Several companies have been delivering positive news to shareholders lately, including announcements of higher dividend payouts.
A company opts to raise its dividend when confident in its current standing and cash-generating abilities.
Of course, it also reflects the company’s commitment to returning value to shareholders, which is undoubtedly encouraging.
Three companies — Advanced Drainage Systems WMS, Taiwan Semiconductor TSM, and Northrop Grumman NOC — recently declared dividend hikes. For those with an appetite for income, let’s take a closer glance at each.
Taiwan Semiconductor
TSM posted better-than-expected results in its latest release, exceeding the Zacks Consensus EPS estimate by nearly 7% and posting sales 2.7% ahead of expectations. Earnings grew 5% year-over-year, whereas revenue jumped 13% from the year-ago period amid hot demand.
Shares popped following the release, adding to already impressive year-to-date gains. Up 50% in 2024, shares have widely outperformed relative to the S&P 500.
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The company announced a 10% boost to its payout, bringing the quarterly total to $0.45/share. TSM’s commitment to increasingly rewarding shareholders has kept it a favorite among income-focused investors seeking technology and semiconductor exposure.
Advanced Drainage Systems
WMS shares have also delivered a considerably strong performance in 2024, gaining 22% in value compared to the S&P 500’s 12% gain. Better-than-expected results have aided the move, with the company exceeding the Zacks Consensus EPS estimate by an average of 30% across its last four releases.
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The company recently unveiled a 14% boost to its quarterly payout, bringing the quarterly total to $0.16/share. WMS has long displayed a shareholder-friendly nature, boasting a 12% five-year annualized dividend growth rate.
In addition, WMS is expected to continue its steady growth, with Zacks Consensus estimates suggesting 5.6% earnings growth on 5% higher sales in its current fiscal year (FY25). Peeking ahead to FY26, consensus expectations presently allude to a further 17% expansion in earnings paired with a 7% sales climb.
Northrop Grumman
Defense titan Northrop Grumman recently unveiled a 10% boost to its payout, upping the quarterly total to $2.06 per share. NOC shares haven’t fared as well year-to-date, down roughly 4% and underperforming relative to the general market.
Zooming out further, NOC shares have lagged the S&P 500 over the last two years, down 2.2% compared to a 33% move from the S&P 500. Still, the company has been seeing positive earnings estimate revisions for its current fiscal year, providing fuel for shares to move higher.
It’s reasonable to expect NOC shares to see a turnaround story if positive earnings estimate revisions continue to hit the tape.
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Bottom Line
Dividends soften the blow from drawdowns in other positions, provide more than one way to reap a return from an investment, and allow maximum returns through dividend reinvestment.
And all three companies above – Advanced Drainage Systems WMS, Taiwan Semiconductor TSM, and Northrop Grumman NOC – have recently boosted their payouts.
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Northrop Grumman Corporation (NOC) : Free Stock Analysis Report
Advanced Drainage Systems, Inc. (WMS) : Free Stock Analysis Report
Taiwan Semiconductor Manufacturing Company Ltd. (TSM) : Free Stock Analysis Report
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
