Most income-oriented investors focus almost exclusively on the current dividend yield of stocks to decide whether to purchase them. However, the payout ratio and the growth prospects of the company are equally important, as they are the determinants of future dividend growth. In this article, we will discuss the prospects of three stocks with solid dividend growth records, promising growth prospects and exceptionally low payout ratios. These dividend stocks have the potential to grow their dividends quickly for several years.
These dividend stocks have exceptionally low payout ratios and are poised for more growth. Parker-Hannifin (PH): As a Dividend King with a payout ratio of just 28%, PH stock will likely provide increasing dividends for many years. Williams-Sonoma (WSM): Given its rock-solid balance sheet and low payout ratio, WSM stock is a good pick for dividend growth potential. H.B. Fuller (FUL): The company has grown its dividend by an average of 7.5% over the past five years.
Source: InvestorPlace
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