With U.S. interest rates near record lows, many investors are turning to dividend stocks for income and growth.
A report on TheStreet.com’s Stockpickr service cites five companies that are likely to hike their dividends soon – Republic Services, Cintas, Maxim Integrated Products, Norfolk Southern, and ITC.
The factors that point to a dividend boost for these companies are strong balance sheets, low payout ratios, and a history of dividend increases, the report says.
Republic Services (Ticker: RSG) is the country’s second biggest waste management company. This industry is as resistant to recession as any.
Cintas (CTAS) is the nation’s dominant uniform rental firm. Continued economic recovery would give a boost to this cash-rich company.
Maxim Integrated Products (MXIM) makes mobile phone components, other communications hardware, and power management chips. It is able to offer customized products for its customers that some competitors can’t
Railroad titan Norfolk Southern (NSC) will benefit if commodity prices rise, as commodity producers would then have more money to spend on shipping. Norfolk Southern has a sterling balance sheet.
ITC (ITC) is an energy infrastructure firm providing transmission capacity to customers in the Midwest. These customers pay regular fees, providing a steady revenue stream.
Many market experts are now bullish on dividend stocks.
"They tend to outperform, and do it with lower volatility," John Buckingham, manager of the Al Frank Dividend fund, tells Associated Press. "For most investors, that's where you want to focus attention."
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