was not fully prepared for it. Dozens of cargo ships are currently stuck offshore waiting to unload at the port of Los Angeles, warehouses are full, trucks are hard to come by, and freight rates have surged higher due to the supply and demand imbalance. In a recent Financial Times article, the CEO of APM Terminals (a division of Maersk) said, “We need lower [consumer demand] growth to give the supply chain time to catch up, or differently spread out growth.” (Click here to see full text).
9. Greene County Bancorp, Inc. (NASDAQ:GCBC)
Dividend Yield as of July 21: 1.14%
Greene County Bancorp, Inc. (NASDAQ:GCBC) is an American bank holding company that provides full-service banking, including retail, commercial, and investment management.
At the end of Q1 2022, Greene County Bancorp, Inc. (NASDAQ:GCBC) reported $2.5 billion in total assets, up 14.6% from the same period last year. The company's cash and cash equivalents came in at $150.6 million at the end of the quarter, compared with $149 million in the prior-year period. Greene County Bancorp, Inc. (NASDAQ:GCBC) also holds a very strong dividend history, making dividend payments since 2000. The company also maintains an 8-year track record of consistent dividend growth. On July 20, it raised its quarterly payout by 7.7% to $0.14 per share. The dividend is payable on August 31, for shareholders of the company on August 15. As of July 21, the stock's dividend yield stood at 1.14%.
At the end of Q1 2022, 6 hedge funds held investments in Greene County Bancorp, Inc. (NASDAQ:GCBC), up from 1 in the previous quarter. The combined value of these investments stood at roughly $3.5 million.
8. EQT Corporation (NYSE:EQT)
Dividend Yield as of July 21: 1.20%
EQT Corporation (NYSE:EQT) is a Pennsylvania-based energy company that specializes in the exploration of hydrocarbon and pipeline transport.
In Q1 2022, EQT Corporation (NYSE:EQT) generated $580 million in free cash flows, up from $259 million during the same period last year. It returned $816 million in shareholder buybacks and dividends during the quarter. For FY22, the company expects its free cash flow to reach $2.35 billion, indicating future dividend payments. EQT Corporation (NYSE:EQT) froze its dividends in 2020 due to the pandemic and reinstated its payouts in February 2022. The company raised its quarterly dividend by 20% on July 20 to $0.15 per share. The stock's dividend yield was recorded at 1.20% on July 21.
In July, Citigroup appreciated the scale and operational efficiency gains of EQT Corporation (NYSE:EQT) and assumed its coverage on the stock with a Buy rating and a $48 price target.
Dan Loeb's Third Point owned nearly 9 million shares in EQT Corporation (NYSE:EQT), becoming the company's largest shareholder in Q1 2022. Overall, 52 hedge funds in Insider Monkey's database owned stakes in the company in Q1, up from 46 a quarter earlier. These stakes are collectively valued at over $2.1 billion.
“In the early days of the invasion, we made two measured changes to the portfolio based on the longer-term fallout we anticipate from Russia’s invasion of Ukraine. First, we initiated small positions in U.S. natural gas producer EQT (NYSE:EQT).
Given its superior environmental profile compared to other fossil fuels, we have long favored natural gas in our energy holdings. Combustion of natural gas releases 50% less CO2 than coal, 25% less CO2 than gasoline and dramatically less particulate and pollution, per the U.S. Energy Information Administration. With the advances in shale production this century, the U.S. has become a natural gas powerhouse with some of the lowest-cost and largest reserves in the world. But because natural gas is difficult to ship across the ocean (it must be liquefied, which requires expensive infrastructure on both ends of the voyage), America’s gas bounty has ironically proved a burden for U.S. producers. (Click here to see full text)
7. Scholastic Corporation (NASDAQ:SCHL)
Dividend Yield as of July 21: 1.65%
Scholastic Corporation (NASDAQ:SCHL) is a New York-based multinational publishing company that publishes and distributes comics, books, and educational materials for institutions. The company's products are distributed via retail and online sales.
In fiscal Q3 2022, Scholastic Corporation (NASDAQ:SCHL) generated $23.4 million in free cash flow, up from $5.5 million in the same period last year. The company distributed $5.2 million in dividends during the quarter, up from $5.1 million in the previous quarter. On July 20, Scholastic Corporation (NASDAQ:SCHL) raised its quarterly dividend by 33% to $0.20 per share. This was the company's first dividend raise since 2013. The dividend is payable on September 15, for shareholders of record on August 31. As of July 21, the stock's dividend yield came in at 1.65%.
The number of hedge funds tracked by Insider Monkey owning stakes in Scholastic Corporation (NASDAQ:SCHL) stood at 16 at the end of March 2022, up from 12 funds in the previous quarter. These stakes hold a consolidated value of $45.8 million.
6. PPG Industries, Inc. (NYSE:PPG)
Dividend Yield as of July 21: 1.94%
PPG Industries, Inc. (NYSE:PPG) manufactures and supplies paints, coatings, and specialty materials. The company operates in over 70 countries around the globe.
At the end of Q1 2022, PPG Industries, Inc. (NYSE:PPG) had cash and short-term investments amounting to $1 billion, with total assets standing at $7.6 billion. The company paid $139 million in dividends to shareholders, up from $128 million in the previous quarter. On July 21, PPG Industries, Inc. (NYSE:PPG) hiked its quarterly dividend by 5% to $0.62 per share. The company maintains a 51-year track record of dividend growth, falling into the category of Dividend Kings. The stock's dividend yield stood at 1.94%, as of July 21.
In June, Vertical Research upgraded PPG Industries, Inc. (NYSE:PPG) to Buy from Hold, with a $139 price target, appreciating the stock’s compelling value. In addition to this, BofA also has a Buy rating on the stock in July.
At the end of March 2022, 33 hedge funds in Insider Monkey's database owned stakes in PPG Industries, Inc. (NYSE:PPG), valued at $441.3 million. In the previous quarter, 34 hedge funds held positions in the company, with stakes worth nearly $500 million. First Eagle Investment Management was the company’s leading shareholder at the end of Q1.
Like Merck & Co., Inc. (NYSE:MRK), Johnson & Johnson (NYSE:JNJ), and The Coca-Cola Company (NYSE:KO), analysts and investors are also favoring PPG in the current market downturn.
“While commodities-exposed areas of the materials sector such as mining and steel fared well in the quarter, we tend to have less direct exposure to commodities across our portfolio. Holdings like paint and coating company PPG Industries (NYSE:PPG) that use natural gas and oil related products as feedstock into their products faced sharp input cost escalation, driving meaningful margin compression, which was not well-received by investors. While negative in the short term, we remain confident that the company will be able to adjust pricing accordingly and recover margins over the medium term.”
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Disclosure. None. These 10 Companies Recently Increased Their Dividends is originally published on Insider Monkey.