BALTIMORE (Stockpickr) -- There's no question that 2015 has been a market where every basis point counts -- but have you been paying attention to where the gains are coming from? Year-to-date, more than a quarter of the S&P 500's total returns haven't come from capital gains at all.
Instead, that big chunk of market performance has been paid out in the form of dividends.
The important takeaway? Ignore dividend stocks at your own peril in 2015.
The good news is that it's becoming easier than ever to grab onto big dividend payouts in your portfolio. Total dividend payouts are currently at record highs and rising. And with corporate cash sitting at a record high $1.33 trillion, you can bet that U.S. firms are going to be giving shareholders an even bigger piece of that huge reserve. To find the biggest benefit from dividends, it's not enough to simply buy names with big payouts today. You've got to think about which names are going to be paying more tomorrow too.
So instead of chasing yield, we'll try to step in front of the next round of stock payout hikes.
For our purposes, that "crystal ball" is composed of a few factors: namely a solid balance sheet, 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 to shareholders. And they've helped us grab onto dividend hikes with a high success rate in the past.
Without further ado, here's a look at five big stocks that could be about to increase their dividend payments in the next quarter. Think of it as your dividend preview.
Up first is admittedly a bit of a "gimme." Walt Disney (DIS) has hiked its dividend payout every year since 2009, and it looks likely to do the same in the second half of this year too. Right now, the firm pays a $1.15 annual dividend that translates to a 1.04% dividend yield. Disney may not be an "income stock" by most investors' yardsticks, but it has been growing its payout consistently. If you'd bought DIS back in mid-2010, you'd actually be seeing a 3.2% yield on cost at current price levels.
Disney is more than just Mickey Mouse and his friends. The cartoon mouse is certainly a major piece of the empire, but TV networks are the real cash cow here. That's because about half of Disney's profits actually come from TV networks. As far as networks go, ESPN is the star attraction. After all, it generates the highest per-subscriber affiliate fees of any cable channel, and it hits a coveted advertising demographic. That one-two punch at ESPN has given the rest of Disney's empire a chance to catch up in recent years.
Outside of TV, Disney owns substantial capital-intense businesses, such as a movie studio, theme parks and a cruise line. While those were drags on overall performance previously, they've been providing attractive returns thanks to hit films and an economic engine that's firing on all cylinders again. Expect Disney to continue to successfully leverage its phenomenal intellectual property portfolio across its businesses in 2015.