3 Stocks With Mind-Boggling Double-Digit Dividend Growth

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Dividends are nice. But growing dividends are even better. These three stocks are not only increasing their dividends every year, but their most recent increases were up double-digit percentage points over last year's dividends.

These three companies are analog chipmaker Texas Instruments (NASDAQ: TXN), home improvement retailer Home Depot (NYSE: HD), and ski resort company Vail Resorts (NYSE: MTN). Here's how each company's dividend is growing by double digits, and why strong dividend growth is likely to continue.

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Texas Instruments

Paying dividends since 1962, Texas Instruments has a rich dividend history. Even more, the company's dividend has been increasing particularly rapidly in the last few years. Announced last month, Texas Instruments just increased its dividend by 24%. This extended the company's trend of high double-digit dividend growth rates in recent years; the semiconductor company has increased its dividend at an average compound rate of 22% over the past three years.

Of course, there's no guarantee every year will bring such a sharp dividend increase. But Texas Instruments' payout ratio of 47% (relatively low for a company with a 2.3% dividend yield and such strong dividend growth), along with its recent strong earnings growth (second-quarter EPS was up 30% year over year), make a strong case for more dividend growth ahead.

Home Depot

Thanks to strong revenue, earnings per share, and comparable-store sales growth in 2016, Home Depot was able to serve investors an impressive 29% increase in its dividend earlier this year. This brought the company's 3-year average annual dividend growth to 24%.

Looking ahead, Home Depot looks poised for more meaningful growth, supported by management's recent commitment to paying out a larger portion of its earnings, targeting a 55% payout ratio instead of 50%. Not only is Home Depot's payout ratio today just 45%, but earnings have continued to rise rapidly. EPS in Home Depot's second quarter was up 14% year over year.

Vail Resorts

Vail has seen the strongest dividend growth of these three stocks. Vail announced a 30% hike to its dividend in March, bringing its 3-year average annual dividend growth to a whopping 37%. The higher dividend was achievable thanks to strong earnings growth recently. EPS in Vail's fiscal 2016 (ending July 31, 2016) was up 31% year over year. And EPS in Vail's fiscal 2017 (ending July 31, 2017), was up 30% year over year.

Like Texas Instruments and Home Depot, Vail looks poised for more dividend growth in the years ahead. In the company's just-released fourth-quarter results for fiscal 2017, Vail said its season pass sales through Sept. 24 for the 2017/2018 North American ski season were up 17% in units and 23% in dollars compared to the comparable year-ago period.

All three of these dividend stocks look enticing -- Texas Instruments, Home Depot, and Vail Resorts. With meaningful dividends, strong dividend growth, and likely more meaningful dividend growth ahead, dividend stocks don't get much better than this.

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Daniel Sparks has no position in any of the stocks mentioned. The Motley Fool recommends Home Depot and Vail Resorts. The Motley Fool has a disclosure policy.