As dividend investors, it’s our goal to build a portfolio of stocks with high and safe yields that have the ability to grow their dividends over time. One way to find a great dividend stock is to take a closer look at those that recently announced increases, so with this in mind, let’s check out three that did so on February 24.
1. Royal Bank of Canada
Royal Bank of Canada (TSX:RY)(NYSE:RY) is the second-largest bank in Canada with approximately $1.2 trillion in total assets.
In its first-quarter earnings report on February 24, it announced a 2.5% increase to its dividend to $0.81 per share quarterly, or $3.24 per share annually, and this gives its stock a yield of about 4.8% at today’s levels.
Investors must also make two notes.
First, Royal Bank of Canada has raised its annual dividend payment for five consecutive years, and its recent increases, including the one noted above and its 2.6% hike in August 2015, has it on pace for 2016 to mark the sixth consecutive year with an increase.
Second, the company has a target dividend-payout range of 40-50% of its net income, so I think its consistent growth will allow its streak of annual increases to continue for the next several years.
2. Boralex Inc.
Boralex Inc. (TSX:BLX) is one of the largest producers of wind, hydroelectric, thermal, and solar power in Canada, the United States, and France.
In its fourth-quarter earnings report on February 24, it announced a 7.7% increase to its dividend to $0.14 per share quarterly, or $0.56 per share annually, and this gives its stock a yield of about 3.6% at today’s levels.
Investors should also make two notes.
First, this was the first time that Boralex has raised its dividend since it began paying one in 2014.
Second, the company has a medium-term target dividend-payout range of 40-60% of its discretionary cash flows, so I think its very strong growth could allow this to mark the starting point to an extensive streak of annual increases.
3. Innergex Renewable Energy Inc.
Innergex Renewable Energy Inc. (TSX:INE) is one of North America’s leading producers of hydroelectric, wind, and solar power.
In its fourth-quarter earnings report on February 24, it announced a 3.2% increase to its dividend to $0.16 per share quarterly, or $0.64 per share annually, and this gives its stock a yield of about 5.1% at today’s levels.
Investors must also note that Innergex has raised its annual dividend payment for two consecutive years, and this increase has it on pace for 2016 to mark the third consecutive year with an increase.
Does one of these stocks belong in your portfolio?
Royal Bank of Canada, Boralex, and Innergex Renewable Energy announced dividend increases on February 24, and I think all three represent very attractive long-term investment opportunities today. Foolish investors should take a closer look and strongly consider initiating positions in one or more of them.
