Corporate America continues its dividend bonanza, as last week brought out a plethora of high-profile companies increasing their payouts. Atop the list of dividend stars dolling out more cash was United Parcel Service, Inc. (NYSE: UPS). The ubiquitous package delivery firm delivered an 11% increase in its quarterly payout to shareholders. The company also predicted strong cash flow for the full year in what can be read as a clear signal that confidence in the economic recovery is increasing.
In a statement following UPS’s stellar fourth-quarter earnings release, Chief Executive Officer Scott Davis said, “We believe that 2011 is going to be a great year for UPS and we’re committed to significantly increasing distributions to share owners.” That’s excellent news for income hounds, and considering UPS is thought of as a barometer for the economy’s health, it’s also good news for the country. UPS said it will boost quarterly cash payments to 52 cents per share from 47 cents per share. The dividend will be payable March 2 to investors of record on Feb. 14.
Insurer Hartford Financial Services Group (NYSE: HIG) joined the dividend parade last week, as the company raised its dividend for the first time since 2007. The company doubled its quarterly payout to 10 cents per share, payable to shareholders of record on March 1. News of the payout increase came along with the company’s better-than-expected fourth-quarter profit of $1.06 per share, which topped the consensus Wall Street estimate of 99 cents per share. The upbeat dividend hike in HIG is a welcome development as well as a stark contrast to two years ago when the company slashed its dividend 84% to the current 5 cents per share.
The insurance sector saw another high-profile dividend increase, this time from health insurance giant Aetna Inc. (NYSE: AET). The company made a big time increase in its payout to shareholders, bringing the quarterly dividend to 15 cents per share from the current payout of 4 cents per share. The new dividend will be paid on Apr. 28 to shareholders of record as of Apr. 14. Along with the dividend bump, Aetna said its fourth-quarter profit increased by a healthy 30% over the same period a year ago.
Big tech had big news on the dividend front this week, as wireless chipmaker Broadcom Corporation (NASDAQ: BRCM) announced a 12.5% increase in its quarterly cash dividend to 9 cents a share. The company also announced plans to buy back some $300 million in stock. The new dividend will be paid March 7 to stockholders of record as of Feb. 18. The dividend increase was accompanied by fourth-quarter earnings that met expectations; however, its forecast was a bit lower than analysts had anticipated. The stock sold off sharply on the news in Wednesday trade.
Perhaps the most hated oil company on the planet is BP plc (NYSE: BP), and that’s understandable after the way BP executives handled last year’s sickening oil spill in the Gulf of Mexico. Yet despite that spill fiasco, the company reported a fourth-quarter profit that was 30% higher than the same quarter last year. More importantly for dividend hounds, BP announced the resumption of its dividend payouts for the first time since early 2010. BP’s board declared a quarterly dividend of 7 cents per share, and though that’s half of what it was paying out before it suspended dividends after the oil spill, the news is definitely welcome for income investors.
Avery Dennison Corp. (NYSE: AVY) makes adhesives for everything from beverage labels to apparel tags and road signs. That’s a sticky business, but last week the company wasn’t too sticky with its dividend. Management approved a 25% dividend increase to 25 cents per share from 20 cents, payable March 16 to shareholders of record on March 2. News of the loosened dividend payout came along with news of a near doubling in fourth-quarter profits.
Candy maker The Hershey Company (NYSE: HSY) reported a tasty 7% profit increase during the fourth quarter, which it achieved on higher sales. The food giant decided to provide a sweet treat to shareholders too, as the company raised its quarterly dividend by 2.5%. The new dividend, payable to shareholders of record on Mar. 15, will be 34.5 cents per share.
Recently, Time Warner Cable Inc. (NYSE: TWC) raised its quarterly payout, and last week it was the media giants turn. Time Warner Inc. (NYSE: TWX) saw better-than-expected earnings during the fourth quarter, and that prompted the company to forecast strong 2011 earnings. It also allowed executives to announce an 11% hike in the quarterly dividend. The new dividend will be 23.5 cents per share, which will be payable on March 15 to stockholders of record as of Feb. 28.
At the time of publication, Jim Woods held no positions in any of the stocks mentioned in this article.
