As Q1 earnings season begins to come to a close, several companies are making big statements to shareholders, committing to return substantially more capital. Three stocks that recently reported earnings have announced dividend increases of at least 10%. This shows a particular commitment to returning capital.
Not only are these increases large, but unlike share buybacks, once companies declare dividends, they must pay them. That stands in stark contrast to using buybacks to return capital. A company could theoretically announce the largest buyback program of all time, but it is under no legal requirement to actually spend the cash.
Another strong point of note is that all these names also have dividend yields that exceed the 1.2% yield of the S&P 500. Let’s dive into the details of these three names and their recent dividend boosts. All indicated dividend yield figures and other metrics use data as of the May 23 close.
Ralph Lauren: Clothing Maker Announces Big-Time Dividend and Buyback Increases
First up is a company whose products many have likely encountered at one time or another, Ralph Lauren (NYSE: RL). In addition to releasing a solid earnings report on May 22 that saw shares rise by around 1.3% afterward, Ralph Lauren also increased its quarterly dividend by 10%.
[content-module:DividendStats|NYSE: RL]The dividend will now be worth just over $0.91 per share, equating to an annual dividend of $3.65. Ralph Lauren expects to pay its next quarterly dividend on July 11 to shareholders of record at the close of business on June 27. This now gives the stock an indicated dividend yield of just over 1.3%.
In addition to the dividend increase, the company also announced a large increase to its share buyback capacity of $1.5 billion. This adds to the remaining buyback capacity under its previous program of $352 million. Now, this total buyback capacity of over $1.8 billion equates to approximately 11.2% of the company’s $16.5 billion market cap.
Although there are no guarantees that the company will use this buyback capacity, recent trends indicate it will. The company spent $425 million on buying back its Class A common stock in fiscal 2025, which ended in March. The size of this buyback program gives the company a substantial ability to influence its earnings per share (EPS) upward.
Equitable: Achieves $1 Trillion Landmark, Boosts Dividend Nearly 13%
Next up is the financial services company Equitable (NYSE: EQH). The company provides various wealth management, insurance, and retirement planning services.
[content-module:DividendStats|NYSE: EQH]It has become an increasingly large player in this space, seeing its stock price rise by approximately 95% over the last three years.
Despite posting results that moderately disappointed markets in Q1, the company achieved a significant milestone of $1 trillion in assets under management and administration.
At its annual meeting of shareholders on May 21, the company announced a large 12.5% increase to its quarterly dividend. The next $0.27 dividend will be payable on June 9 to shareholders of record at the close of business on June 2.
Overall, this gives the stock a notable dividend yield of nearly 2.1%. Additionally, over the last four quarters, Equitable has spent a little more than $1 billion on share buybacks. This has reduced the company’s share count by about 7%.
Northrop Grumman: Extends Dividend Increase Streak Amid B-21 Bomber Set Back
Last up is Northrop Grumman (NYSE: NOC). This defense company recently took a big post-earnings hit, dropping nearly 13% after its April 22 release. The company missed sales estimates by around 5% and missed adjusted EPS estimates by 47%.
[content-module:DividendStats|NYSE: NOC]The huge profit miss was because the company had to take a massive $477 million pre-tax loss on its B-21 stealth bomber program. The company altered its manufacturing process to streamline production going forward, causing costs to rise. Essentially, the company had to revise its cost estimates for producing the B-21, which led it to recognize a significant loss under accounting rules.
Despite this, Northrop Grumman announced a 12% increase to its quarterly dividend. The next $2.31 dividend is payable on June 18 to shareholders of record as of the close of business on June 2.
This marks 22 straight years of annual dividend increases for the firm. Now, the company’s indicated dividend yield sits just under 2%.
All in all, seeing these names boost their dividends by such large amounts adds significant credence to their commitment to returning capital to shareholders. Equitable’s very impressive increase of 12.5% and its generous use of buybacks particularly stand out.
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