New businesses ready to fuel their dividends

Article Excerpt

These two U.S. telecom companies continue to use acquisitions to expand the profitability of their online and mobile businesses. That strategy adds risk, but it should also let them continue to expand their dividends. AT&T INC. $33 (New York symbol T; Income-Growth Dividend Portfolio, Utilities sector; Shares outstanding: 6.1 billion; Market cap: $201.3 billion; Dividend yield: 5.9%; Dividend Sustainability Rating: Highest; www.att. com) is the largest wireless carrier in the U.S. It also offers traditional phone and satellite TV services. With the February 2017 payment, AT&T increased its quarterly dividend by 2.1%, to $0.49 a share from $0.48. The new annual rate is $1.96 and yields a high 5.9%. The company continues to make progress with its acquisition of Time Warner Inc. (New York symbol TWX). That communications giant owns cable channels HBO and TBS, and the Warner Brothers movie studio. The company plans to use Time Warner’s exclusive content to attract more customers who want to stream video on their smartphones and…