Expected Dividend Increases in April 2020 for my Vrijheid Fonds.
If you have visited Polliesdividend more often, you know that I track the dividend increases of the companies in myVrijheid Fonds. There have been quite a few dividend increases announced so far in 2020 for my Vrijheid Fonds. It definitely has been a fun time to be a dividend growth investor. In this post I try to summarize as many companies that are expected to announce a dividend increase in the coming month.
Why you ask? I find it fun to track the dividend increases because I like companies that regularly increase their dividend. I believe that companies can only increase their dividends regularly if they grow earnings sufficiently. And it is the most outward sign by management as to how business is going. These companies show confidence in the potential growth of future earnings. And that are the kind of companies I like in my Vrijheid Fonds.
Now that March has ended and the busiest time of year for dividend increases is in the rear-view mirror, we should see a slowdown in announcements as the annual shareholder meetings begin. But also, we will see some dividend suspension due to the COVID-19 Corona outbreak. And yes, unfortunately my Vrijheid Fonds will also be affected.
But before I take a look at the month of March, just let us first look back if the companies of the previous month’s article did what I expected.
Realty Income (O)
Like clockwork, this dividend Aristocrat has raised its dividend again. On March 17th 2020, Realty Income announced a 0.2% increase of their dividend. This increased marked their 106th dividend increase since Realty Income’s listing on the NYSE.
|2020 April||2019 April||2018 April||2017 April||DGR-10yrs|
Table 1. Dividend increases of O
I was spot on with my prediction. For more information about this increase see my post about this dividend increase of Realty Income.
The European Central Bank (ECB) has asked all European financial institutions to temporarily suspend their dividends. The Rabobank (A Dutch cooperative bank with an Aa3 rating from Moody’s) has decided to suspend the dividend/coupon rate for their certificates till October 2020.
This means that my Vrijheid Fonds will miss €67 in coupon rate in 2020.
NN Group NV
Also, the NN Group NV has announced the suspension of their 2019 final dividend. This means that my Vrijheid Fonds will miss €82 in dividends.
Only one dividend increase for the month of March. This nice increase is responsible that my annual dividend will increase with a total of € 0.43 ($ 0.46). My Vrijheid Fonds is working for me and gives me some extra money just by doing nothing!
However, due to the COVID-19 outbreak and the associated call from the ECB, at this moment, I will not receive €149 in dividends. Okay, this in no fun, but very logical given the situation we are in right now. And I believe that Health goes for money.
Here are my predictions for the dividend increases I expect in April:
Johnson & Johnson (JNJ)
Johnson & Johnson is a dividend king with 57 consecutive years of dividend increases. This company is really every DGI’s dream. JNJ had a great year (2019) and this will result in another nice year of dividend growth.
|JNJ||5.6%||7.1 %||5.0 %||6.7%||6.9%|
Table 2. Dividend increases of JNJ
I looked on the Internet and in their latest company financial information. On the basis of my own little research I expect the increase to be just below the company’s 10-year dividend growth average of 6.9%
Current Dividend Yield: 3.09%
Prediction: 3.0% – 6.0% increase to $0.98 – 1.01
Procter & Gamble (PG)
Procter & Gamble is another Dividend King that I expect to raise their dividend in April of this year. PG increased their dividend for 63 years uninterrupted. Procter & Gamble is the S&P Dividend Aristocrat with the longest dividend growth streak. P&G has paid a dividend in each of the past 129 fiscal years. In my opinion Procter & Gamble is not likely to reward investors with a massive bump in its payout this year.
|PG||4.0%||4.0 %||3.0 %||1.0%||5.6%|
Table 3. Dividend increases of PG
I looked on the Internet and in their latest company financial information. On the basis of my own little research I expect the increase to be below the company’s 10-year dividend growth average of 5.6%.
Current Dividend Yield: 2.71%
Prediction: 3.0% – 5.0% increase to $0.7683 – 0.7832
Southern Company (SO)
In time of crisis, Utility companies are a kind of safe haven in my opinion. Southern Company provides electricity to more than 9 million customers throughout the southeastern United States. Southern almost certainly will increase its payout for the 20th consecutive year sometime in the middle of April, but it probably won’t be much. Their current payout ratio is more than 100%, so there isn’t room for Southern Company to boost the dividend.
Table 4. Dividend increases of SO
I looked on the Internet and in their latest company financial information. On the basis of my own little research I expect a very small increase of its quarterly dividend. Besides a payout ratio of more than 100%, this company also has a debt-equity ratio of 1.7! This is a burden. So the expected increase will not be very high (or should I say not notable 😆)
Current Dividend Yield: 4.43%
Prediction: 1.0% – 3.0% increase to $0.62 – 0.64
Unilever is one of the worlds largest consumer goods company. In 2018 Unilever switched from CEO. So 2019 is the first full year of the new CEO. So he had enough time to implement his actions/ideas.
Table 5. Dividend increases of UN.AS
I looked on the Internet and in their latest company financial information. On the basis of my own little research I expect the increase to be around the company’s 5-year dividend growth average of 7.3%
Current Dividend Yield: 3.66%
Prediction: 6% – 8% increase to €0.4350 – € 0.4432
For four excellent companies of my Vrijheid Fonds I predict an increase of their dividend. So, let’s wait and see what next month will bring us. I’m excited how my predictions will turn out and I hope that I’m as right as my predictions for last month 😉
And as you are used to from me, I will write a review and look back at my predictions at the end of the month. I can’t wait for the month April and the dividend increases that will be announced. I’m always excited about new dividend increases.
How many of these companies do you own? Which other increases do you expect? Can’t wait to read your responses. Happy investing everyone!
And the most important thing: Stay safe and healthy everyone!
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