One of the most successful investment strategies is to buy and hold stocks with track records of dividend growth; this is because a rising dividend is a sign of a very strong business with excellent cash flows and earnings to support increased payouts, and the dividends themselves really add up over time when reinvested. With this in mind, let’s take a look at two stocks that raised their dividends last week and have track records of doing so, so you can determine if you should invest in one of them today.
Great-West Lifeco Inc. (TSX:GWO)
Great-West Lifeco is an international financial services holding company with interests in life insurance, health insurance, retirement and investment services, asset management, and reinsurance businesses.
In its fourth-quarter earnings release on February 8, Great-West Lifeco announced a 6% increase to its quarterly dividend to $0.389 per share, equating to $1.556 per share on an annualized basis, which brings its yield up to about 4.6%.
Foolish investors should make three additional notes.
First, the first payment at the increased rate will come on March 29 to shareholders of record at the close of business on March 1.
Second, the company has raised its annual dividend payment each of the last three years, and this hike has it on track for 2018 to mark the fourth straight year with an increase.
Third, I think its consistently strong growth of operating cash flow, including its 8% year-over-year increase to $6.76 billion in 2017, will allow it to continue to deliver dividend growth to its shareholders for many years to come.
Brookfield Infrastructure Partners L.P. (TSX:BIP.UN)(NYSE:BIP)
Brookfield Infrastructure Partners is one of the world’s largest owners and operators of infrastructure assets, including rail tracks, ports, toll roads, natural gas transmission lines and storage facilities, communication towers, and electricity transmission lines, which are located across North and South America, Europe, Australia, and India.
In its fourth-quarter earnings release on February 9, Brookfield announced an 8% increase to its quarterly distribution to US$0.47 per unit, equating to US$1.88 per unit on an annualized basis, which brings its yield up to about 4.6%.
Investors must make three additional notes.
First, the first payment at the increased rate is payable on or about March 29 to unitholders of record at the close of business on February 28.
Second, the company has raised its annual distribution for eight straight years, and this increase has it positioned for 2018 to mark the ninth straight year with an increase.
Third, the infrastructure giant has a long-term distribution-growth target of 5-9% annually, and I think its very strong growth of funds from operations, including its 14.3% year-over-year increase to US$3.11 per share in 2017, will allow it to achieve this growth target for the foreseeable future.
