7 Dividend Stocks That Want to Pay You More Cash
BALTIMORE (Stockpickr) -- Could dividends be in a bubble?
That's the argument that's been popping up in the headlines more and more in the past couple of months. The idea that dividends could be facing a bubble is a scary one. After all, these are the names that risk-conscious investors normally turn to avoid speculative forces, not to exploit them. But all of the dividend bubble talk warrants a quick look at what's really going on in dividends right now.
Bubbles can happen anywhere. They're all about insane valuations. So do dividends look like they're entering bubble territory?
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Not quite. While dividend payers have been moving higher in 2012, so has everything else, buoyed by strong earnings season performance and already discounted values. More significant, corporate profits and cash reserves (two of the biggest factors behind dividend payouts) both currently sit at all-time highs. If anything, dividend stocks are getting cheaper; in the last year, the S&P 500 has moved 4% higher -- but the S&P's dividend yield has moved more than 16% higher. So in reality, the bubble argument looks pretty weak. But dividend stocks don't. Historically, their payouts account for the lion's share of investors' returns. That's why we're taking a closer look at seven dividend stocks raising their payouts right now. Over the last 36 years, dividend stocks have outperformed the rest of the S&P 500 by 2.5% annually, and they outperformed nonpayers by nearly 8% every year, all while paying out cash to their shareholders, according to data compiled by Ned Davis Research. The numbers are even more compelling when looking at companies that consistently increase their payouts. That's why we pay close attention to the firms that are shoveling more corporate cash to shareholders each week. With that, here's a look at seven of the stocks that hiked payouts in the last week.![]() |
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