In a week that saw major US indexes fall to fresh multi year lows, there is a group of investors who still remain optimistic. No, this is not a scam touting penny stocks that would bring instant riches. It’s also not a post about some computerized technical analysis program that will turn stones into diamonds.
The strategy is called dividend growth investing, and it is the fundamental way of picking shareholder friendly stocks, which reward their owners with an increasing stream of dividend income. Some of the best dividend stocks are included in the Dividend Aristocrats index, which has outperformed the S&P 500 over the past 5, 3 and one years. Despite some setbacks in 2009 like the cuts from Pfizer (PFE) and State Street (STT), the number of solid companies increasing dividends keeps rising.

The Sherwin-Williams Company (SHW), which engages in the development, manufacture, distribution, and sale of paints, coatings, and related products, boosted its dividends for the thirty first consecutive year. The new dividend increase was rather modest, from 0.35 to 0.355/share and much smaller than the ten year average. Given the tough housing market however, I consider this dividend increase at a time when CEO’s are cutting dividends to preserve cash for projects that won’t yield much, a big dedication to long-term shareholders. The stock currently yields 3.10%. Check out my analysis of SHW.

Integrys Energy Group (TEG), which operates as a regulated electric and natural gas utility company in the United States and Canada, increased its quarterly dividends payment to $0.68/share, which marked the fifty first consecutive year of increased payouts.