1 Dreamy Dividend Stock up 11% Just Increased its Dividend by 12%!

This dividend stock is a top option for investors looking for growth — not just in share price but also in dividends — after 35 years of increases!

| More on:

If you’re an investor seeking out dividends on the TSX today, I have a stock for you. This week, Toromont Industries (TSX: TIH) came out with earnings that saw shares climb, with analysts reaffirming it as a buy. And yet, there is even more room to run — especially when considering the 12% increase in the company’s dividend.

What happened?

Shares of the Caterpillar construction dealership surged this week after the company reported strong earnings. The company’s recent earnings report for the fourth quarter passed earnings estimates by Wall Street. Revenue rose 9% to $1.23 billion for the fourth quarter, passing by $1.1 billion forecasted by analysts.

And, of course, the other important note was the increase in the company’s dividend. TIH stock reported that it would increase its dividend to reflect the company’s strong finances as well as its long-term outlook. It now offers a $1.92 annual dividend, up 11.6%. It’s now increased its dividend for 35 consecutive years.

What’s more, there was even more growth on an annual basis. Revenue hit $4.6 billion for the year, up 12% compared to 2023 levels. And despite operating income falling 3% in the quarter, it was still up by 14% year over year. Bookings increased by a solid 49% and 15% on a full-year basis. All this marks a strong quarter, with even more on the way.

Expensive? Valuable

Despite the company looking as though it remains expensive compared to peers, analysts still recommend considering the stock. TIH stock is justified when it comes to value, given the company has a more predictable demographic. In fact, it’s so predictable this could likely mean another double-digit increase in dividends for the next year.

Sure, shares jumped over 5% after earnings came out. But even more equipment is likely to be sold in the next year. Not just from TIH stock’s performance but also from lower interest rates and inflation bringing on more opportunities.

Moreover, the company continues to streamline its business operations, adding even more growth for investors. So, with macro and micro positivity for the stock, it looks like a solid choice for those seeking growth — and, of course, dividends.

Get it while it’s hot

If you’re looking for an efficient company with even more growth on the way, this could certainly be the dividend stock for you. TIH stock now offers a $1.96 dividend on an annual basis. And shares are up 11% in the last year alone. This could certainly happen again, all while bringing in solid dividends from the stock.

So, let’s say you’re an investor with $5,000 to put toward TIH stock on the TSX today. Here is what that could bring in for you within the next year.

COMPANYRECENT PRICENUMBER OF SHARESDIVIDENDTOTAL PAYOUTFREQUENCYPORTFOLIO TOTAL
TIH – now$12340$1.96$78.40quarterly$5,000
TIH – future$136.5340$1.96$78.40quarterly$5,461.20

You would now have $461.20 in returns and $78.40 in dividends. That’s total passive income of $539.60 in just a year! So, consider TIH stock as a top dividend stock on the TSX today.

Fool contributor Amy Legate-Wolfe has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

More on Dividend Stocks

Canadian Dollars bills
Dividend Stocks

Want Monthly Cash Flow? This 10.6% Dividend Stock Delivers

A 10.6% yield and monthly distributions sound appealing, but investors should understand how HDIF generates that income before buying.

Read more »

Canadian Dollars bills
Dividend Stocks

Carney Wants $1 Trillion Invested in Canada: This TSX Stock Could Benefit

Carney’s $1 trillion investment push is huge, and AtkinsRéalis could be paid to design and manage the projects that make…

Read more »

The TFSA is a powerful savings vehicle for Canadians who are saving for retirement.
Dividend Stocks

Why I’m Using These 5 Canadian Stocks as My TFSA Cornerstones

The following five Canadian stocks offer investors' strong dividend income and capital gain potential, an ideal mix for one's TFSA.

Read more »

Canadian dollars in a magnifying glass
Dividend Stocks

The Best Canadian Dividend Stocks if You Want Reliable Passive Income

These companies have increased their dividends annually for decades.

Read more »

woman gazes forward out window to future
Dividend Stocks

Your Future Self Is Counting On You to Buy This Canadian Dividend Stock Today

Explore the current trends in dividend stocks and understand the implications of dividend normalization on your investments.

Read more »

Electricity transmission towers with orange glowing wires against night sky
Dividend Stocks

Why Fortis Stock Can Handle Any Market – Here’s My Take

Fortis is a top Canadian utility stock with a massive dividend growth record. Here's why its a great dividend stock…

Read more »

A modern office building detail
Dividend Stocks

A 12% Yield Sounds Too Good: This is One to Avoid

A 12% yield can be a warning sign, not an opportunity. Here's why Timbercreek Financial's payout looks far riskier than…

Read more »

Couple working on laptops at home and fist bumping
Dividend Stocks

The Dividend Stock That Turns “Someday” Into An Actual Plan

Instead of planning for retirement "someday", turn it into an actual plan starting with this dividend stock today.

Read more »