American Water Works (AWK) will raise its quarterly dividend by 10.0 percent to $0.55 per share in 2020. This follows a 9.9 percent dividend hike by the water utility last year and marks the 12th consecutive year of dividend increases.

The increased dividend will be payable on June 2, 2020 to all shareholders of record as of May 12, 2020. The new annual dividend amount of $2.20 per share yields 0.8% at a stock price of $119.

“American Water is continuing to focus on providing an essential service during the COVID-19 health emergency, while also delivering on our core strategies to provide clean, safe, reliable and affordable water and wastewater services for our customers for the long-term,” said Walter Lynch, president and CEO of American Water in the company's press release on April 29, announcing the quarterly dividend. “We understand that a secure and growing dividend is important to our shareholders, while striking the right balance with continued investment in our regulated operations.”

In its press release AWK states that the increased dividend is consistent with the company's historical dividend practice, which is to align dividend increases with long-term earnings per share growth, and to provide for a target payout ratio between 50 to 60 percent of net income.

American Water Works Company, Inc. is a water and wastewater utility company.  The company conducts the majority of its business through regulated utilities that provide water and wastewater service. American Water also operates market-based businesses that provide complementary services. The company’s utilities provide water and wastewater services to residential, commercial, industrial, public authority, fire service and sale for resale customers. American Water has increased its dividend every year since its IPO in April 2008. The history of American Water Works Company dates back to 1886.