Saturday, May 12, 2012

Ka-Ching! Intel Corp. just gave me a 7% raise

On Monday, May 7 Intel Corp. (INTC) said it's increasing its quarterly dividend by 7%. The world's largest chipmaker said shareholders will receive a dividend of 22.5 cents per share every quarter, or 90 cents per share on an annual basis, beginning in the third quarter.

7% is a decent bump, but what makes this special is how frequently INTC has been increasing its dividend.  Typically companies will raise dividends on an annual basis, but INTC has gone above and beyond this norm and has rewarded investors with three payout boosts in the past two years.  And considering INTC's 5 year dividend growth rate is almost 15%, this is likely not the last increase we will see this year.  

These increases are an excellent sign that management believes continued growth is ahead for the company.  In fact, CEO Paul Otellini remarked, “2012 is expected to be another year of record revenues for Intel, with strong demand in our core business and significant progress in smartphones and other new growth areas.”  Clearly they are putting their money where their mouth is by rewarding investors with a nice little raise.  I'll admit that I will be a little disappointed if INTC doesn't increase the payout again this year.  Of course, a 7% raise is nothing to sneeze at either.

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