Stocks that offer superior dividend yields have an obvious appeal, especially for investors with current income as their primary objective. They provide a steady stream of income that shareholders can either spend, save or reinvest in the market. This benefit is especially important to retired people or others who invest for income.
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Stocks with growing dividends are even more attractive. A company that can grow its yield by increasing its dividend is generally one with sound finances and a high level of confidence in its future revenue and earnings. A stock’s performance includes its income yield as well as capital appreciation. This means growing dividend payouts can enhance a stock’s overall total return potential.
In short, companies with growing payouts are considered stable and reliable. The predictable, increasing income they offer helps investors survive through the inevitable volatility that comes with stock market investing.
Here’s a list of eight dividend stocks with growing dividend payouts that investors should consider buying now:
| Stock | Dividend yield* |
| Verizon Communications Inc. (ticker: VZ) | 7% |
| Walmart Inc. (WMT) | 1.4% |
| Enterprise Products Partners LP (EPD) | 7.6% |
| Clorox Co. (CLX) | 3.4% |
| Visa Inc. (V) | 0.7% |
| McDonald’s Corp. (MCD) | 2.1% |
| JPMorgan Chase & Co. (JPM) | 2.4% |
| Allstate Corp. (ALL) | 2.6% |
*Trailing-12-month yield based on Dec. 27 close.
Verizon Communications Inc. (VZ)
About 23 years ago, the regional phone company, Bell Atlantic, merged with GTE, a company that had become a leader in the wireless communication sector. The new entity called itself Verizon and has been a nationwide powerhouse in the mobile telecommunications industry ever since.
Today, VZ provides wireless services and equipment to businesses and consumers all over the world and, true to its roots as a regional telecom, fixed-wire phone service to customers up and down the eastern seaboard.
In October 2023, VZ increased its quarterly dividend from 65.25 cents to 66.55 cents, which equates to $2.66 per share per year. That 2% hike marked the 17th consecutive year the company’s board of directors increased the dividend. Based on VZ’s Dec. 27 closing price, the 12-month yield is 7%.
Walmart Inc. (WMT)
With about 10,500 stores and $600 billion in annual revenue, WMT is by far the world’s largest brick-and-mortar retailer. The company operates department stores, super centers and big-box wholesale clubs in 20 countries. WMT is also making a concerted effort to compete with Amazon.com Inc. (AMZN) in the e-commerce space.
WMT offers retail consumers an astounding array of products ranging from electronics, apparel and furniture to health and beauty. The company also offers pharmacy services, financial products such as money orders, and automotive services like gas, tires and oil. Walmart’s consistent performance makes it a favorite of retail and institutional investors.
The company’s huge geographic footprint and incredible revenue have allowed it to increase its dividend every year for 50 straight years. The most recent increase happened in February 2023 when it raised its annual dividend by 2% from $2.24 to $2.28. The stock yields 1.4% as of the Dec. 27 close, but, based on history, investors can expect higher dividends and higher yields in the future.
Enterprise Products Partners LP (EPD)
EPD is a midstream energy company organized as a master limited partnership. The Houston-based company operates in the transportation and storage sectors of the hydrocarbon energy industry. Specifically, EPD operates natural gas and crude oil pipeline networks, truck fleets and storage facilities that provide energy products and petrochemicals to businesses and consumers throughout the U.S.
Many of EPD’s terminals and facilities are located near seaports in Texas, Mississippi and Louisiana. Meaning, in addition to servicing U.S. customers, EPD is an important facilitator for exports of oil and liquefied natural gas to countries around the world.
EPD pays a dividend of 50 cents a quarter, which is a full 5% more than the 47.5 cents it was paying at the same time last year. EPD’s 12-month yield of 7.6% makes it the highest-yielding stock on our list.
Clorox Co. (CLX)
CLX was founded 100 years ago in Oakland, California and has since become one of the most well-known and trusted companies in the consumer products industry.
The company is most famous for its laundry and cleaning products such as Clorox Bleach and Handi Wipes. It’s also prominent in the grocery sector through brands like KC Masterpiece sauces and Hidden Valley salad dressings, as well as in the health and beauty sector, pet products and more.
In the fourth quarter of its 2023 fiscal year, which ended in June, the company reported net sales of $2 billion — an impressive gain of 12% over the same period the year before. That excellent performance led the board of directors to increase the annual dividend by 1.7% from $1.18 to $1.20, which equates to a healthy 12-month yield of 3.4% when measured from its Dec. 27 closing price.
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Visa Inc. (V)
Most people know Visa as a consumer credit card company, and — along with American Express Co. (AXP), Discover Financial Services (DFS) and Mastercard Inc. (MA) — it is certainly one of the most prominent firms in that space. But over the last several years, Visa has reinvented itself to become a leader in all aspects of the high-tech worldwide payment processing industry.
The company now offers instant business-to-business and consumer payment systems, click-to-pay services, prepaid and debit cards, and many other similar financial services. Visa works with banks and brokers to quickly clear deposits and deliver funds. The company also creates and manages “digital wallets” for individuals and businesses. Interestingly, Visa is now using AI technology to become a preeminent fraud detection and mitigation company.
The stock price reflects the company’s exemplary performance. V is up around 25% year to date as of its Dec. 27 close, and it raised its quarterly dividend from 45 cents to 52 cents in October, a 16% increase.
McDonald’s Corp. (MCD)
No fast-food restaurant company is better known in the U.S. and around the world than McDonald’s, and over the last decade or so there are very few that have been better managed.
In 2020, MCD reported revenues of $19 billion. As we wrap up 2023, the company is expected to take in over $25 billion for the year. The company’s improving finances can be attributed to a successful turnaround strategy that began under the newly appointed CEO, Steve Eastbrook, in 2015. The stock is up more than 200% since Eastbrook took over, and it doesn’t appear to be slowing down. Eastbrook’s continuing plans include modernizing and upgrading stores, strategically raising prices, and increasing the use of mobile and kiosk order processing. It seems to be working to the benefit of shareholders and customers.
MCD had a 12-month yield of 2.1% on Dec. 27, based on its annual dividend of $6.68 a share. The current annual dividend represents a 10% increase — up from $6.08 — over the same period last year.
JPMorgan Chase & Co. (JPM)
Considering a very challenging rising-interest-rate and high-inflation environment over the last two years, the performance of JPM, under the leadership of CEO Jamie Dimon, has been truly extraordinary. While most banks struggled and some failed, JPM has provided shareholders with excellent returns.
JPM is a commercial bank that offers depository accounts, lending and banking services, and investment banking to retail and institutional clients online and through its extensive branch network. Its customers range from small individual account holders to ultra-wealthy individuals, large corporations, municipalities and governments.
JPM has yet to report its fourth-quarter earnings, but Wall Street is estimating that full-year 2023 revenue will top $159 billion. If the company can achieve that number, it will be an increase of $31 billion over 2022.
In October 2023, JPM raised its quarterly dividend by 5% from $1 to $1.05. The stock currently yields 2.4%, and investors are counting on a growing yield in years to come.
Allstate Corp. (ALL)
Long-term holders of ALL have reason to be pleased. The stock is up around 57% over the last five years, and that does not include the healthy dividend yield investors have earned on top of capital appreciation.
ALL and its affiliated brands provide property, casualty and other types of insurance to individuals and businesses of all sizes. In addition to traditional insurance lines, Allstate also offers other kinds of coverage, such as electronics and appliance coverage plans. The company has even used sophisticated AI technology to expand into data collection and analytics.
Shareholders currently enjoy a $3.56 annual dividend. As of Dec. 27, that translates to a yield of 2.6%. The dividend throughout 2022 was $3.40, up from $3.24 in 2021. Dividend and yield growth is not guaranteed to continue at that pace, but investors should feel good about buying a stock with the income track record of ALL.
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8 Dividend Stocks With Growing Payouts originally appeared on usnews.com
Update 12/28/23: This story was published at an earlier date and has been updated with new information.
