Based in Minneapolis, U.S. Bancorp operates in 25 states as a conventional retail and commercial bank -- but it's the firm's unconventional approach to revenues that makes it especially attractive right now. USB has focused on fee-based revenues, building out its wealth management, credit card servicing, and trustee businesses, three units that have contributed double-digit growth rates to USB's income statement. Fee-based revenues are generally recurring, and they tend to court stickier customers than traditional banking operations could hope to. In the low-rate environment we're in now, that's a big benefit for shareholders.
USB's financial health should be sufficient to sway regulators into letting the firm boost its dividend payout in the next quarter. Right now, the firm's yield weighs in at 2.33%.
Airgas (ARG - Get Report) is the world's largest industrial gas supplier, a business that doesn't sound particularly exciting. But ARG's performance has been exciting. Shares of the $7.6-billion firm are up more than 23% in the last year -- and that's after posting similar gain numbers in 2011 as well. But capital gains are only part of the overall picture; a hike to Airgas' 40-cent quarterly dividend could be in the cards for investors in the near-term too.Airgas supplies everyone from industrial manufacturers to hospitals with gases such as oxygen, nitrous oxide, and acetylene, and it has a smaller business selling hard goods hard goods such as welding equipment and eye protection. The gas business is attractive because it's got relatively high barriers to entry (bottling gas takes equipment and expertise), extremely low commodity costs, and a distribution system that's designed to generate especially high returns on investment for gas companies. As one of the few firms with the national scale to grab large national accounts, Airgas has an advantage over smaller competitors in this fragmented industry. And because gas tends to be a relatively small cost for ARG's customers, they're relatively insensitive to changes in gas prices, giving the firm attractive pricing power. Stellar customer stickiness rounds out the picture for this industrial supplier -- expect those fundamentals to spur a dividend hike on the horizon.