Dividend growth is often a key factor for investors seeking stable returns, and four global companies are notable for their consistent — and significant — payout increases. A screen of 100,000 stocks on FactSet by CNBC Pro identified just four major stocks from around the world that have raised their dividends per share (DPS) by more than 10% annually for the past fifteen years. The companies are: U.S.-listed Atrion Corporation , European firms TEXAF and Kerry Group , and Japan’s GMO Payment Gateway . The chart below illustrates the shareholder payouts since 2007 for the four stocks: Brussels-based TEXAF, an investment holding company with interests across real estate and mining in Africa, has outpaced the broader market with steady gains in dividends since 2007. Among the stocks screened by CNBC Pro, the 98-year-old firm offered the highest dividend yield at 3.3%. Dividend yield is calculated as the dividend per share divided by the share price. The dividend yield can go up if the share price drops, and conversely, the yield can drop if the share price goes up. Similarly, Atrion Corporation , a manufacturer of cardiovascular medical devices, has consistently raised its shareholder payouts by double-digits for over a decade. The 79-year-old company currently offers a 1.5% dividend yield. Meanwhile, the Kerry Group , one of Europe’s largest food and beverage companies, is well-known for its dividends, having paid out every year since its listing in 1986. It has also consistently raised dividends by more than 10% since 1993. While the stock’s current 1.2% dividend yield is not particularly high, analysts expect the share price to increase by 27% over the next 12 months on average. The stock has risen 340% in price returns, which strips out dividend payments, over the past 15 years. Lastly, GMO Payment Gateway — a prominent online payments company in Japan — stands out in a sector often characterized by reinvestment over dividend payouts. Alongside raising its dividends consistently over the past 15 years, GMO Payment’s stock has also risen by more than 4,000% in price returns over the same period. The stock currently offers a 0.7% dividend yield, the lowest among the stocks screened by CNBC Pro. What’s the significance of a dividend growth stock? When a company raises DPS by 10% each year, it indicates that the company is not just profitable, but its management expects its profitability to grow. For investors, this means their income from the investment grows each year, which can lead to substantial returns over time. For instance, a fictional $10,000 investment in a stock with a 3% dividend yield at the time of purchase would receive $300 in dividends at the end of the first year. However, if the company increases its DPS by 10% annually, the dividends received in the second year would increase to $330 (10% more than $300) —and so on for as long as dividends are increased. The example also doesn’t take into account any changes in the stock price itself. If the stock price also appreciates, the total return for the investor (capital gains plus dividends) would be even higher. Investors should be aware that equities carry a higher risk level than investments such as U.S. government bonds, for instance. Also, when a company pays dividends it is foregoing reinvesting in growth.
These 4 global stocks have raised dividends by more than 10% for the past 15 years
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