Five Companies Expected To Hike Dividend This Year

Dividend growth stocks have finally started getting more attention from investors in the last couple years. But these new dividend investors need to remember, it isn't just the current dividend yield that should matter when deciding whether to purchase a stock. The amount of dividend growth should also factor into your decision making process. The global economy is certainly in better shape than it was a couple years ago. Corporate balance sheets are largely in good shape, which has led to quite a few more dividend increases in 2011 than there have been in recent years. Companies across many different industries are taking the initiative to put money back into shareholders pockets, which is a tremendous plus for individual investors. Are you looking for some companies who will likely be hiking their dividend in 2011? Let's take a look at five companies that should keep the trend of increased dividend payouts going. Five Companies Expected to Hike Dividends in 2011 1. Altria Group (NYSE:MO): I fully expect Altria to once again raise its dividend in 2011. The company has an impressive history of raising its dividend, and there is no reason to believe that will stop this year. This is a company that has increased its dividend payout for 43 consecutive years. Altria currently yields 5.6 percent. The stock has a payout ratio of 77 percent, but that shouldn't be considered a problem since the company has publicly said numerous times that they want to return 80 percent of earnings to shareholders. 2. Microsoft Corp. (Nasdaq:MSFT): Microsoft is the ultimate technology cash cow, which should allow them to continue to give back to shareholders at an increasing rate in the future. In 2010, Microsoft announced a 23 percent increase in its dividend payout. Based on Intel's multiple dividend increases in the past six months, I think Microsoft is quite likely to give more back to shareholders again in 2011. The company has a payout ratio of just 23 percent, so there is a lot of room for growth in the dividend moving forward. 3. Target Corp. (NYSE:TGT) Target's management has proven adept at generating cash flow for the company through innovative sales techniques. Economic stabilization and a steady increase in retail spending is a big boost for  a company like Target. The stock currently yields 1.9 percent. Target's margins have been improving of late as the retailer has done a nice job managing inventories. The extremely low dividend payout ratio of 21 percent tells me that Target is likely to boost its dividend in 2011. 4. Aflac Inc. (NYSE:AFL) You probably know this company by its catchy television advertisements, but there is a very solid stock story going on here. This is a company that has raised its dividend for 28 straight years. Some thought the streak might be in jeopardy this year, but CEO Dan Amos actually said a couple weeks ago that he fully expects the company to continue that streak in 2011. Aflac's payout ratio is just 26 percent, so there is little reason to doubt the ability of this company to continue the trend. Aflac shares are currently yielding 2.2 percent. 5. Nike Inc. (NYSE:NKE) Nike is a high-quality growth stock that also happens to be committed to returning capital to shareholders. The stock currently yields 1.4 percent. This footwear leader has built up a solid balance sheet over the last few years. In 2010, the company raised its dividend by an impressive 15 percent, and I think a similar increase is likely later this year. Nike still leads the industry when it comes to cash flow generation, and management has done a good job maximizing return on equity. Nike's dividend payout ratio is just 27 percent.  ... Read more