The Weekly Dividend & Buyback (BPT, SKT, MNRO, QCOM, PAYX, AMIN, TJX, HOTT, TM, ETR, GE, JPM, UFS)

We often cover companies raising dividends and announcing new stock buyback plans.  We did see some dividend hikes this week, but there are also many unique dividend stories from this week which have flown under the radar.  This edition of The Weekly Dividend & Buyback does not have these companies in any particular order.  This weeks stocks are BP Prudhoe Bay Royalty Trust (NYSE: BPT), Tanger Factory Outlet Centers Inc. (NYSE: SKT), Monro Muffler Brake, Inc. (NASDAQ: MNRO), QUALCOMM Inc. (NASDAQ: QCOM), Paychex, Inc. (NASDAQ: PAYX), American International Industries, Inc. (NASDAQ: AMIN), TJX Cos. Inc. (NYSE: TJX), Hot Topic Inc. (NASDAQ: HOTT), Toyota Motor Co. (NYSE: TM), Entergy Corporation (NYSE: ETR), General Electric Co. (NYSE: GE), JPMorgan Chase & Co. (NYSE: JPM), and Domtar Corporation (NYSE: UFS).

These are not all dividend hikes.  Some are speculation of higher payouts and some are explanations about changes in dividend rates.  This is a much more expanded week of dividend news compared to what would have been normally expected in a pre-earnings season week that was light on news.

BP Prudhoe Bay Royalty Trust (NYSE: BPT) declared a $2.2668963 for Q1.  This may seem like a drop compared to what looked like a record level of $3.612 at its last distribution.  These payments are always different and sporadic based upon a myriad of factors from operations, to return of capital, to seasonality, and more.  Here was the last few dividends declared as an example: $1.73 Dividend; $1.65 Dividend; $0.992 Dividend; $1.637 Dividend; and $2.937 Dividend….

Tanger Factory Outlet Centers Inc. (NYSE: SKT) boosted its payment this week on an annual dividend to $1.55 per share from $1.53 per share basis.  That is above 3.5% now and we’d note that the Thomson Reuters estimates are much better than the trailing 12 months at $2.66 for December-2010 and $2.81 for December-2011.

Monro Muffler Brake, Inc. (NASDAQ: MNRO) declared a final $0.07 dividend but for the year ahead it has declared that it will begin paying a $0.09 dividend per quarter.

QUALCOMM Inc. (NASDAQ: QCOM) was a bit of a misnomer when it came to a raised dividend.  The $0.19 dividend declared was higher than a year ago.  The problem is that QUALCOMM already raised its dividend and upped its share buyback plan when its stock was in severe trouble as a stabilization factor.  Some aggressive reporting brought up the thought that was a raised dividend, which is not the company trying to pass of re-news.

Paychex, Inc. (NASDAQ: PAYX) came up in a personal conversation this week as to why it did not raise its dividend.  It announced its same $0.31 per share payout.  The reason is simple.  The company is just coming off the worst employment cycle in a generation and consensus analyst targets from Thomson Reuters are May-2010 at $1.34 EPS and May-2011 at $1.43 EPS.  The dividend coverage ratio here is just still too close.  It raised the dividend a penny in 2008 but the big hike came in 2007 when the dividend went from $0.21 to $0.30.  While everyone likes to see dividend hikes, some patience is needed here before a hike should be demanded.  In fact, investors may feel lucky that it did not do the dividend cut seen elsewhere.

American International Industries, Inc. (NASDAQ: AMIN) is an unknown company to most, and this is not a traditional dividend.  The company plans to declare a special dividend of one common share of Brenham Oil & Gas for each share each share of the company’s common stock owned by shareholders.  Brenham presently owns an oil and gas mineral royalty interest in a unit operated by Anadarko Petroleum Corporation in Brenham, Texas.  It notified that an S-1 filing would come into play, so consider this a spin-off for all practical purposes.

TJX Cos. Inc. (NYSE: TJX) was a legitimate dividend boost.  The company raised its payout by 25% to $0.15 per quarter from $0.12 per quarter.  It also reaffirmed a $1 billion share buyback program.  With a same-store sales figure of 12%, that dividend hike was easy and the $0.60 payout per year compares to Thomson Reuters estimates of $3.18 EPS for January 2011.

Hot Topic Inc. (NASDAQ: HOTT) was an unusual gainer because its same store sales were not solid.  But the company did authorize a special one-time dividend of $1.00 per share in cash, and it also set a forward dividend of $0.07 in cash per quarter.

The potential biggie is from Toyota Motor Co. (NYSE: TM).  Reports are out that it is cutting the dividend.  That was first reported by Sankei and then via Bloomberg, but we did not see any press release from the company.  With its recall issues pouncing it, this shouldn’t be a huge shock and would likely be temporary until it gets this crisis behind it.

Earlier this week we also saw a dividend hike by Entergy Corporation (NYSE: ETR) based upon a $0.75 dividend before going up to $0.83 per quarter. That new yield is 4.05% based upon today’s prices. The issue is that it backed off of prior goals of spinning off the nuclear assets.

There are two DJIA components reporting next week that dividend investors need to keep on their radar screen.  General Electric Co. (NYSE: GE) and JPMorgan Chase & Co. (NYSE: JPM) are both on deck.  Jamie Dimon has said his bank could begin paying a higher dividend, but the notion that regulators want the major banks to build more balance sheet cushions rather than pay out dividends.  GE’s Keith Sherin signaled that GE would begin hiking their dividend in 2011.  The stance of 24/7 Wall St. is that GE is likely to begin higher payouts sooner rather than later and it has its shareholder meeting late this month.  Both could be back to at least higher than current dividend rates this summer, but do not expect the old rates to be back for some time.

Elsewhere in dividend news, RBC’s analyst noted that Domtar Corporation (NYSE: UFS) may be on the hunt of companies to raise dividends.  This is not company news, but the call noted it has reached or is close to the lower end of its $1.0 billion to $1.2 billion net debt target, which will allow it to reinstate a dividend as soon as before the end of the year.  This one was not one any of our dividend hike company prospects for 2010, so make that a new one.  This hit a 52-week high today and the new 52-week range is $10.68 to $72.50 for the paper, pulp, and lumber company.

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JON C. OGG