Dividend-Boosting Stocks for the Week

These companies, including Home Depot and Altria, recently raised their dividends.

Author:: Jonas Elmerraji
Publish date:: Mar 5, 2010 12:26 PM EST

BALTIMORE (Stockpickr) -- This past week has been a strong one for stocks -- finally. The market has seen moderate positive action for the last five consecutive trading days, pushing the S&P 500 index up 1.7% for the first week of March. But there's even more bullish sentiment to be found in the world of dividend stocks.

Last week marked a record for dividend increase announcements: 35 stocks increased their payouts to shareholders last week, besting the first week of February's 29-stock ramp up. That uptick in dividend activity bodes well for the market; after all, it takes a company with strong financial health to part with liquidity right now.

But dividend increases are even more significant than that. Historically, companies that pay higher dividends materially outperform those that don't, and when the market turns bearish, dividends could be the only semblance of return that investors see for a while.

Here's this week's round-up of recent

dividend-increasers

. These stocks represent some of the most interesting income investments on the market right now.

Virginia-based tobacco giant

Altria

(MO) - Get Report

increased its dividend 2.9% last week to 35 cents per share, bringing the company's annual dividend yield to a sizable 6.86%. Altria's had a strong run in the last year and change, with shares rising 35% since the first trading days of 2009. The company's leading market share and strong recurring sales numbers could push shares even higher in 2010, bolstered by a dividend that's hard for income investors to ignore.

Like many so-called "sin stocks," Altria fared relatively well during the recession as consumers upped their tobacco intake to relive the stress of a tough economy. That performance came in spite of government excise tax hikes that threatened to test the company's ability to cope with price volatility. Expect performance to continue on its path this year.

One fund that's hoping that's the case is the

Fifth Third Disciplined Large-Cap Institutional Fund

(FEINX), a fund that holds Morningstar's three-star rating and holds shares of

ConocoPhillips

(COP) - Get Report

and

Verizon

(VZ) - Get Report

in its concentrated equity portfolio.

It's been a good decade for investment manager

BlackRock

(BLK) - Get Report

. Since the company went public back in 1999, it's rocketed from a mid-sized niche firm to the largest asset manager in the world with more than $3.2 trillion in client cash under its guidance. BlackRock increased its dividend 28.2% last week to $1 per share.

BlackRock's biggest shareholders are some of the biggest retail banks in the world -- relationships that should expose the firm to additional growth this year regardless of the firm's size. But not all of the company's stakeholders are banks.

Highfields Capital Management

is a $6.7 billion hedge fund sponsor that's one of BlackRock's biggest owners. In addition to the Boston-based fund's stake in BlackRock, the fund owns stakes in

ExxonMobil

(XOM) - Get Report

and

Motorola

(MOT)

Home Depot

(HD) - Get Report

has made an 8.7% dash this year, sparked in part by a strong showing in the company's fourth quarter numbers last week - and by the company's 5% dividend increase that sent the company's shareholder payouts to 23.62 cents per share.

Although Home Depot's core business was struck hard in the recession as home improvement budgets evaporated, the company worked hard to brand itself as an inexpensive home improvement alternative in the last 18 months. That gamble has paid off, keeping the company in the black while competitors felt the squeeze.

Home Depot is one of the key holdings in the

T. Rowe Price Equity Income Fund

(PRFDX), a four-star fund managed by veteran Brian Rogers. Among the fund's holdings are

American Express

(AMX) - Get Report

and

AT&T

(T) - Get Report

For the rest of this week's dividend stocks, check out the

Dividend Stocks portfolio

on Stockpickr.

And if you haven't already done so,