Introduction: Understanding Total Returns
Dividend yields can certainly catch the eye of investors, but the true measure of a stock's success lies in its total return. Total return encompasses both the dividend yield and the fluctuations in the stock price. These two components can often move in contrary directions; when share prices dip, dividend yields rise, and the opposite holds true as stock prices climb.
In this article, we will discuss five stocks that are not only excelling in total returns this year but are also making notable strides in increasing their dividends. All five companies have recently declared significant dividend hikes of 10% or more, positioning them well in the market.
1. Comfort Systems: A Rising Dividend Champion
Comfort Systems (NYSE: FIX) recently announced a 10% increase to its quarterly dividend, raising it to $0.50 per share, payable soon to shareholders. Despite this notable increase, the company's dividend yield remains just below 0.3%. This low yield, however, reflects the company’s remarkable stock price surge of over 600% since the start of 2022.
Since early 2022, Comfort Systems has raised its dividend multiple times, with its quarterly payout nearly quadrupling, which clearly shows its commitment to returning capital to its shareholders. The impressive price appreciation combined with consistent dividend growth signals a strong long-term investment proposition.
2. Wingstop: Strong Growth Meets Dividend Increases
Wingstop (NASDAQ: WING) has been another favorite in 2025, showing a total return nearing 28%. Following their recent earnings announcement, Wingstop surprised analysts with better-than-expected adjusted earnings per share.
The company also declared an 11% increase in its quarterly dividend, contributing further to its favorable reputation. Over the last three years, the company has managed a compound annual growth rate of more than 16% in its dividends, exemplifying a strong pathway in dividend growth.
Even with a dividend yield a tad above 0.3%, Wingstop’s consistent dividend increases affirm its dedication to enhancing shareholder value. This blend of growth and income makes Wingstop a standout choice for long-term investors.
3. McKesson: A Reliable Dividend Provider
Healthcare giant McKesson (NYSE: MCK) also demonstrated its commitment to shareholders with a 15% increase in its quarterly dividend, which has now reached 82 cents per share. This increase will be effective for stockholders of record, showcasing the company's dedication to providing financial returns.
McKesson's recent performance shows a total return of approximately 23% in 2025. Remarkably, the company has maintained a steady 15% increase in dividends for four consecutive years, highlighting its financial robustness and steadiness.
McKesson continues to demonstrate its reliability as a long-term growth contender in the healthcare sector, even with a relatively modest yield. This consistency adds substantial long-term value for its investors.
4. Encompass Health: Gradually Climbing Back
Encompass Health (NYSE: EHC) has entered a recovery phase with a nearly 12% dividend increase, raising its quarterly payment to 19 cents per share. The dividend is set to be distributed to stockholders, giving them an indicated yield of 0.70%.
In 2025, Encompass has already seen a total return of more than 18%. After facing challenges with significant cuts in their dividend back in 2022, the company is now focused on gradually rebuilding confidence among investors.
The recent improvement in operational stability may lead dividends back to pre-2022 levels, making Encompass an attractive consideration for income-driven investors.
5. Welltower: A REIT with Impressive Returns
Finally, healthcare REIT Welltower (NYSE: WELL) increased its quarterly dividend by 10.4%, now at 74 cents per share. This stock stands out with the highest yield on our list, just under 1.8%.
While this yield may be low among large-cap U.S. healthcare REITs, Welltower achieved an impressive total return exceeding 33% in 2025. The market has responded positively to the company's improved fundamentals and a commitment to consistent dividend growth.
As Welltower continues to show strong price performance, the combination of dividends and share price appreciations creates a compelling value story for investors.
Conclusion: The Importance of Dividend Growth
These five companies are not just increasing their dividends but also enhancing their overall return potential. With noteworthy share price appreciation, these dividend boosts are crucial in maintaining a healthy yield while securing a meaningful portion of returns for investors.
In today’s market, the ability to provide consistent dividend increases can greatly influence an investment’s appeal, becoming a fundamental aspect of overall return profiles.
Frequently Asked Questions
What is total return in investing?
Total return considers both the dividend yield and share price appreciation or depreciation of a stock.
Why is dividend growth important for investors?
Dividend growth signals a company’s strong financial health and commitment to returning capital to its shareholders.
What makes these five stocks stand out?
These stocks have demonstrated substantial total returns and significant dividend increases, appealing to investors seeking growth and income.
How can one assess dividend sustainability?
Evaluating a company’s dividend history, payout ratio, and earnings growth can provide insights into sustainability.
Which sector do these stocks belong to?
These companies primarily belong to the healthcare sector and the services industry, indicating strong fundamentals and growth potential.
