Three Dividend Growth Stocks to Combat Inflation

Key Points

• Pharmaceutical giant Eli Lilly is driving dividend growth with its GLP-1 products and new drug approvals.

• Parker-Hannifin, a Dividend King, has increased its dividend for 71 consecutive years.

• Microsoft, a technological leader, consistently raises its dividend by 10% or more.

Eli Lilly’s revenue reached $19.8 billion in Q1 2023, a 56% year-over-year increase, with earnings per share (EPS) rising 156% to $8.55. The company recently increased its dividend by 15.3% to $1.73 per quarter. It has a payout ratio of 22.4% and is projected to generate $82-$85 billion in revenue by 2026, a 28% increase at the midpoint.

Parker-Hannifin reported record revenue of $5.5 billion in Q3 2023, an 11% annual increase, alongside an 18% rise in EPS to $8.17. The company announced an 11% dividend increase, reinforcing its status as a Dividend King after 70 consecutive years of increases. Its payout ratio stands at 26.6%.

Microsoft’s revenue for Q3 2023 was $82.9 billion, up 18% year-over-year, with EPS rising 23% to $4.27. The company raised its dividend by 10% to $0.91 per share, marking the 21st consecutive year of dividend increases. Significant growth in its cloud services sector reflects its strong competitive position.