No matter what kind of company we invest in, we all want to see our money grow. Bank deposits pay a set amount of interest, but it would take a very long time to get rich that way.
Getting a decent dividend gives you income as you wait for the stock to go up in price. Some stocks offer dividend yields that rival or beat what bank accounts can offer.
Dividends usually increase as company earnings rise, which gives you greater returns based on what you originally paid for the shares.
Here are four companies that have growing earnings and good dividend yields.
Flight Centre Travel Group Ltd (ASX: FLT) has been growing underlying net profit for the past four years. The well-known flight reservations and holiday bookings service provider is the biggest in its industry.
Dividend yield is 2.73% and the total annual dividend has almost doubled in the last three years thanks to attractive earnings growth.
National Australia Bank Ltd (ASX: NAB), one of the Big Four banks, saw a healthy 9.2% gain in underlying net profit in FY2013 and paid a total dividend of $1.90 per share for the year.
It is offering a 5.51% dividend yield, which may be higher than what a regular bank deposit offers in interest.
Insurance Group Australia Limited (ASX: IAG) is the market leader in general insurance with such brands as NRMA and CGU. Its net profit more than doubled in FY2013.
Its total dividend doubled as well, from 17 cents per share in FY2012 to 36 cps. Its current dividend yield is a lovely 6.93%.
APA Group Limited (ASX: APA) owns and manages extensive gas pipelines and distribution networks. It transports over half of all the gas used in Australia. It has an attractive dividend yield of 5.43%.
Underlying net profit has grown annually over the past nine years and so have total dividends. It will benefit from the LNG export industry as more gas resources are developed and sold overseas.
Foolish takeaway
Plan your investments for future growth and benefit from dividends paid out each year. If you are a long-term investor, you may not sell stocks for a number of years as you watch them grow. The dividends help reward patient shareholders.
