Dividend Growth Investing at Work - Ducks and Dividends
|Getting a pay raise while sitting on the couch? Sign me up! Thanks Aflac for another raise!|
On Thursday, October 27th the Board of Directors at Aflac, Inc. (AFL) announced another dividend increase. The new quarterly dividend payout is $0.43 compared to the prior payout of $0.41. That's a solid 4.87% raise. Aflac is a Dividend Champion with 33 consecutive years of dividend growth. Shares currently yield 2.51%.
Since I own 73.411 shares of Aflac in my FI Portfolio this raise increased my forward 12-month dividends by $5.87. This is the 4th dividend increase I've received from Aflac since initiating a position in early 2013. Cumulatively my income from Aflac has increased by 23%!!! According to USInflationCalculator the total rate of inflation over the same time period is 3.6%. While Aflac's dividend growth has been more of the slow and steady type it's far outpacing the rate of inflation.
A larger version of the chart can be found here.
Dividend growth has clearly slowed from it's heyday; however, the raises keep coming and a steady 5% raise is fine by me. Aflac is a bit of a different company wherein they do the majority of their business in 1 foreign country, Japan, yet are incorporated in the United States and convert everything back to the greenback for reporting. So a strong U.S. dollar hurts their results. But raises keep coming which keeps me happy while they figure out a way to grow and expand their supplemental insurance business.
My forward dividends increased by $5.87 with me doing nothing. That's right, absolutely nothing to contribute to their operations. Based on my portfolio's current yield of 3.06% this raise is like I invested an extra $191 in capital. Except that I didn't! One of the companies I own just decided to send more cash my way.
That's how you can eventually reach the crossover point where your dividends received exceed your expenses. That's DIVIDEND GROWTH INVESTING AT WORK! The beauty of the dividend growth investing strategy is that you build up your dividends through fresh capital investment as well dividend increases from the companies you own.
For a dividend growth investor there's not much better than hearing news of a dividend increase. So far this year I've received 46 increases from 37 companies increasing my forward 12-month dividends by $261.00.
My FI Portfolio's forward-12 month dividends increased to $5,403.21 and including my Loyal3 portfolio's forward dividends of $65.46 brings my total taxable account forward dividends to $5,468.68. My Roth IRA's forward 12-month dividends remain at $240.84.
Previous Raises this Month:
Omega Healthcare Investors (OHI)
Visa, Inc. (V)
AT&T, Inc. (T)
Chevron Corporation (CVX)
Expected Raises in October:
Do you own shares of Aflac?
Please share your thoughts below.
Image courtesy of digitalart on FreeDigitalPhotos.net.