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Dividend Growth Stocks Poised for Increase, Says Trivariate CIO

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  Published in Stocks and Investing on Wednesday, April 8th 2026 at 15:42 GMT by CNBC
      Locale: UNITED STATES

Wednesday, April 8th, 2026 - The hunt for reliable income in a volatile market has led investors to dividend stocks, and one investment professional believes we're on the cusp of another period of increasing payouts. Adam Parker, Chief Investment Officer at Trivariate, recently shared his outlook on CNBC, highlighting dividend-paying companies with a history of consistent increases as prime candidates for portfolio inclusion.

Parker's strategy isn't simply about chasing high yields. He's focusing on dividend growth, identifying businesses not only willing to share profits with shareholders today but demonstrably capable of continuing - and expanding - those payments in the future. This approach is particularly appealing in the current economic climate, where the potential for both income and capital appreciation is highly sought after.

"We've been looking at dividend stocks, because I think we're going to see another round of dividend increases," Parker explained. This isn't a prediction based on wishful thinking, but on careful analysis of company fundamentals. He's looking beyond the current dividend yield and digging into factors like free cash flow, earnings potential, and payout ratios to assess sustainability.

Why Dividend Growth Matters Now

The appeal of dividend growth stocks extends beyond simple income generation. In a world of historically low interest rates (though rates have seen increased volatility in recent years, currently averaging 4.75% for 10-year treasuries as of early 2026), dividends represent a significant source of return. Furthermore, companies that consistently raise their dividends tend to be financially stable and well-managed, offering a degree of downside protection in market corrections. A growing dividend also signals confidence from the company's leadership regarding future profitability.

Trivariate's Top Picks & Underlying Logic

Parker highlighted three specific stocks as particularly promising, each representing a different sector:

• Duke Energy (DUK): As a utility company, Duke Energy is often viewed as a defensive play. Utilities provide essential services - electricity and gas - making them relatively insulated from economic downturns. This stability allows Duke to consistently generate cash flow, supporting its reliable dividend and providing the financial flexibility to potentially increase it further. The push towards renewable energy sources and infrastructure upgrades presents long-term growth opportunities for the company, further strengthening its dividend prospects.

• Bank of America (BAC): The financial sector has experienced a resurgence in recent years, fueled by rising interest rates and a recovering economy. Bank of America, in particular, has demonstrated improved profitability and capital strength. While historically sensitive to economic cycles, recent regulatory reforms and a more conservative lending approach have bolstered its resilience. Parker believes this improved financial health will allow Bank of America to return more capital to shareholders through increased dividends and share buybacks. The bank's expanding digital services and wealth management divisions also contribute to its long-term earnings potential.

• ExxonMobil (XOM): The energy sector has been a volatile one, but ExxonMobil's size and integrated business model provide a degree of protection. While the transition to renewable energy is underway, oil and gas will remain critical components of the global energy mix for decades to come. ExxonMobil has invested heavily in both traditional oil and gas production and renewable energy technologies, positioning itself to benefit from both markets. Higher oil prices, as experienced in 2024 and early 2025, directly translate into increased earnings for ExxonMobil, supporting its dividend payments. Furthermore, the company's commitment to cost discipline and capital efficiency enhances its ability to generate free cash flow.

Beyond the Headlines: What Investors Should Consider

While Parker's picks are a good starting point, investors should conduct their own due diligence before making any investment decisions. Key considerations include:

• Payout Ratio: This measures the percentage of earnings paid out as dividends. A high payout ratio may indicate that the dividend is unsustainable.
• Dividend Growth History: Look for companies with a consistent track record of increasing dividends, ideally over a period of at least 10 years.
• Financial Health: Evaluate the company's balance sheet, including debt levels and cash flow.
• Industry Trends: Understand the long-term outlook for the company's industry.
• Valuation: Ensure the stock is reasonably priced relative to its earnings and growth potential.

Dividend growth investing isn't about getting rich quick; it's about building a portfolio of high-quality companies that can generate a growing stream of income over time. Adam Parker's insights offer a valuable framework for identifying these opportunities, but thorough research and a long-term perspective are essential for success.