Tuesday, November 23, 2021

Expected Dividend Increases for December 2021

As I'm writing this blog post, Thanksgiving Day is right around the corner. The wind chill is in the mid-20s and it's snowing as I'm writing. So much for no snow cover on Thanksgiving like we had a few years ago here in Central Wisconsin.

With that aside, I will discuss the dividend increases that I have received to date. Of note, I'm still expecting a dividend increase from MRK any day now. Thus, I'll be updating this blog post whenever that raise is announced. I'll also be looking ahead to the multitude of dividend increases that I'm expecting next month, which will be the busiest month of this year for raises!

 

Actual Dividend Increases for November 2021

Dividend Increase #1: Simon Property Group (SPG)

The mall, outlet center, and lifestyle center REIT Simon Property Group announced a 10% increase in its quarterly dividend from $1.50 per share to $1.65 per share. SPG's strong recovery from COVID-related headwinds this year is what prompted the stock to raise its dividend for the third time this year. And at the rate the stock is going with its dividend increases, my prediction is that the quarterly dividend could be restored to its pre-COVID level of $2.10 per share potentially by the end of next year.

Across my six shares of SPG, my net annual forward dividends shot $3.60 higher due to the recent dividend increase.

Dividend Increase #2: Main Street Capital (MAIN)

Business development company Main Street Capital declared a 2.4% increase in its monthly dividend from $0.21 per share to $0.215 per share. Like SPG, MAIN has done well operationally due to the economic recovery over the past year-plus. Since MAIN already raised its dividend by 2.4% in August, this is the second raise of the year for shareholders. On top of the increase in the regular dividend, MAIN announced a $0.10 per share supplemental dividend for shareholders to be paid in December of this year.

This announcement boosted my net annual forward dividends by $0.96 across my 16 shares (at the time of the raise as I purchased more a couple of weeks after the dividend increase).

Dividend Increase #3: Pinnacle West Capital (PNW)

Despite the recent decision from the Arizona Corporation Commission (ACC) to cut Pinnacle West Capital's return on equity from 10% to the lowest in the nation among mid to large sized utilities in the U.S. at 8.7%, PNW opted to increase its quarterly dividend by 2.4% from $0.83 per share to $0.85 per share. 

This came in a bit below my revised estimate of a 3.6% increase in the quarterly dividend per share to $0.86, but I'll gladly take this raise from PNW considering the circumstances. 

Across my seven shares of PNW, my net annual forward dividends increased by $0.56 due to the dividend increase.

Dividend Increase #4: Aflac (AFL)

Supplemental insurer Aflac announced a 21.2% increase in its quarterly dividend from $0.33 per share to $0.40 per share. In light of AFL's solid fundamentals and low payout ratio, I'm pleased with the board of directors' decision to hand out a massive dividend hike to shareholders.

This dividend raise boosted my net annual forward dividends by $3.08 across my 11 shares of the stock.

Dividend Increase #5: Realty Income (O)

The single-tenant triple net lease REIT Realty Income declared a 4.2% increase in its monthly dividend from $0.236 per share to $0.246 per share, which like many of the other dividend increases was one that came by surprise in November. But since O's acquisition of VEREIT that recently closed is expected to be more than 10% accretive to its AFFO per share, O is easily able to afford such a dividend increase.

Across my 13 shares of the stock, my net annual forward dividends rose by $1.56 as a result of the dividend bump.

Dividend Increase #6: KeyCorp (KEY)

The Ohio-based regional bank KeyCorp raised its quarterly dividend by 5.4% from $0.185 per share to $0.195 per share, which came in below my expectations considering that this was the first raise from KEY since the onset of COVID. I was expecting a 10.8% increase in the quarterly dividend to $0.205 per share.

But at any rate, I'll gladly take a 5.4% increase from KEY. I'd rather a company be conservative with its dividend increases than overextend itself and eventually have to cut the dividend.

The dividend increase from KEY resulted in an $0.88 climb in my net annual forward dividends across my 22 shares of the stock.

Pending Increase: Merck (MRK)

The one dividend increase that I am still expecting this month that I haven't yet received is from none other than the Big Pharma stock Merck. I'm still anticipating that MRK will announce a 9.2% increase in its quarterly dividend from $0.65 per share to $0.71 per share.

If this dividend increase plays out as I expect, my net annual forward dividends would surge $1.92 across my eight shares of MRK stock.

Expected Dividend Increases for December 2021

Expected Dividend Increase #1: Realty Income (O)

Another dividend increase from O may seem like it's out of the question since it just upped its dividend by quite a bit. But since the increase that us shareholders recently received was the big one for the year and the stock raises its dividend four times a year by smaller amounts, there is still a potential December increase left before the calendar turns to 2022.

Therefore, I'm expecting that O will inch its monthly dividend 0.2% higher from $0.246 per share to $0.2465 per share next month.

Across my 13 shares of O stock, my net annual forward dividends would edge $0.078 higher as a result of such dividend increase.

Expected Dividend Increase #2: W.P. Carey (WPC)

Like O, W.P. Carey is a diversified REIT that raises its dividend in smaller amounts quarter in and quarter out. As the stock gradually divests itself of its investment management business and becomes a pure play REIT, this should help dividend increases to accelerate.

But in the meantime, I'm forecasting that WPC will announce a 0.2% increase in its quarterly dividend from $1.052 per share to $1.054 per share next month.

My net annual forward dividends would grow by $0.056 across my seven shares of the stock if this dividend raise occurs.

Expected Dividend Increase #3: Amgen (AMGN)

The first Big Pharma stock that I'm expecting a dividend increase from in December is Amgen. Because analysts are projecting that AMGN will grow its EPS 7.4% next year to $18.13, I believe that a high-single-digit increase in the quarterly dividend is realistic. That's why I believe AMGN will announce an 8% increase in the quarterly dividend from $1.76 per share to $1.90 per share.

Across my four shares of AMGN stock, this would boost my net annual forward dividends by $2.24 if my prediction is correct.

Dividend Increase #4: Eastman Chemical (EMN)

Advanced materials and specialty additives company Eastman Chemical is next on my list for December dividend increases. Since analysts are forecasting the stock will produce 6.9% growth in its EPS to $9.55 next year, I believe a strong dividend increase is inevitable. Ergo, I'm expecting that EMN will raise its quarterly dividend by 7.2% from $0.69 per share to $0.74 per share.

If my projection is right, my net annual forward dividends would advance by $0.80 across my four shares of the stock.

Dividend Increase #5: Broadcom (AVGO)

The semiconductor company Broadcom is the fifth stock that I'm expecting to announce a dividend hike next month. As a result of analysts' average forecast of 11.2% growth to $31.08 in EPS for next year, I believe that another double-digit dividend increase is in order. That's why I'm forecasting AVGO will raise its quarterly dividend 11.1% from $3.60 per share to $4.00 per share.

Across my three shares of the stock, this would help my net annual forward dividends to surge by $4.80 if my prediction is proven to be accurate.

Dividend Increase #6: Pfizer (PFE)

Yet another Big Pharma stock that I'm anticipating a strong dividend increase from in December is Pfizer. After notching the top-selling COVID vaccine spot for its portfolio, PFE appears to be in line to also be the leader in oral COVID-19 pill treatment space after posting impressive Phase 3 clinical trial results.

This is precisely why I'm expecting the biggest dividend increase from PFE in years. My best guess is that PFE will declare a 10.3% increase in its quarterly dividend from $0.39 per share to $0.43 per share.

If this dividend increase plays out as I expect, my net annual forward dividends will be boosted by $2.72 across my 17 shares of the stock.

Dividend Increase #7: Dominion Energy (D)

The first utility that I'm forecasting will increase its dividend in December is Dominion Energy. Given that analysts are projecting that D's EPS will grow 6.4% next year to $4.13, I believe that a 6.3% increase in the quarterly dividend from $0.63 per share to $0.67 per share will be announced.

My net annual forward dividends would advance by $0.96 across my six shares of the stock if this projection is correct.

Dividend Increase #8: WEC Energy Group (WEC)

The other utility that I believe will raise its dividend next month is WEC Energy Group. Since analysts are forecasting that WEC's EPS will increase by 5.7% next year to $4.30, I believe a similar raise is due. That's why I am expecting WEC will declare a 6.3% increase in its quarterly dividend from $0.6775 per share to $0.72 per share.

Across my seven shares of the stock, my net annual forward dividends would grow by $1.19 if this dividend increase occurs.

Dividend Increase #9: American Tower (AMT)

The wireless communications infrastructure REIT American Tower is another stock that I expect to raise its dividend in December. For those who don't know, AMT raises its dividend each quarter in smaller (if you can really say smaller given AMT's amazing growth prospects) increments. And since the dividend increases announced in December are often the largest of the year, I'm expecting big things from this REIT.

That's why I believe AMT will declare a 4.6% increase in its quarterly dividend from $1.31 to $1.37 per share.

My net annual forward dividends would be boosted by $0.72 across my three shares of the stock if this exact raise is announced by AMT.

Dividend Increase #10: Abbott Laboratories (ABT)

Another dividend increase that I'm anticipating next month is from the diversified healthcare stock Abbott Laboratories. What's especially worth noting is that this next dividend hike from ABT will represent the 50th consecutive annual dividend increase, which will make the stock a revered Dividend King.

I believe that ABT will declare an 8.9% increase in its quarterly dividend from $0.45 to $0.49 per share.

Across my six shares of ABT, this would bring in an extra $0.96 in net annual forward dividends for my portfolio if this prediction is correct.

Dividend Increase #11: Bristol Myers Squibb (BMY)

The last dividend increase that I'm forecasting for December is from Bristol Myers Squibb. 

I believe that BMY will announce an 8.2% increase in its quarterly dividend from $0.49 to $0.53 per share.

My net annual forward dividends would be boosted by $1.60 across my 10 shares of the stock if this dividend increase occurs.

Concluding Thoughts:

Without considering the dividend increase from MRK that should be announced soon, my net annual forward dividends soared $10.64 higher due to the dividend increases that I received in November 2021. This would require $304 in capital to invest at a 3.5% yield to replicate!

If my expected raise from MRK is anywhere near what I expect it will be, November 2021 will be my greatest month in terms of dollar impact of dividend increases in the four-plus years that I have been investing.

And even if my expectations for dividend increases in December 2021 prove to be moderately optimistic, my dividend increases received for the month should set yet another record to close out this year.

Discussion:

How was your November 2021 for dividend increases?

Did you receive any first-time dividend increases as I did with KEY?

I appreciate your readership and welcome your comments in the comment section below!

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