) -- It's earnings season -- and that means that investors are in store for some big dividend hikes this summer.
>>5 Must-See Charts to Buy in July
Dividends have kept climbing higher in 2013. In the last year,
companies have hiked their dividend payouts by more than 14%, ratcheting out their shareholder profit sharing to a new record high this quarter. And as earnings climb in kind, investors should expect more upside potential in the cash their portfolios generate.
So far, 77 S&P 500 constituents have reported their numbers to Wall Street this quarter, and on average, they've beaten estimates by 5%. That means that year-over-year, earnings are up a full 14% at this stage of the game. To be clear: That's breakneck fundamental growth for a broad market index.
>>Beat the S&P With 5 Stocks Wall Street Hates
With companies sitting on record corporate cash and profits right now, it's easier than it sounds to pick out names getting ready to hike their dividend payouts. In large part, it's because they have little choice. With lots of dry powder on corporate balance sheets and few options to generate meaningful internal returns, management teams who want to stay employed are returning cash to shareholders in record numbers. In recent months, we've had some stellar success in finding future dividend increases just by zeroing in on a few key factors.
Now we'll look at our crystal ball and try to do it again.
For our purposes, that "crystal ball" is composed of a few factors: namely a solid balance sheet, a low payout ratio, and a history of dividend hikes. While those items don't guarantee dividend announcements in the next month or three, they do dramatically increase the odds that management will hike their cash payouts, especially as investors start to get antsy about whether or not 2013's rally will be able to hang on.
>>5 Stocks Insiders Love Right Now
Without further ado, here's a look at
five stocks that could be about to increase their dividend payments
in the next quarter.