This Weeks Dividend Stocks

We're continuing 2011's trend for dividend performance in the past week, with 35 companies announcing increases in their payouts to shareholders. While that doesn't quite meet up to the 43 dividend increases we saw the previous week, it's important to remember that last week's number was the biggest instance of dividend increases in more than a year. If anything, the fact that dividends continue to be on the rise is an auspicious signal for investors because it suggests that companies are becoming confident enough in the current economic situation to part with their precious cash.

For income investors, that suggests an even bigger trend is in the works. History shows that when dividends rise, investors should pay attention. Over the last 36 years, dividend stocks outperformed the rest of the S&P 500 by 2.5% annually, and they outperformed nonpayers by nearly 8% every year, all while paying out cash to their shareholders, according to a study from NDR. And while that statistic applies to all companies that pay dividends, the companies that increase those dividend payouts over time are even better.

Source: The Street

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