6 Upcoming Dividend Increases Including a Dividend King: A Guide to Consistent Income and Growth

Companies with consistently increasing dividend payments are considered excellent long-term investments due to their strong financial health and stability. Dividend increases indicate a company's ability to generate substantial cash flow, providing both income and total returns for investors.

Dividend investing has emerged as a resilient strategy in 2025, gaining traction amid heightened market volatility and lingering uncertainties. While U.S. stocks continue to hover near record highs, buoyed by optimism around trade negotiations, robust corporate earnings, cooling inflation, and the AI-driven rally, investor sentiment remains clouded by geopolitical tensions and ambiguity surrounding the Fed’s next moves. Dividends offer a reliable stream of income, making them an attractive choice during uncertain times. Although they typically don’t deliver outsized price gains, dividend-paying stocks are known for stabilizing portfolios and outperforming in turbulent markets. Focusing on dividend growth rather than just yield can further enhance returns.

Companies with a consistent track record of increasing their payouts tend to be financially strong and offer better long-term capital appreciation. This strategy helps build a healthier, more resilient portfolio compared to chasing high-yield or one-off dividend payers. Five dividend growth stocks that could be solid choices for the second half of 2025 include Agnico Eagle Mines Limited (AEM), UGI Corporation (UGI), Qifu Technology Inc. (QFIN), Taiwan Semiconductor Manufacturing Company Ltd. (TSM), and Group 1 Automotive (GPI).

Why Dividend Growth?

Stocks that have a strong history of dividend growth belong to mature companies, which are less susceptible to large swings in the market and thus act as a hedge against economic or political uncertainty as well as stock market volatility. At the same time, these offer downside protection with their consistent increase in payouts. Additionally, these stocks have superior fundamentals that make dividend growth a quality and promising investment for the long term. These include a sustainable business model, a long track of profitability, rising cash flows, good liquidity, a strong balance sheet, and some value characteristics. Further, a history of strong dividend growth indicates that a dividend increase is likely in the future.

Although these stocks do not necessarily have the highest yields, they have outperformed for a longer period than the broader stock market or any other dividend-paying stock. Picking dividend growth stocks appears as a winning strategy when some other parameters are also included.

Key Criteria for Dividend Growth Stocks

1. 5-Year Historical Dividend Growth greater than zero: This selects stocks with a solid dividend growth history.
2. 5-Year Historical Sales Growth greater than zero: This represents stocks with a strong record of growing revenues.
3. 5-Year Historical EPS Growth greater than zero: This represents stocks with a solid earnings growth history.
4. Next 3-5 Year EPS Growth Rate greater than zero: This represents the rate at which a company’s earnings are expected to grow. Improving earnings should help companies sustain dividend payments.
5. Price/Cash Flow less than M-Industry: A ratio less than M-industry indicates that the stock is undervalued in that industry and that an investor needs to pay less for better cash flow generated by the company.
6. 52-Week Price Change greater than S&P 500 (Market Weight): This ensures that the stock appreciated more than the S&P 500 over the past year.
7. Top Zacks Rank: Stocks having a Zacks Rank #1 (Strong Buy) and 2 (Buy) generally outperform their peers in all types of market environment.
8. Growth Score of B or better: Our research shows that stocks with a Growth Score of A or B when combined with a Zacks Rank #1 or 2 offer the best upside potential.

These criteria narrowed down the universe from more than 7,700 stocks to just 14. Here are five of the 14 stocks that fit the bill:

- Agnico Eagle Mines Limited (AEM): A gold producer with mining operations in Canada, Mexico, and Finland and exploration activities in Canada, Europe, Latin America, and the United States. It saw a positive earnings estimate revision of 42 cents over the past 30 days for this year. The company has an estimated earnings growth rate of 52.5%.
- UGI Corporation (UGI): A holding company that distributes, stores, transports, and markets energy products and related services through its subsidiaries. It is a domestic and international retail distributor of propane and butane liquefied petroleum gases; a provider of natural gas and electric service via regulated local distribution utilities; a generator of electricity and a regional marketer of energy commodities. The stock has an estimated earnings growth rate of 2.29% for the fiscal year (ending September 2025) and delivered an average earnings surprise of 75.67% for the past four quarters.
- Qifu Technology Inc. (QFIN): A Credit-Tech platform principally in China that provides a comprehensive suite of technology services to assist financial institutions, consumers, and SMEs in the loan lifecycle, ranging from borrower acquisition, preliminary credit assessment, and fund matching to post-facilitation services. The stock saw a positive earnings estimate revision of a couple of cents for this year, with an estimated earnings growth rate of 25.62%.
- Taiwan Semiconductor Manufacturing Company Ltd. (TSM): The world's largest dedicated integrated circuit foundry. The company has seen a positive earnings estimate revision of 20 cents over the past 30 days for this year and has an estimated earnings growth rate of 34.66%.
- Group 1 Automotive (GPI): One of the leading automotive retailers in the world, with operations primarily located in the United States and the UK. The company saw a positive earnings estimate revision of 15 cents over the past month for this year and has an estimated earnings growth rate of 4.3%.

These companies are well-positioned to offer reliable dividend growth and are considered excellent long-term investments due to their strong financial health and stability.

References:
[1] https://finance.yahoo.com/news/5-dividend-growth-stocks-safe-150800695.html
[2] https://seekingalpha.com/article/4800930-travelers-companies-reliable-dividend-powerhouse-pc-insurance-sector