Incremental Dividend

Definition of 'Incremental Dividend'


A series of regular increases to a corporation's dividend. Many large corporations choose to incorporate an incremental dividend policy because it illustrates the company's ability to continually increase the value to shareholders and is often a useful method used to maintain the interest of many income investors for the long run.

Investopedia explains 'Incremental Dividend'


For example, in 2004 the board of directors of Dominion Resources implemented a incremental dividend policy as a method of enhancing shareholder return.

It is important to note that any firm that fails to increase a dividend after it has a record of consecutive increases can experience a sharp sell-off because investors become apprehensive of when the dividend will be able to move up again.



comments powered by Disqus
Hot Definitions
  1. National Best Bid and Offer - NBBO

    A term applying to the SEC requirement that brokers must guarantee customers the best available ask price when they buy securities and the best available bid price when they sell securities.
  2. Maintenance Margin

    The minimum amount of equity that must be maintained in a margin account. In the context of the NYSE and FINRA, after an investor has bought securities on margin, the minimum required level of margin is 25% of the total market value of the securities in the margin account.
  3. Leased Bank Guarantee

    A bank guarantee that is leased to a third party for a specific fee. The issuing bank will conduct due diligence on the creditworthiness of the customer looking to secure a bank guarantee, then lease a guarantee to that customer for a set amount of money and over a set period of time, typically less than two years.
  4. Degree Of Financial Leverage - DFL

    A ratio that measures the sensitivity of a company’s earnings per share (EPS) to fluctuations in its operating income, as a result of changes in its capital structure. Degree of Financial Leverage (DFL) measures the percentage change in EPS for a unit change in earnings before interest and taxes (EBIT).
  5. Jeff Bezos

    Self-made billionaire Jeff Bezos is famous for founding online retail giant Amazon.com.
  6. Re-fracking

    Re-fracking is the practice of returning to older wells that had been fracked in the recent past to capitalize on newer, more effective extraction technology. Re-fracking can be effective on especially tight oil deposits – where the shale products low yields – to extend their productivity.
Trading Center