Exxon Mobil (NYSE:XOM) is a top dividend growth stock with a reputation for increasing its payouts for decades. The oil and gas producer has been benefitting from a strong price of oil over the past few years, setting it up for some massive gains. There remain, however, concerns about what the future may hold for the industry as consumers transition to electric vehicles and renewable energy sources.
Year to date, the stock is down 1% and over the past five years, it has risen by 34%. The S&P 500, by comparison, is up around 57% over the same stretch. But when you look at total returns, which include dividends, then the oil and gas stock’s performance is almost identical to the S&P as both it and the broad index are up around 70%.
Exxon has been a good dividend stock to own and today it yields 3.4%, which is more than double the S&P 500 average of 1.6%. Last October, the company increased its quarterly dividend by three cents to $0.91. It was a modest 3.4% increase but it was still better than in previous years where it increased its dividend by just a single penny. The stock was paying a quarterly dividend of $0.63 back in 2013, meaning that the payouts have grown by 44% over the past decade.
Later this month, Exxon Mobil is likely going to announce its next dividend payment. And given that the company is still doing well and its payout ratio is only around 30%, it seems probable that another dividend hike could be coming – but investors shouldn’t expect a huge one.
