In this article, we discuss 10 companies that just increased their dividends. If you want to see some more stocks that raised their dividend payouts, click 5 Companies that Just Increased Their Dividends.
Goldman Sachs expects share buybacks in 2022 to reach $1 trillion, up 12% from 2021. The investment bank revised its forecast upwards from 8% to 12% on March 7. According to David Kostin, chief equities strategist at Goldman Sachs, the robust backlog of repurchase authorizations is already above 2021’s year-to-date record of $1.2 trillion. These authorizations are supported by strong sales, earnings growth, and fortress balance sheets.
David Kostin also observed that high dividend stocks are well suited to inflationary backdrops. Goldman Sachs upgraded its dividend growth projection to 10% from 8%, with energy stocks in the lead, driven by increased oil prices and strong cash flow. He noted that the companies with dividend yields at the top of their S&P 500 sub-sectors historically performed better than the broader index by 8% over a 12-month period when the inflation rate clocked in above 6%.
According to CME Group, S&P 500 constituents paid 60.14 index points worth of dividends in 2021. Dividend payouts are expected to grow by about 7% to 64.2 index points in 2022, which is approximately 1.4% above Treasury Inflation Protected Securities (TIPS) consumer price inflation for 2022.
S&P Dow Jones Indices reported on April 4 that indicated dividend net changes for the U.S. domestic stocks increased $18.2 billion during the first quarter of 2022, up from $18.0 billion in Q4 2021, and $18.0 billion in Q1 2021. The net dividend changes in Q1 2022 include AT&T’s $6.9 billion dividend cut, and according to Howard Silverblatt, a senior index analyst at S&P Dow Jones Indices, the net dividend payout in Q1 would have set a record had it not been for AT&T’s slashed payment.
Some of the most notable dividend payers include Microsoft Corporation (NASDAQ:MSFT), Apple Inc. (NASDAQ:AAPL), and Altria Group, Inc. (NYSE:MO), however, we discuss companies that just increased their dividends in this article.
Photo by Dan Dennis on Unsplash
Our Methodology
We selected companies that announced dividend increases in April 2022. We have mentioned the dividend yields as of May 5 for each stock, the hedge fund sentiment around the stocks, analyst ratings, and latest earnings to provide readers with better context for possible investments.
Companies that Just Increased Their Dividends
10. Parker-Hannifin Corporation (NYSE:PH)
Number of Hedge Fund Holders: 39
Dividend Yield as of May 5: 1.93%
Parker-Hannifin Corporation (NYSE:PH) is based in Cleveland, Ohio, operating as a manufacturer of motion and control technologies for mobile, industrial, and aerospace markets worldwide. The company has two primary segments – Diversified Industrial and Aerospace Systems.
On April 28, Parker-Hannifin Corporation (NYSE:PH) declared a $1.33 per share quarterly dividend, a 29.1% increase from its prior dividend of $1.03. The dividend is payable on June 3, to shareholders of record on May 13. The stock delivers a dividend yield of 1.93% as of May 5.
Parker-Hannifin Corporation (NYSE:PH) received on April 11 a conditional European Union antitrust approval for acquiring Meggitt PLC (OTC:MEGGY) in an $8.3 billion deal. The company expects to conclude the acquisition during the third quarter of 2022. For the deal to go through, Parker-Hannifin Corporation (NYSE:PH) agreed upon the sale of its Ohio-based Aircraft Wheel and Brake division.
Stifel analyst Nathan Jones on April 18 maintained a Buy recommendation on Parker-Hannifin Corporation (NYSE:PH) but lowered the firm’s price target on the stock to $338 from $384. At a high level, he expects the first quarter of 2022 to look “a lot like” Q4 2021, with guidance for Q2 also looking similar, the analyst told investors.
According to Insider Monkey’s fourth quarter database, Parker-Hannifin Corporation (NYSE:PH) was found in the portfolios of 39 hedge funds, with collective stakes worth $1.73 billion. Billionaire Andreas Halvorsen’s Viking Global is the biggest shareholder of the company, with more than 3 million shares valued at $972.4 million.
In addition to Microsoft Corporation (NASDAQ:MSFT), Apple Inc. (NASDAQ:AAPL), and Altria Group, Inc. (NYSE:MO), Parker-Hannifin Corporation (NYSE:PH) is a notable dividend candidate to watch.
In its Q1 2021 investor letter, Oakmark Funds, an asset management firm, highlighted a few stocks and Parker-Hannifin Corporation (NYSE:PH) was one of them. Here is what the fund said:
“Parker Hannifin approached our estimates of intrinsic value and were, therefore, eliminated during the period. The company was a longstanding investment of the Fund and produced successful outcomes. We believe Parker Hannifin, one of our longest tenured positions, is a high-quality, well-managed industrial with strong competitive positions in good end markets. However, after the market price reflected these positives, we elected to sell to pursue more attractive alternatives that were priced at steeper discounts to our estimates of intrinsic value.”
9. Apple Inc. (NASDAQ:AAPL)
Number of Hedge Fund Holders: 134
Dividend Yield as of May 5: 0.59%
Apple Inc. (NASDAQ:AAPL), a Big Five American tech giant, announced on April 28 a $0.23 per share quarterly dividend, a 4.5% increase from its earlier dividend of $0.22. The dividend is payable on May 12, for shareholders of the company on the close of business on May 9. The company also authorized an additional $90 billion to the existing share repurchase program.
On April 28, Apple Inc. (NASDAQ:AAPL) reported its financial results for the first fiscal quarter of 2022. The company posted earnings per share of $1.52, beating analysts’ consensus estimates by $0.09. Revenue for the period grew 8.59% year-over-year to $97.28 billion, outperforming market predictions by $3.29 billion.
Wells Fargo analyst Aaron Rakers noted on April 29 that Apple Inc. (NASDAQ:AAPL) delivered solid Q2 results due to iPhone and Mac strength, and a net-neutral capital return update. However, the analyst expects shares to trade lower or sideways over the short-term as Q3 commentary leaves him concerned about a year-over-year revenue decline. The analyst kept his Overweight rating and $205 price target unchanged, believing that Apple Inc. (NASDAQ:AAPL)’s demand remains robust and thinks the supply situation should improve now that almost all facilities have restarted production.
According to Insider Monkey’s Q4 data, Apple Inc. (NASDAQ:AAPL) shares were held by 134 hedge funds, compared to 120 funds in the prior quarter. Warren Buffett’s Berkshire Hathaway is the leading stakeholder of the company, with a position worth $157.5 billion.
Here is what Berkshire Hathaway has to say about Apple Inc. (NASDAQ:AAPL) in its Q4 2021 investor letter:
“Apple Inc. (NASDAQ:AAPL) – our runner-up Giant as measured by its year end market value – is a different sort of holding. Here, our ownership is a mere 5.55%, up from 5.39% a year earlier. That increase sounds like small potatoes. But consider that each 0.1% of Apple’s 2021 earnings amounted to $100 million. We spent no Berkshire funds to gain our accretion. Apple’s repurchases did the job. It’s important to understand that only dividends from Apple are counted in the GAAP earnings Berkshire reports – and last year, Apple paid us $785 million of those. Yet our “share” of Apple’s earnings amounted to a staggering $5.6 billion. Much of what the company retained was used to repurchase Apple shares, an act we applaud. Tim Cook, Apple’s brilliant CEO, quite properly regards users of Apple products as his first love, but all of his other constituencies benefit from Tim’s managerial touch as well.”
8. Continental Resources, Inc. (NYSE:CLR)
Number of Hedge Fund Holders: 19
Dividend Yield as of May 5: 1.84%
Continental Resources, Inc. (NYSE:CLR) was founded in 1967 and is headquartered in Oklahoma. The company offers crude oil and natural gas primarily in the United States. Continental Resources, Inc. (NYSE:CLR)’s dividend yield on May 5 stood at 1.84%.
In 2021, Continental Resources, Inc. (NYSE:CLR)’s revenue for the year came in at $5.4 billion, compared to $2.4 billion in 2020. Net income in 2021 stood at $1.6 billion, a strong rebound from the loss of $597 million in the last year.
On April 27, Continental Resources, Inc. (NYSE:CLR) declared a quarterly dividend of $0.28 per share, an increase of 21.7% from its last dividend of $0.23. The dividend is payable on May 23, to shareholders of record on May 9.
Susquehanna analyst Biju Perincheril on April 27 raised the price target on Continental Resources, Inc. (NYSE:CLR) to $66 from $61 and maintained a Neutral rating on the shares. The analyst increased his oil and gas price target assumptions and told investors that his Continental Resources, Inc. (NYSE:CLR) price target is based on about 4.2x his 2023 earnings, debt-adjusted cash flow at his $80.00 WTI/$4.25 HH price deck, as well as expected dividends for the next two years.
According to the Q4 database maintained by Insider Monkey, Continental Resources, Inc. (NYSE:CLR) was found in the public stock portfolios of 19 funds, compared to 24 funds in the prior quarter. D E Shaw is the largest shareholder of the company, with 1.85 million shares worth approximately $83 million.
Here is what Smead Capital Management has to say about Continental Resources, Inc. (NYSE:CLR) in its Q3 2021 investor letter:
“Oil stocks dominated our winners for the quarter. Continental Resources (CLR) rose 21.82% as the stock market had to reprice future cash flows on higher energy prices.”
7. Energy Transfer LP (NYSE:ET)
Number of Hedge Fund Holders: 36
Dividend Yield as of May 5: 6.73%
Energy Transfer LP (NYSE:ET) is a Texas-based energy company that was established in 1996, providing transportation pipelines and storage facilities for natural gas, crude oil, and natural gas liquids. Energy Transfer LP (NYSE:ET)’s dividend yield on May 5 came in at 6.73%.
Energy Transfer LP (NYSE:ET) declared on April 26 a $0.20 per share quarterly dividend, a 14.3% increase from its previous dividend of $0.175. The dividend is distributable on May 19, to shareholders of the company as of May 9.
In 2021, the full-year revenue for Energy Transfer LP (NYSE:ET) was $67.4 billion, up from almost $39 billion in the preceding year. The net income in 2021 sharply rebounded to $5.4 billion from the net loss of $647 million in 2020.
Morgan Stanley analyst Robert Kad raised the price target on Energy Transfer LP (NYSE:ET) to $15 from $12 and kept an Overweight rating on the shares on April 26. The outlook for the midstream sector in 2022 is positive according to the analyst, and he generally expects strong Q1 results and constructive management guidance due to the feasible commodity backdrop.
According to the fourth quarter database of Insider Monkey, 36 hedge funds were long Energy Transfer LP (NYSE:ET), compared to 29 funds in the earlier quarter. The total stakes held in Q4 2021 amounted to $635.6 million. David Abrams’ Abrams Capital Management is the leading shareholder of the company, with more than 22 million shares worth $182 million.
Miller Value Partners, an investment firm, talked about Energy Transfer L.P. (NYSE:ET) in its Q2 2021 investor letter. Here is what the fund said:
“Energy Transfer LP (ET) rose over the period along with the price of oil climbing 40.59% over the period. The company received positive news that the Dakota Access Pipeline project would not be shut down while the Environmental Impact Statement by the US Army Corps of Engineers is drawn up. Energy Transfer reported strong 1Q results with revenue of $17B surpassing expectations for $11.8B with adjusted earnings before income, taxes, depreciation and amortization (EBITDA) hitting $5.04B ahead of consensus of $2.77B. The company raised full year adjusted EBITDA guidance to $12.9-13.3B from $10.6-11.0B previously, with the increase largely related to the benefits realized from Winter Storm Uri. The company paid down $3.7B in debt during the quarter, using strong cash flow to reduce leverage. The company also announced the issuance of $900M in 6.5% Series H perpetual preferreds with the company using the proceeds to repay debt and for general purposes.”
6. Schlumberger Limited (NYSE:SLB)
Number of Hedge Fund Holders: 47
Dividend Yield as of May 5: 1.66%
Schlumberger Limited (NYSE:SLB) offers technology for the energy industry worldwide. The company operates through Digital & Integration, Reservoir Performance, Well Construction, and Production Systems divisions. Schlumberger Limited (NYSE:SLB)’s dividend yield on May 5 came in at 1.66%.
Schlumberger Limited (NYSE:SLB) reported its Q1 results on April 22, posting earnings per share of $0.34, beating estimates by $0.01. The revenue grew 14.15% year-over-year to $5.96 billion, topping analysts’ predictions by $60.73 million.
The company declared on April 22 a $0.175 per share quarterly dividend, a 40% increase from its earlier dividend of $0.125. The dividend will be distributed on July 14, to shareholders of the company as of June 1.
On April 27, Barclays analyst J. David Anderson raised the price target on Schlumberger Limited (NYSE:SLB) to $55 from $48 and maintained an Overweight rating on the shares. According to the analyst, a new upstream investment cycle “has not only just begun, but is poised to accelerate faster, last longer, and potentially be much more profitable than the prior one”. He sees the investment cycle accelerating across all primary oil and gas markets, with better visibility “by the day”.
According to Insider Monkey’s Q4 data, 47 hedge funds were bullish on Schlumberger Limited (NYSE:SLB), compared to 39 funds in the earlier quarter. Jean-Marie Eveillard’s First Eagle Investment Management held the leading stake in the company, with roughly 27 million shares worth $803.5 million.
Like Microsoft Corporation (NASDAQ:MSFT), Apple Inc. (NASDAQ:AAPL), and Altria Group, Inc. (NYSE:MO), elite investors are piling into Schlumberger Limited (NYSE:SLB).
Here is what ClearBridge Investments has to say about Schlumberger Limited (NYSE:SLB) in its Q2 2021 investor letter:
“Schlumberger is a leading oilfield services company that should enjoy both cyclical and secular opportunities over the next market cycle and beyond. On the cyclical front, after years of declining energy service activity and negative pricing, service activity is increasing modestly and pricing is inflecting higher, which is always the key cyclical driver for energy services stocks. In addition, we expect the Middle East to gain share of oil production as ESG considerations limit upstream investment in other regions. As the dominant service provider in the Middle East, Schlumberger is very well-positioned for this shift. On the secular front, Schlumberger has a rapidly growing digital services capability that helps producers operate much more efficiently and with much less waste, which will be a core ESG focus. Finally, Schlumberger is investing directly, and with partners, in energy transition capabilities such as carbon capture, hydrogen and geothermal that should allow Schlumberger to grow and remain viable well beyond the current energy cycle.”
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Disclosure: None. 10 Companies that Just Increased Their Dividends is originally published on Insider Monkey.
