After falling by $43.8 billion in the first quarter of 2009, total quarterly dividend payments rebounded by $6.4 billion in Q1 of 2010 and another $19 billion during the first three months of 2011. In a recent Standard & Poor's news release, the company's senior index analyst, Howard Silverblatt, said, "If dividends were a paycheck, dividend investors would have received a 6.7% raise in the first quarter." However, Silverblatt does not believe that dividend levels will return to peak 2008 levels until 2013, so investors have much to look forward to during the next few years. (For background reading, see Dividend Facts You May Not Know.)

TUTORIAL: Stock Basics

Dividends Are Going Up
Dividend increases have been seen across the board in multiple industries as consumers return to the market and sentiment continues to improve. With strong operations and balance sheets, many companies are paying out more than $1 billion in dividends to their investors.

Billion-Dollar Payouts
(Nasdaq:INTC) raised its quarterly dividend by 15% to 18.12 cents as its board of directors authorized an additional $10 billion for share buybacks. In 2010, Intel paid out a total of $3.5 billion to shareholders. Fueled by a dividend increase and revenue guidance that exceeds analyst expectations, INTC has rallied by 15% in the last month.

JP Morgan Chase (NYSE:JPM) also had a significant increase in dividend income distributions, boosting its per-share payout from 5 cents to 25 cents. On a diluted share basis, this will increase the total expected quarterly payout to slightly over $1 billion. A $15 billion multiyear stock repurchase program was also authorized. CEO, Jamie Dimon hopes to see the dividend payout ratio increase to approximately 30%.

Procter and Gamble (NYSE:PG) has been paying dividends for more than 120 consecutive years and has been consistently increasing its payout at a compounded average rate of 9.5%. In April, another 9% increase was authorized as the company paid out $1.4 billion to investors.

Toward the end of 2010, Pfizer's (NYSE:PFE) board of directors authorized an 11% dividend increase, which marked the 289th consecutive quarterly payment. Pfizer returned $7.1 billion to shareholders last year and is currently targeting a 40% payout ratio to further enhance shareholders' wealth.

Diversified Dividend Growth
Other industries that saw major dividend increases included transportation, industrials and the utilities with J.B. Hunt (Nasdaq:JBHT), Home Depot (NYSE:HD) and Dominion Resources (NYSE:D) among the leaders within each of their respective groups. Naturally, the utilities are best known for their consistent payouts. Dominion intends to revise its previous payout ratio of 55% to approximately 65% to be more or less on par with its peers.

The Bottom Line
In order to find a sustainable dividend, investors will often have to turn to blue chip stocks. Although many of these companies don't offer the desired 10% yield, they have a long history of increasing dividend payouts and providing long-term capital gains. (For more hot dividend stock picks, see 5-Star Dividend Stocks.)

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