Dividend Growth Investor: Five Dividend Growth Stocks Increasing Shareholder Dividends

The market selloff peaked with a drop in dividend-paying companies. Given the competition between dividend yields and bond yields, that makes some sense. But over time, dividend companies can be a better investment than bonds.

That’s because many dividend companies can continue to grow their payout over time. It’s how company management signals that the business continues to grow. And that shareholders should be rewarded for their patience in holding.

Companies continue to increase their dividend payouts, even amid the recent market turmoil.

One company that sold off heavily in recent weeks is McDonald’s (MCD). The fast food operator and franchiser just increased its quarterly dividend by 10 percent to $1.67 per share.

Over the past decade, it’s raised dividends close to 7 percent annually. McDonald’s has now raised dividends every year since 1976, or 47 years. Today, shares yield about 2.7 percent.

Another company raising its dividend now is Lockheed Martin (LMT). The aerospace and defense contractor has raised its payout for 21 years now. Plus, the dividend has an average 10.6 percent increase annually over the past decade.

Currently, shares yield 3.1 percent.

The increased payouts over time mean that investors can fare better in these companies compared to investing in the fixed payout of a bond. And over time, higher dividend payouts tend to mean a higher share price as well.

Conversely, a bond is a fixed payment in, and a fixed payment back out at the end of its holding period.

To read the full list of companies raising dividends now, click here.