Starbucks Corporation (SBUX) will raise its quarterly dividend by 9.8 percent to 45 cents per share in 2020. This follows a 13.9 percent dividend increase to $0.41 per share in 2019 and will mark the 10th consecutive year of annual dividend increases by the specialty coffee company.

The next dividend is payable on November 27, 2020 to shareholders of record on November 12, 2020. A new annual rate of $1.80 per share yields 2.1% at a stock price of $85.92. The 5 year average dividend growth rate will drop from 20.7 percent to 17.6 percent annually for Starbucks.

In the company's press release dated September 30, 2020 Starbucks announces this dividend hike including a comment from CEO Kevin Johnson: “The Board’s decision to raise our quarterly dividend demonstrates confidence in the strength of our recovery and the robustness of our long-term growth model,” said Kevin Johnson, Starbucks president and ceo. “Our cash flow generation is strong, and we remain committed to reducing our financial leverage while continuing to invest for future growth,” concluded Johnson. Starbucks states that it has initiated its dividend in 2010 and has increased it in each of the past 10 years.

If we include this new dividend hike Starbucks will pay an estimated $2.1 billion in dividends annually to its shareholders. This year will mark the first time since 2011 that the company does not raise its dividend by double digits. Starbucks actually hiked its dividend by more than 20 percent for 8 consecutive years through 2018. Last year the dividend growth rate dropped to 13.9 percent followed by a 9.8 percent hike just announced for 2020.

Starbucks Corporation (Starbucks) is a roaster, marketer and retailer of specialty coffee. The company purchases and roasts high-quality coffees that are sold, along with handcrafted coffee, tea and other beverages and a variety of high-quality food items through company-operated stores. Starbucks also sells a variety of coffee and tea products and licenses its trademarks through other channels such as licensed stores, grocery and foodservice accounts. In addition to its flagship Starbucks Coffee brand, the company sells goods and services under the following brands: Teavana, Seattle’s Best Coffee, Evolution Fresh, La Boulange, Ethos, Starbucks Reserve and Princi. Starbucks Corporation was formed in 1985 and has paid a dividend every year since 2010.