), America's largest drugstore chain, is on a select list of
stocks that have increased their dividend every year for at least
In Walgreen's case, it's boosted its payout for 38 consecutive
years. The latest increase came on July 10, when the company
raised its quarterly payout to 31.5 cents a share from 27.5
cents, an increase of 14.5%.
That brings the annual dividend to $1.26 a share, which yields
2.3% at the current share price. While that's just shy of the
average S&P 500 yield of 2.4%, it's still pretty impressive
given that the Walgreen's stock has far outperformed the
benchmark index, rising more than 50% so far this year.
The stock shot up 5% to a new high in heavy volume Sept. 12,
after Goldman Sachs upgraded Walgreen to conviction buy from buy
due to the company's aggressive expansion.
Walgreen has established a merchandising and marketing
partnership with global health and beauty products retailer
Alliance Boots. It has also expanded its joint venture with
branded and generic drug distributor AmerisourceBergen (
). And it announced plans earlier this week to buy privately held
Kerr Drug, a regional pharmacy chain in North Carolina.
Walgreen's profit likely rose 17% in the fiscal year that
ended in August. Profit for the current fiscal year is seen
rising 13%. The five-year Earnings Stability Factor is 4 on a
scale of 0 to 99, with 0 being most stable.
Meanwhile, Walgreen stands to benefit as demand for drugs
rises amid an aging society and as ObamaCare forces more people
to purchase health insurance. These favorable trends bode well
for future dividend growth.
The company is on S&P's high-yield dividend aristocrats
index, along with the likes ofCoca-Cola (
) andExxon Mobil (
), due to its long record of payout increases. IBD calculates a
three-to-five-year dividend growth rate of 25% for Walgreen.