Close

Three Companies That Are Likely to Raise Their Dividend Before Christmas

December 2, 2015 11:22 AM EST

COMING SOON: StreetInsider.com's Dividend Insider Elite: Stay Ahead of the Pack on Upcoming Dividend Hikes and Discovery Dividend Stock Gems. Get the inaugural edition FREE. Sign-Up Here.


In flat markets, returning capital to shareholders in the form of dividends becomes more important than ever. We've identified three companies have shown the willingness to increase payouts by their the track records and have the financial ability to continue the trend. If history holds as a guide, these companies (DIS, EMN and CUBE) could be announcing dividend increases in the next few weeks.

Disney (NYSE: DIS): On June 24th, the Walt Disney Company began paying semiannual dividends and announced an 1H15 dividend of $0.66 cents which implied a 15% increase to the annual dividend. However, for the last 6 consecutive years, the company has raised its dividend between December 5th and 15th and with expectations for the Force Awakens now ratcheting up from the $500 million level to $1 billion for domestic box office receipts analysts are beginning to hint at 35% EPS upside from current levels making a 15% dividend increase seem meager. The company currently pays out $1.32 annualized, which gives it a yield of 1.2%

Eastman Chemical (NYSE: EMN): Eastman Chemical has increased its dividend for five consecutive years, with the announcements usually in early-to-mid December. The company current pays out $1.60/share on an annualized basis, which gives it a yield of 2.2%. The company has been raising its dividend in the 14-17% range.

CubeSmart (NYSE: CUBE): Cubesmart has increased its dividend in each of the last 5 years, typically in mid-to-late December. The company competes in self storage and has seen Net Operating Income grow at 9% this year. The dividend yield is currently 2.2% but if the company increased its payout ratio to be more in line with the industry, it could jump up to 3.5%. Last year the company raised its dividend 23% on December 16th.

Dividend increases show managements confidence in both near and long term business prospects. Whether you trade around the events, monetize the event by selling puts or simply use the event as a way to build out your buy list, you can reduce risk in uncertain times by focusing on stocks with a shareholder friendly capital return policy.

By David Eller



Serious News for Serious Traders! Try StreetInsider.com Premium Free!

You May Also Be Interested In





Related Categories

Dividend Hike, Dividends

Related Entities

Dividend