Investing

Dividend Watch: 3 Companies Boosting Payouts

Derek Lewis

Published: September 12, 2023 11:42 pm

Last Updated: September 13, 2023 11:45 am

Shareholders can receive many positive announcements, such as upgraded guidance or news of a hot acquisition. Of course, dividend boosts are another one of these favorable announcements, with the news fully reflecting a shareholder-friendly nature.

And as of late, three companies – Altria MO, NetEase NTES, and Verizon Communications VZ – have all recently boosted their payouts. Let’s take a closer look at each for those interested in an income-focused approach.

Altria

Altria Group is a world-leading producer and marketer of cigarettes, tobacco, and other similarly related products. The company’s Board of Directors recently voted to increase its quarterly dividend by 4.3% to $0.98 per share.

As shown below, Altria has a long history of increasing its dividend payout, reflecting its shareholder-friendly nature.

The company’s shares aren’t valuation stretched, with the current 8.9X forward earnings multiple sitting well below the 10.1X five-year median and the Zacks – Tobacco industry average. The stock sports a Style Score of “B” for Value.

Altria is expected to post modest growth in its current year, with Zacks Consensus Estimates suggesting 3% earnings growth on 1% higher sales.

NetEase

NetEase, a current Zacks Rank #1 (Strong Buy), is an Internet technology company engaged in the development of applications, services, and other technologies for the Internet in China. Analysts have taken their earnings expectations higher across all timeframes.

The company recently announced an 11% increase to its quarterly dividend to $0.52 per share, compared to $0.47 per share previously.  As shown below, the company’s payout has grown nicely over the recent years, sporting a 26% five-year annualized dividend growth rate.

Verizon Communications

Verizon offers communication services in the form of local phone service, long-distance, wireless, and data services. The company recently announced a slight 2% boost to its quarterly payout, bringing the total to $0.65 per share.

Like those above, the company has shown a commitment to shareholders over the years, as illustrated below. VZ’s payout has grown by a modest 2% annually over the last five years.

And the company generates ample cash to keep the dividend boosts coming, with VZ posting $5.6 billion in free cash flow in its latest quarter. It’s worth noting that the company’s top and bottom lines are forecasted to take hits in its current year (FY23), with estimates indicating 9% lower earnings on 2% lower sales.

Bottom Line

Everybody loves dividends, as they provide a passive income stream, more than one way to profit from an investment, and a buffer against drawdowns in other positions.

And recently, all three companies above – Altria MO, NetEase NTES, and Verizon Communications VZ – have boosted their payouts, reflecting their shareholder-friendly natures.
Verizon Communications Inc. (VZ): Free Stock Analysis Report

Altria Group, Inc. (MO): Free Stock Analysis Report

NetEase, Inc. (NTES): Free Stock Analysis Report

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