Investing in a dividend growth stock has a few great rewards. Of course, the most important is the increase in the dividend means more money in your pocket. When a dividend increase is announced, it signals to investors that a company awarded investors for a good few quarters and believe the next few quarters will be great for the company.
On February 21, Royal Bank of Canada reported their earnings. Royal Bank of Canada trades on both the New York Stock Exchange and Toronto Stock Exchange under the ticker symbol RY.
With this earnings report, Royal Bank announced an increase in their quarterly dividend from $1.05 to $1.08 per share, or from $4.20 to $4.32 per share annually. This represents an increase of 2.86%. This increase might seem small, but Royal Bank has been announcing dividend increases semi-annually for the past several years.
I own 56 shares of RY.TO inside my TFSA. This dividend raise increased my $6.72 to my annual dividend income.
During the last quarter, Bank of Nova Scotia (BNS) announced they will be going to annual dividend raises starting with Q2 earnings release in 2020. TD Bank (TD_has been doing annual dividend raises for the past several years. I believe the other 3 big 5 banks might change to annual dividend raises in the next couple of years.
Disclosure: Long RY, BNS, TD
Photo Credit : royalbank.com
I am not a financial planner, financial advisor, accountant or tax attorney. The information on this blog represents my own thoughts and opinions and should NOT be taken as investment or business advice.
Every individual should do their due diligence to make their own financial decisions based on their financial situation and tolerance for risk.