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High-yield dividend stocks are a favorite among investors for good reasons. They provide a steady income stream and offer a promising avenue for total return. Total return is a comprehensive measure of investment performance that encompasses interest, capital gains, dividends, and distributions realized over time.
For example, if you buy a stock at $20 that pays a 3% dividend, and it goes up to $22 in a year, your total return is 13%. That is, 10% for the increase in stock price and 3% for the dividends paid.
When selecting stocks for their portfolios, one critical aspect for growth and income investors is the safety and security of a company's dividend and the prospect of the dividend being increased regularly. We decided to screen top blue-chip companies, looking for those that will be increasing their dividends not only this year but beyond.
We then narrowed down our screen looking for a high-yield home run that is likely to raise the dividend payouts to shareholders in 2024, and found one top company could have a dividend increase right around the corner. Investors looking for top dividend-paying companies should also grab this free report today .
Altria has a rich heritage as a U.S. company
One of the world's largest tobacco companies, Altria Group Inc. ( NYSE: MO ), sells and markets one of the world's biggest and most popular cigarette brands, Marlboro. The company noted this on the corporate website:
In 1929, when Philip Morris & Co.'s leaders selected Richmond, Va., as their new manufacturing hub, they didn't realize their focus on quality would help the company sell more than half of all cigarettes in the United States. Our focus on quality and consumers has helped make us the leader in the tobacco industry for more than 40 years.
In 2003 Phillip Morris Companies is renamed
Known since 1929 as the Phillip Morris Company, the company changed its name to the Altria Group in 2003 and remained the parent company for Kraft Foods Inc., Phillip Morris International, Philip Morris USA, and Philip Morris Capital Corporation.
By 2007, the company spun off Kraft Foods, distributing all of the shares to Altria shareholders. In addition, the company acquired John Middleton the same year, which makes and markets large machine-made cigars and pipe tobacco.
The company grows again in 2009 
In 2009 Altria acquires UST Inc., which was a holding company that made moist smokeless tobacco products through the U.S. Smokeless Tobacco Company and premium wines through Ste. Michelle Estates. This strategic expansion widened the company's product lines as cigarette sales slowed.
Altria sells stake in Anheuser-Busch InBev
After the Bud Light public relations disaster, the company decided to sell some of its massive position in the brewing giant. Altria used to own over 10% of Anheuser-Busch InBev S.A. ( NYSE: BUD ), the world's largest brewer.
Earlier this year the company sold 35 million of its 197 million shares through a global secondary offering. That represents 18% of their holdings but still leaves a hefty 8% of the outstanding shares in their back pocket. The company also announced a $2.4 billion stock repurchase plan partially funded by the sale.
Altria could raise the dividend in August
Altria Group has increased its dividend every year since 1970, making the company a member of the exclusive Dividend Kings . The current dividend yield is a generous 7.93%. In the past five years, management has lifted the dividend by an average of 5% annually.
Based on published reports Altria Group usually announces quarterly dividend raises in August, but the board of directors has the discretion to decide on future payments. Here is the upcoming dividend schedule for the stock.
- Declaration date: August 22, 2024
- Ex-dividend date: September 16, 2024
- Record date: September 16, 2024
- Payment date: October 10, 2024
Altria is a solid long-term high-yield dividend winner
As one of the very few blue-chip high-yield dividend stocks, Altria should continue to be a core holding for investors seeking large and dependable passive income streams. While cigarette smoking has plummeted in the United States over the last 40 years, it still remains popular, especially in Asia, Indonesia, and parts of Europe. Shareholders should continue to be richly rewarded with solid total returns, especially when interest rates start to decline and high-yield dividend stocks return to prominence.
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