3 Dividend Stocks That Recently Raised Payouts More Than 10%

If you're buying stocks for their dividend payments, it's important to focus on companies that also increase those payments. This can enable you to earn rising dividend income that offsets the effects of inflation. While dividend payments and increases are never a guarantee, as long as the businesses you invest in remain strong, it can be highly likely that the payouts will rise over the years.

Three dividend stocks that have already announced generous increases to their payouts this year are Walmart (NYSE: WMT), Thermo Fisher Scientific (NYSE: TMO), and Domino's Pizza (NASDAQ: DPZ). Here's a closer look at their yields, what their prospects are for rate increases in the future, and if they are good income investments to load up on right now.

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1. Walmart

On Feb. 20, Walmart announced it was increasing its dividend for the 52nd straight year. Not only is the streak impressive, but the recent increase is also a significant 13% bump up for the Dividend King. Walmart has been doing well amid varying economic conditions as net sales for its recently finished fiscal year (it ended on Jan. 31) rose by 5% to $674.5 billion. Operating income of $29.3 billion also rose by around 9%.

Walmart doesn't have a terribly high yield; even with the increase, it's paying investors about 1%, which is below the S&P 500 average of 1.3%. But with a modest payout ratio of just 34% and continued growth ahead for Walmart, there's little doubt that the big-box retailer will continue raising its dividend in the future.

If you're looking for a solid stock to just buy and hold for years and potentially even decades, Walmart can make for a great option to put into your portfolio. The business is doing well, and the dividend, although not terribly high today, can be an excellent source of recurring cash flow for the foreseeable future.

2. Thermo Fisher Scientific

Healthcare company Thermo Fisher Scientific also announced it was increasing its dividend last month. Its new quarterly payment of $0.43 will be 10% higher than its previous payout. Its streak isn't nearly as impressive as Walmart's, as the company has only been consistently bumping up its payout since 2018. And its yield is even lighter at just 0.3%. However, with a payout ratio of less than 10%, there can be many more dividend increases in the future for Thermo Fisher.

For dividend investors, the big appeal in investing with Thermo Fisher is the diversity the healthcare company provides. It's a provider of life sciences solutions, specialty diagnostics, laboratory products, and analytical instruments. Its growth hasn't been all that exciting, as revenue totaling $42.9 billion last year was flat from the previous year. But one underrated opportunity may be in the treatment of forever chemicals. Thermo Fisher offers testing solutions for per- and polyfluoroalkyl substances (PFAS), and that's a cleanup process that could involve hundreds of billions of dollars.

Thermo Fisher may not be the most exciting stock to own or even have a high yield. But it can provide some long-term stability and offer a good way to diversify your portfolio, plus the opportunities in the cleanup of PFAS could make it an intriguing investment option for the future.

3. Domino's Pizza

One stock that announced an even larger increase to its dividend than Walmart or Thermo Fisher is Domino's. Last month, it released its yearend results and announced a 15% increase to its payout. With the increase, Domino's is now yielding 1.4%. It has been consistently raising its dividend for more than a decade and still has a modest payout ratio of 36%. Domino's investors may expect the rate hikes to continue in the years ahead.

Domino's sales rose by around 5% last year, to $4.7 billion, while on the bottom line, net income jumped by more than 12% to $584 million. Same-store sales growth proved to be resilient as well, with U.S. stores experiencing a growth rate of 3.2% for the year while internationally the growth rate was a bit more modest at 1.6%, but still positive nonetheless.

This is another stock that can be a good buy for the long haul for the stability it offers and its continued growth, as Domino's is still eyeing more opportunities for expansion in the future.

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David Jagielski has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Domino's Pizza, Thermo Fisher Scientific, and Walmart. The Motley Fool has a disclosure policy.