One Raise At A Time | Consistent Consumer Staples

Concept of how dividend growth investing works, health care, real estate
Getting a pay raise while sitting on the couch?  Sign me up!  Thanks Unilever for yet another dividend increase!
Something I love about dividend growth investing is that each month I get to hear about companies I own deciding to pay me more money in dividends.  Just for owning a small portion of said companies.  Not going and doing R&D for new products or technology.  Not selling any products.  Not managing any employees or inventory.  Not making sales calls.  All I had to do was have the foresight to invest some of my savings in excellent companies.  That's dividend growth investing at work!  I mean who doesn't like getting a raise for doing nothing?  Dividend growth investing is far from a get rich quick investment strategy, rather you need to remain focused on the long term goal to be successful.

On April 19th the Board of Directors at Unilever (UL) announced another dividend increase for shareholders.  The dividend was increased from 0.3585 euros up to $0.3872.  That's an excellent 8.01% increase.  Unilever is a Dividend Contender with 23 consecutive years of dividend increases.  Shares currently yield 3.48% based on the new annualized payout.

Since I own 30.2772 shares of Unilever in my FI Portfolio this raise increased my forward 12-month dividends by $4.27.  This is the 4th dividend increase I've received from Unilever since initiating a position in 2014.  Cumulatively, the organic dividend growth has totaled a whopping 43.9% over that time.  According to US Inflation Calculator the cumulative rate of inflation over that same time is 5.4%.

A full screen version of this chart can be found here.

Unilever has paid dividends to shareholders since at least 1962.  The dividend might not have been increased every single year; however, more often than not the raises have come.  Despite a few pauses in dividend growth, the dividend growth over longer periods of time have been very solid in the 5-10% range.

The 1-, 3-, 5- and 10-year rolling dividend growth rates since 1993 can be found in the following chart.  

A full screen version of this chart can be found here.

*2018's dividend assumes the new quarterly payout of $0.3872 per share is maintained for the rest of the year.

Wrap Up

This raise increased my forward dividends by $4.27 with me doing nothing.  That's right, absolutely nothing to contribute to their operations.  Based on my portfolio's current yield of 2.91% this raise is like I invested an extra $146 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.

So far in 2018 I've received 21 dividend increases from 20 of the companies in my FI Portfolio combining to increase my forward 12-month dividends by $173.51.  

My FI Portfolio's forward-12 month dividends increased to $6,122.02.  Including my FolioFirst portfolio's forward dividends of $79.16 brings my total taxable accounts dividends to $6,201.18.  My Roth IRA's forward 12-month dividends remain at $337.40.

Next week should be a busy week for dividend increase announcements with at least 3 raises likely to be announced.  

Do you own shares of Unilever?  What is your favorite sector when searching for dividend growth investments?

Please share your thoughts below.


  1. Hi JC, I own the PLC ADR shares. I'm always a little uncertain if the dividend increase announced in Euros translates through to these shares. Couple that with the currency fluctuation and I'm never exactly sure what I'm going to get. However, I have held UL for a number of years and the dividend payments have definitely increased over that period. Thoughts? Tom

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  3. One thing to note: companies only raise dividends when its a bull market and the economy is expanding. Dividends shrink when its a bear market and recession.


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