BALTIMORE (Stockpickr) -- Trading days like yesterday are a good reminder of why investors turn to income when stocks are struggling. After all, a stock with a strong dividend yield can end up putting money in your pocket even when the market's crashing.
And with the
index falling 3.11% in Thursday's trading session -- the biggest single-day drop since last April -- dividend stocks looked even more significant.
At Stockpickr, we pay special attention to each week's dividend hikes, and for good reason: 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. Dividend increases are significant for any company and an even bigger deal in this economy, where management has to decide whether to prioritize balance sheet liquidity or sharing profits with shareholders.
Here's this week's round-up of recent
. These stocks represent some of the most interesting income investments on the market right now.
Industrial and medical gas supplier
increased its dividend by 22.2% to 22 cents per share last week, capping off the company's 30% rally in 2009.
Airgas, which operates more than 900 locations nationwide, holds more than 20% of the $11 billion packaged gas industry. Although Airgas's business has been hurt in the last few years by a contracting economy and struggling clients, the company's fundamentals remain strong going into 2010.
Airgas benefits from significant recurring revenues on the rentals of its 7 million gas cylinders - a relatively safe sales stream that should give investors some solace as the market continues to churn. With analysts overwhelmingly bullish on shares of Airgas, the company could pull out some solid outperformance on the S&P 500 in the next few months. The company's current dividend yield of 1.65% should give it some semblance of a head start.
One fund that's hoping for that scenario is the
(ACRNX), a fund with Morningstar's four-star rating. In addition to Airgas, the fund also owns shares of
Uniform rental giant
is another company that's doing a good job of profiting from a boring industry -- uniform rentals, entrance mats and restroom products.
But while the business might not be exciting, the dividend should be: Cintas increased its annual payout to shareholders to 48 cents per share, an industry-smashing 1.93% dividend yield.
Cintas benefits in a big way from its size. With 800,000 customers, the company has made a fortune by cross-selling its customers onto its other products and services. And although a slowdown in global markets have affected Cintas' sales, its margins are thick enough to withstand some dents and dings.
Or at least that's the position that the
is taking. Besides Cintas, Artisan owns stakes of
in its $5.3 billion portfolio.
operates more than 1,200 stores in the U.S. and Canada, catering to the formal men's apparel market.
And although the company has seen its sales slide amid tough employment numbers -- and fewer customers in need of new professional attire -- the company remains one of the biggest specialty retailers in the country, ready to bounce back alongside the economy.
But despite economic headwinds, the company has been sharing the wealth with investors, increasing its dividend 28.6% to 9 cents per share -- a 1.8% dividend yield.
One of Men's Wearhouse's biggest institutional owners is the
, which holds a four-star rating from Morningstar and owns positions in
. For the rest of this week's dividend stocks, check out the
portfolio on Stockpickr. And if you haven't already done so,
today to create your own dividend portfolio.
-- Written by Jonas Elmerraji in Baltimore.
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At the time of publication, author had no positions in stocks mentioned.
Jonas Elmerraji is the editor and portfolio manager of the Rhino Stock Report, a free investment advisory that returned 15% in 2008. He is a contributor to numerous financial outlets, including Forbes and Investopedia, and has been featured in Investor's Business Daily, in Consumer's Digest and on MSNBC.com.