Buy these stocks before they raise their dividends


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With earnings season currently in full swing, investors have turned most of their attention to quarterly reports, and crunching profit and revenue numbers. Earnings are certainly important to track, but as an avid dividend investor, I believe it is just as important to stay on top of dividend announcements, and in particular those stocks which will soon announce dividend increases.

There are two reasons why I like to search for companies that are close to announcing dividend increases. The first is that any time a company raises its dividend, it is a sign of management's faith in the underlying business. If a company's management was not confident that the company could afford the dividend, it would not vote to authorize the higher dividend payment.

A second reason I like to determine which companies are about to raise their dividends is because if you play the stock ahead of the announced dividend increase, you may get a little extra boost following the news. There is a lag between when a company announces a dividend and the date and when the stock trades ex-dividend, which is the date that determines those shareholders entitled to receive the dividend.

Many times, once investors learn of a dividend increase, they will add to their current positions, or set up new positions in order to take advantage of the higher dividend payment. If you can get into the stock ahead of the pack, you can sometimes get a little boost from the increased buying interest that follows a dividend increase.

The following five stocks are all likely to announce a dividend increase soon.

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This article was originally published on

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Investing , Stocks

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