Income investors would ideally like to invest in companies that have sustainable dividends.
Unfortunately, no one can accurately predict the future, which makes estimating the future dividends of a company potentially tricky. One way to help clear up some of the fog would be to look at a company’s history of paying dividends.
Over the past 10 years, the global economy has been through some really rough times, with the great financial crisis being the most jarring episode. It would thus mean that a company that can grow its dividends in the past decade has a business that has some stability and sustainability in the past – and that could be a great starting point for further research.
Here, we will like to share with you five blue chip stocks which have managed to grow their dividend payouts by more than 50% within the last decade. The first three companies can be found in this article. For a quick recap, these companies are:
- Dairy Farm International Holdings Ltd (SGX: D01).
- ComfortDelgro Corporation Limited (SGX: C52).
- DBS Group Holdings Ltd (SGX: D05)
The next company on our list is Singapore Telecommunications Limited (SGX: Z74), more commonly known as SingTel, who is one of the three main telecommunication companies in Singapore.
Despite all the competition in the telecommunication industry (both local and overseas), SingTel has sustainably grown its dividend in the last decade. During this period, dividend per share (DPS) was up from 12.5 cents in 2008 to 20.5 cents in 2018. In term of percentage, this is up by 64% for the period.
At a current stock price of S$ 2.93 (as of writing), the company is trading at a dividend yield of 7.0%.
The last company that we will look at is Sats Ltd (SGX: S58).
As a quick introduction, Sats is a company providing food solutions and gateway services solutions. The Food Solutions covers airline catering, food distribution, industrial catering whereas Gateway Solutions is involved in ground handling services of passengers, flights and cargo.
Sats performed even better than SingTel in the case of growing its dividend during the last decade. During this period, Sats grew its dividend per share from 10 cents in FY 2008/09 to 18 cents in FY 2017/18, up by 80% during this period!
At a current stock price of S$4.66 (as of writing), Sats is trading at a dividend yield of 3.9%.
Income investors focusing on dividend investing might want to take a look at these companies mentioned, due to their track record of growing dividend returns during the last decade.
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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Lawrence Nga doesn’t own shares in any companies mentioned. Motley Fool has a recommendation for DBS Group Holdings Ltd, Sats Ltd, and Dairy Farm International Holdings Ltd.