5 Dividend Hikes to Watch for This Earnings Season

Deere

2013 is already shaping up to be a good year for shares of Deere (DE) -- the $34 billion agricultural and construction equipment manufacturer has already seen its share price rally by 4% and change. That's almost half of the performance this stock saw in the entire last year.

A dividend hike could help to add onto those returns; right now, Deere pays a 46-cent quarterly dividend for a 2.05% yield.

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Deere's brand is a big asset. It's the only combine maker I'm aware of that gets away with selling apparel to suburbanites -- and more important, that brand strength carries over to its core market too. Deere has built a reputation for quality and technology, pioneering features like GPS marking of fields in its equipment. That helps Deere command higher prices than peers while still actually moving equipment. And there's no question that Deere does, in fact, move equipment; the firm owns more than 50% of the North American ag market.

A big asset for Deere is its captive finance arm. While that scared off some investors in 2008, the quality of Deere's debt has held up better than most analysts expected -- and with access to extremely cheap capital right now, Deere Financial should help stoke the growth fires in a big way going forward. With ample liquidity on hand, Deere looks well positioned for a dividend hike in the next quarter. Investors should watch out for first quarter earnings on Feb. 13.

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