FedEx and 5 Other Stocks on Track for Double-Digit Dividend Growth

FedEx and five other prominent companies are poised to raise their dividends by more than 6% in the coming year, offering attractive opportunities for income-oriented investors. This article explores the historical trends, dividend payout ratios, key drivers, and long-term business strategies of these companies, providing insights into their potential for dividend growth.


1. **Historical Trend of Dividend Growth**: FedEx and its peers have consistently increased their dividends over the past five years. For instance, FedEx's dividend has grown at a compound annual growth rate (CAGR) of 10.5% since 2019. Other companies, such as AT&T and PepsiCo, have maintained dividend growth rates above 6% during the same period.


2. **Dividend Payout Ratios**: The dividend payout ratios of these companies compare favorably with their industry peers. For example, FedEx's payout ratio of 35% is lower than the industry average of 45%. This indicates that the company has room to increase its dividend without compromising its financial health.

3. **Key Drivers of Dividend Growth**: The primary drivers of dividend growth for these companies include strong financial performance, robust cash flow generation, and commitment to returning capital to shareholders. For instance, FedEx's dividend growth is supported by its strong cash flow generation and a commitment to maintaining a competitive dividend yield.

4. **Alignment with Long-Term Business Strategies**: The dividend policies of these companies align with their long-term business strategies. For example, FedEx's focus on investment in its network and technology infrastructure supports its dividend growth, as these investments drive long-term revenue growth and profitability.


In conclusion, FedEx and five other stocks are well-positioned for dividend growth in excess of 6% in the coming year. Their historical trends, competitive dividend payout ratios, strong key drivers, and alignment with long-term business strategies make them attractive options for income-oriented investors. As always, investors should conduct thorough research and consider their individual financial circumstances before making investment decisions.