Microsoft Joins Dividend Hike Brigade (MSFT, MO, PM, EAT, INTC)

Investing

Published: September 18, 2012 4:34 pm

Last Updated: March 26, 2020 10:55 pm

By now you know that we enjoy looking for dividends. Dividend hikes are even better than just looking at high dividends. Microsoft Corp. (NASDAQ: MSFT) has just delivered upon our ambition of hiking its quarterly dividend.

Over the last 45 days we have been talking about the remaining key DJIA and S&P 500 stocks we expect to hike their dividends before the end of 2012. Of the twelve companies we targeted, Altria Group Inc. (NYSE: MO) has already delivered on a dividend hike as has Phillip Morris International (NYSE: PM). Brinker International Inc. (NYSE: EAT) raised its payout 25% in recent weeks.

As far as the total dividend hike, it is 15% to $0.23 per share per quarter from $0.20 per quarter per share. Based upon a $31.17 closing price, the new dividend yield will be 2.95%. Unfortunately, investors are hoping for a much more aggressive dividend stance. The prior dividend was only 26% of the adjusted earnings being paid out. It is very possible that many investors would also just prefer to get a substantial one-time dividend payment as well.

For a comparison of strong technology dividend yields, Intel Corp. (NASDAQ: INTC) has a yield of about 3.9% now that its share price has come back under pressure.

JON C. OGG

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