High yield dividend stocks continue to be in favor with investors, as we brace for the pending inflation and shake-up in bonds that is sure to come from a weak dollar in the wake of the Fed’s newest round of “quantitative easing.” Income investors who are wise not only get the decent 3% or 4% payback from dividend picks, but also a nice bit of share appreciation.
Last week there were a boatload of dividend increases to note – and I covered a lot of ground in my roundup of 15 stocks raising dividends. The list this week is a bit shorter as we move out of the heart of earnings season and into the lazy days before the holidays, but there are some big names this week boosting dividends nonetheless – including tech powerhouse Intel (NASDAQ: INTC) and German industrial stock Siemens (NYSE: SI).
Let’s take a look at six recent dividend increases from companies of note:
Intel Dividend
Intel Corp. (NASDAQ: INTC), the world’s biggest computer chipmaker, hiked its dividend by 14% from 15.75 cents to 18 cents a share. INTC stock now has a dividend yield of about 3.3%. The dividend will be payable next quarter to Intel shareholders.
Intel is coming off two straight years of sales declines, but is still seeing strength in emerging market sales. There have also been improving EPS for each of the last four Intel quarterly earnings reports. The fact that this 2010 dividend increase is larger than last year’s boost of 13% could be a bullish sign.
Looking forward, Intel sales this quarter are projected to increase to $11.0 billion to $11.8 billion, above the $11.3 billion Wall Street forecast. The company has lagged the broader market in 2010 but perhaps could be turning around. It is up +10% since Sept. 1, rallying with the rest of the tech sector.
Siemens Dividend
German industrial conglomerate Siemens (NYSE: SI) unveiled a stunning dividend increase on Thursday of about 69% to about $3.71 a share. The company also made waves by promising that going forward, the dividend will also be based on a pay-out ratio of 30-50% of net income.
The announcement came alongside strong earnings for Siemens, including a 25% in new orders for the third quarter. SI stock has soared since Sept 1., adding +30%, after a relatively lackluster 2010 before that.
As for the new Siemens dividend, it is an annual payout will equal a 3.3% yield at current valuations. The new dividend will be issued Feb. 3 to shareholders of record Jan. 26.
Sysco Dividend
Sysco Corp. (NYSE: SYY), the blue chip food service company, announced a 4% increase in its dividend recently – upping the 25 cent quarterly payday by a penny to 26 cents. That gives the company’s dividend yield a small bump to 3.5%. The new dividend is payable Jan. 28 to shareholders of record Jan. 7.
Sysco tallied smaller earnings but better sales in its latest quarter. Some experts are blaming commodity price increases, including nearly 10% inflation in the combined categories of meat, dairy, and seafood.
Sysco has had a pretty ho-hum 2011, lagging the market with only a few percentage points of profit in shares. SYY stock is sitting right in the middle of its 52-week range of $26.50 to $31.99.
DeVry Dividend
Retraining and education giant DeVry Inc. (NYSE: DV) was brutalized this summer with other for-profit ed stocks. DV stock is -18% year-to-date, though it has rebounded slightly from August lows.
Still, investors may take heart in a decent dividend increase and more buybacks from DeVry. Recently, the company boosted its semi-annual payout 20% — from 10 cents to 12 cents – payable Jan. 10 to shareholders as of Dec. 10. The boost gives Devry a new yield of about 0.5%. Also, the company announced plans to repurchase an additional $50 million in shares after completing its current $50 million buyback.
Tennant Dividend
The Tennant Company (NYSE: TNC), a small cap cleaner and protectant manufacturer, now offers a plump 3% dividend yield thanks to a 21% increase in its payout this week. Tennant is raising its quarterly payout to 17 cents from 14 cents. The dividend is payable Dec. 15 to shareholders of record on Nov. 30. The company has increased its annual cash dividend payout for 39 consecutive years.
Tennant has outperformed the market nicely in 2010, up about +33% year-to-date, though it’s been pretty slow going lately and most of those gains came early in the year. The company just raised its full-year guidance, however, so could be ready for another leg up.
Timken Dividend
Ohio-based industrial mid-cap Timken Company (NYSE: TKR) has been booming so far this year, with gains of +80% year-to-date and about +70% gains since a July low. The company is looking to share some of that success with shareholders via a 38% boost in its quarterly dividend. Specifically, Timken will hike its payday from 13 cents a share to 18 cents. The new dividend is payable Dec. 2 to shareholders of record Nov. 22.
Timken may not be a world famous dividend stock, with a new yield of about 1.7%. However the December payment will be the 354th consecutive dividend paid on the common stock, dating back to 1922. And after an impressive run in 2010, investors may start to see the appeal of TKR.
Jeff Reeves is editor of InvestorPlace.com. As of this writing, he did not own a position in any of the stocks named here. Follow him on Twitter at http://twitter.com/JeffReevesIP.
