Buy General Mills for the Dividend, Keep It for the Evolution

 NEW YORK (TheStreet) -- Shares of packaged foods company General Mills (GIS) are scheduled to go ex-dividend Wednesday. To qualify for a dividend check, investors must own GIS stock prior to Friday (the date of record), which means if you want to play the strategy known as "dividend capture," the time to act is now.

Dividend capture consists of buying stocks for the sole purpose of collecting their quarterly dividends, and then selling them within days after the cash has been paid out by the company. In this case, General Mills is scheduled to pay its 44-cent quarterly dividend on Aug. 3, which is roughly three weeks from the date of record on July 10 --  the day the company will finalize its shareholder roster, locking down the list of people to whom it will send dividend checks.

Whether in bear or bull markets, dividend capture, also known as "buying dividend," can be a lucrative strategy -- one that mitigates the risk associated with holding stocks for the long term. For General Mills, however, investing for the long term can be rewarding too. Not only does its dividend yield 3.10% annually (above the 2.00% market average), the Minneapolis-based company has raised its dividend almost 60% in the past four years.

GIS Chart
GIS data by YCharts

Known for cereals like Cheerios and Lucky Charms, Häagen Dazs ice cream, Yoplait yogurt and a host of other ready-to-eat foods, General Mills is working to re-invent itself by launching dozens of new products that it hopes will spark higher sales in the quarters ahead. At the same time, General Mills, which last year picked off organic and natural food specialist Annie's, is ramping up its high-growth high margin organic foods category, which helps it to better compete with the likes of Kraft (KRFT) and Kellogg (K).

If you liked this article you might like

It's Decision Time for the Fed in the Week Ahead

Fight Off Complacency: Cramer's 'Mad Money' Recap (Fri 9/15/17)

Jim Cramer Calls for Firing of Equifax CEO Richard Smith; Challenges Board

Hurricane Irma, a Debt Deal and Disney Cause Wall Street Waves

Hurricane Irma Bears Down on Equities and Disney Slide Hits Dow