Wednesday, May 19, 2010

A LOVELY afternoon for income......(CLX,DPS)


Dividend income that is...

Clorox (CLX) announced a pleasant increase to its dividend, increasing the quarterly payout to 55cents per share or $2.20 per year.  That brings the company's dividend yield to a very, very respectable 3.4%.

In bigger news, Dr. Pepper Snapple (DPS) boosted their payout 67% to 25cents per share quarterly, for an annual dividend yield of 2.6%...keep in mind this company only instituted a dividend two quarters ago.

These are bullish signs for these stocks.  In both cases, the dividend payout ratio is quite significant as a % of net income.  And I couldn't be more happy, as a hater of stock buybacks (the other main use of excess cash).  The one thing I would recommended people NOT do is reinvest these dividends  -->>  if the company had a use for that cash, they wouldn't be giving it back to you...

Copyright 2010 AlphaNinja

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