Investing

Red-Hot Semiconductor Capital Equipment Giant Is Raising Its Dividend by a Stunning 17.2%

Lee Jackson

Published: November 13, 2024 7:12 am

Last Updated: November 13, 2024 10:51 am

Key Points

• The Federal Reserve lowered the federal funds rate last week to 4.50% to 4.75.
• Wall Street expects another 25-basis-point cut in December.
• Dividend stocks will remain popular as rates go lower.
• Investors looking for the top dividend stocks to add to their portfolios should enlist the help of a qualified financial planner. Click here to get started finding one.

After years of a low-interest rate environment, which has reversed significantly over the past two years and is headed lower once again, many investors continue to turn to equities for growth potential and solid and dependable dividends. These help provide an income stream, equating to total return, one of the most influential investment strategies.

We always like to remind our readers about the impact total return has on portfolios because it is one of the best ways to improve their chances of overall investing success. Again, total return is the combined increase in a stock’s value plus dividends.

For instance, if you buy a stock at $20 that pays a 3% dividend, and it goes up to $22 in a year, your total return is 13%. That is, 10% for the increase in stock price and 3% for the dividends paid.

Three Wall Street favorites, including a semiconductor capital equipment behemoth, announced plans to raise their dividends last week. So we screened our 24/7 Wall St. research universe and found that top firms on Wall Street rate them all at Buy. The excellent news for investors is that those looking to buy these top companies can grab all three before the stocks go ex-dividend.

Why do we cover stock dividend increases?

Not only is increasing dividends and returning capital to investors an excellent sign from corporate  C-Suite management, but it also shows that the companies are doing well financially and have the earnings and cash flow strength to increase the payouts.

KLA

This is a solid large-cap play for investors seeking exposure to semiconductor capital equipment. KLA Corp. (NASDAQ: KLAC) designs, manufactures, and markets process control and yield management solutions for the worldwide semiconductor and related electronics industries.

The company operates through three segments:

• Semiconductor Process Control
• Specialty Semiconductor Process
• PCB and Component Inspection

KLA offers:

• Inspection and review tools to identify, locate, characterize, review, and analyze defects on various surfaces of patterned and unpatterned wafers; metrology systems that are used to measure pattern dimensions, film thickness, film stress, layer-to-layer alignment, pattern placement, surface topography, and electro-optical properties for wafers.
• Chemical process control equipment; wired and wireless sensor wafers and reticles; wafer defect inspection, review, and metrology systems; reticle inspection and metrology systems; and semiconductor software solutions that provide run-time process control, defect excursion identification, process corrections, and defect classification to accelerate yield learning rates and reduce production risk.

It also provides etch, plasma dicing, deposition, and other wafer processing technologies and solutions for the semiconductor and microelectronics industry.

In addition, the company offers:

• Direct imaging, inspection, optical shaping, inkjet, and additive printing
• UV laser drilling and computer-aided manufacturing and engineering solutions for the PCB market
• Inspection and electrical testing systems to identify and classify defects, as well as systems to repair defects for the display market; and inspection and metrology systems for quality control and yield improvement in advanced and traditional semiconductor packaging markets

The new dividend for shareholders was declared on November 7th.

• New dividend amount: $1.70, which translates to a 1% yield
• Previous amount: $1.45
• Increase: 17.2%
• The ex-dividend date to receive the increase is November 18th, and it will be paid on December 3rd.

Lancaster Colony

This specialty food company makes well-known products that top chefs and consumers love. Lancaster Colony Corp. (NASDAQ: LANC) manufactures and markets specialty food products for the retail and food service channels in the United States.

It operates in two segments:

• Retail
• Foodservice

The company offers:

• Frozen garlic bread under the New York BRAND Bakery
• Frozen Parkerhouse-style yeast and dinner rolls under Sister Schubert’s brand
• Salad dressings under the Marzetti, Cardini’s, Dressed, and Girard’s brands
• Vegetable and fruit dips under the Marzetti brand
• Croutons and salad toppings under the New York BRAND Bakery, Chatham Village, and Marzetti brands
• Frozen pasta under the Marzetti Frozen Pasta brand.

It also manufactures and sells other products to brand license agreements, including:

• Olive Garden dressings
• Buffalo Wild Wings sauces
• Chick-fil-A sauces

The company sells its products through sales personnel, food brokers, and distributors to retailers and restaurants.

The new dividend for shareholders was declared on November 6th.

• The new dividend amount $0.95, which equals a solid 1.93%
• Previous amount: $0.90
• Increase: 5.6%
• The stock goes ex-dividend on December 6th, and it will be paid on December 31st

Lancaster Colony has a remarkable track record of 62 consecutive years of increasing regular cash dividends, which makes it a Dividend King. The company is one of only 12 U.S. companies with 62 straight years of regular cash dividend increases.

Sprott

This Canadian financial giant is well-regarded across Wall Street. Sprott Inc. (NYSE: SII) is a publicly owned asset management company.

Through its subsidiaries, the firm provides to its clients:

• Asset management
• Portfolio management
• Wealth management
• Fund management
• administrative and consulting services to its clients.

It offers mutual funds, hedge funds, and offshore funds, as well as managed accounts. The firm also provides broker-dealer activities.

The new dividend for shareholders was declared on November 5th.

• The new dividend amount is $0.30, which equals an excellent 2.77%
• Previous amount: $0.25
• Increase: 20%
• The stock goes ex-dividend on November 17th and the payout date is December 3.

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