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Hot Income Stocks: Who's Growing Dividends The Fastest?

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A company that is raising its dividend certainly has its shareholders in mind. So which companies today have been raising them the fastest over the past three to five years?

IBD scoured its Dividend Leaders Screen (see a partial list on this page) to find the firms that are showing at least double-digit growth in the cash payout. Twenty-nine make the cut. The average long-term increase is 26%.

Imagine owning a stock that not only has excellent earnings stability (which is critical for dividends) and sound fundamentals but also has the potential for decent capital appreciation and a bigger dividend. For an income investor, it's the best of all worlds.

Novartis ( NVS ) heads the list. IBD calculates that the Swiss ethical drug giant has grown its dividend by 60% over the past three to five years. The annualized dividend is $2.39 a share, equivalent to a 2.3% yield, which beats the S&P 500's 1.87% yield.

Novartis also boasts a three-year Earnings Stability Factor of 2 on a scale of zero (highly stable) to 99 (highly volatile).

In 2014, Novartis earned $5.23 a share on revenue of $58 billion, flat vs. a year ago.

Wells Fargo ( WFC ) ranks second in IBD's Dividend Leaders with a 57% dividend growth rate. The annualized cash dividend is $1.40 a share, yielding 2.6%.

The bank's business is centered on the U.S. consumer, mortgage and commercial markets. So it takes somewhat less of a hit on the income statement when overseas economies sour. The stock has recently rallied back above the key 50-day moving average. Upside resistance lingers near the 55 price level.

Media giantGannett ( GCI ) sports the third-best dividend growth at 56% and is followed byCME Group ( CME ) at 49% andU.S. Bancorp ( USB ) (47%). Rounding out the top 10 arePNC Financial Services (PNC) (44%),Cisco Systems (CSCO) (38%),Accenture (ACN) (33%) andQuest Diagnostics (DGX) (33%).ACE Limited (ACE) andLorillard (LO) tie for 10th at 30% growth.

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


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

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