5 Industrial Stocks Poised for Bigger Dividends

BALTIMORE ( Stockpickr) -- These five industrial stocks are getting ready to raise dividends -- they just don't know it yet.

Industrials have been getting a bad rap lately, as investors ramp up their anxiety over Europe and expect the worst from industrial production. But that extreme negative sentiment may be overdoing it a bit. While it's true that industrials have to deal with cyclical businesses, it's important to remember that industrial firms are still churning out record revenues right now. And when price and value don't match up, heftier dividend payouts are the best way for management to reward shareholders.

All in, industrials tend to get a bad rap from retail investors. After all, industrial manufacturing isn't as exciting as the next tech breakthrough or some hot consumer product. Even so, investors shouldn't eschew the boring stocks in 2012. I can name more than a few times when buying boring turned out to be a good move, especially when sentiment was pointed the other way.

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That's why we're searching out a handful of industrial names that I think are set to hike their dividend payouts in the next quarter.

For our purposes, our "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 two, they do dramatically increase the odds that management will hike their cash payouts, especially as investors start to get antsy about stock performance in 2012.

In other words, fundamentally solid companies realize that they need to hike returns for shareholders if they want to keep demand for their stock high. And studies show that, historically, a dividend-centric strategy from management means much bigger returns for your portfolio.

Without further ado, here's a look at five industrial stocks that could be about to increase their dividend payments in the next quarter.

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