3 Equities Hike Quarterly Dividends 5%-Plus and Offer 3%-Plus Yields
By: Ned Piplovic,
Two utilities and a real estate investment trust (REIT) that currently yield around 3.5% boosted quarterly dividends at least 5% to continue their respective records of raising annual payouts.
Over the last two weeks, these three equities declared their dividends and announced quarterly distribution hikes of 5.0%, 5.7% and 5.9% over the previous period. While the ex-dividend date for all three investments is March 13, 2017, there is still time to act this week to take advantage of the opportunity to generate additional income for your portfolio.
Xcel Energy Inc. (NYSE:XEL)
Xcel Energy Inc., generates, purchases and distributes electricity in the United States. The company generates electricity through coal, nuclear, natural gas, hydroelectric, solar, biomass, oil and wind energy sources. Additionally, the company purchases, transports and distributes natural gas and develops and leases natural gas pipelines and storage facilities.
The company declared its most recent quarterly dividend hike of 5.9% from $0.34 to $0.36, which is equivalent to a $1.44 annualized payout and a 3.3% yield. This dividend boost is Xcel Energy’s 14th consecutive year of rising dividends. The company has increased its dividend an average 5% every year since 2003.
After dropping 5% between March and April 2016, the share price rose almost 20% to reach its 52-week high in the first week of July. However, the share price lost all those gains and fell below March 2016 levels to reach a new 52-week low of $38.00 in early October.
Fortunately, the price has been rising again since October 2016 and has closed on March 6 at $43.62, which is only 4% short of the July’s price high and 15% above the March 2016 share price. While the share price has incurred some volatility from time to time, it has increased 67% over the last five years.
Digital Realty Trust, Inc. (NYSE:DLR)
Digital Realty Trust, Inc., is a REIT that owns, develops and manages technology-related real estate properties. It focuses on strategically internet gateway properties, corporate datacenters, technology manufacturing properties and offices of technology companies. The REIT’s portfolio has more than 60 properties in North America and a dozen properties in Europe.
The company boosted its current quarterly dividend by 5.7% to $0.93, which is equivalent to a $3.72 annual distribution and a 3.4% yield. Since 2004, the REIT has increased its annualized payout amount by an average rate of 12.7% every year. Consequently, the current payout is more than four times higher than the annual dividend paid 12 years ago.
The share price rose 37.6% from its 52-week low on March 8, 2016, to reach its 52-week high only four month later, on July 6, 2016. After the July peak, the share price lost almost 23% by the middle of November. Since then, the price recovered most of that loss and closed on March 6, 2017, at $107.70, which is less than 5% short of the July high, but is 31% higher than the 52-week low from March 2016.
NorthWestern Corporation (NYSE:NWE)
NorthWestern Corporation, doing business as NorthWestern Energy, provides electricity and natural gas to more than 700,000 residential, commercial, and industrial customers in Montana, South Dakota and Nebraska. While the company’s Electric Operations segment generates, transmits and distributes electricity, its Natural Gas Operations segment produces, stores, transmits and distributes natural gas.
The current quarterly dividend of $0.525 is 5% higher than previous quarter’s payout. NWE’s annual dividend of $2.10 is equivalent to a 3.6 yield.
The annualized dividend hike for 2017 is the 12th consecutive year that NorthWestern Energy has increased its annual dividend distribution. Since 2005, the company has boosted its annualized payout by an average 6.4% every year.
The share price reached its 52-week high of $63.75 in early July 2016 before it dropped 15.5% in three months. After bottoming out in early October, the price recovered 8.6% and closed on March 6 at $58.48. I the last five years the share price appreciated almost 70%.
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Ned Piplovic is the assistant editor of website content at Eagle Financial Publications. He graduated from Columbia University with a Bachelor’s degree in Economics and Philosophy. Prior to joining Eagle, Ned spent 15 years in corporate operations and financial management. Ned writes for www.DividendInvestor.com and www.StockInvestor.com.