Phillip Davidson: US companies beginning to increase their payouts

ON THE US

The first quarter of 2010 has rewarded income-oriented investors.

February was the best month for dividends in more than two years as 47 S&P 500 companies either raised their dividends or began paying one. This was a sea change for this set of stocks – dividends are recovering from 2009, the worst year on record in the US, where 804 companies reduced their payouts by a combined $58bn. Currently, consumer companies, such as household product providers, telephone companies, utilities and drugmakers, are providing some of the best opportunities for higher yields. Besides being an important part of total return, dividends play a central role in reducing ri...