6 Institutional Picks Raising Dividends on Improved Net Profit Margins

Increases in dividends are usually greeted favorably by the market, as long as the payout ratio remains sustainable (dividend per share/EPS under 35%). Dividend increases convey greater confidence from management in the company’s operations, and they directly increase value for shareholders. When dividend increases are coupled with improvements in profitability, the signal to the market is even more positive. Here we ran a screen with that idea in mind, searching those stocks that have seen significant net buying interest from institutional investors (i.e. the “smart money”) while increasing dividends on improved net profit margins. We also controlled for sustainable payout ratios below 35%. Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the top six stocks mentioned below. Analyst ratings sourced from Zacks Investment Research. Your browser does not support iframes. Do you think these stocks have reliable dividends? Use this list as... Read more