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These 3 growth stocks have fast-growing dividends

The great thing about growth shares is that they grow at a fast rate, which is of course why they’re called growth shares.

When one of these growth shares pays a dividend it’s normal for the yield to be lower than average because of the higher price/earnings ratio and the lower dividend payout ratio.

But, as the ‘growth share’ grows at a fast rate it is able to increase the dividend at a fast rate too, assuming the dividend payout ratio is kept the same. After a few years that growth share could be paying a good sum of money each dividend after double digit increases to the dividend during that time.

Here are three shares growing their dividends at a fast pace:

Bapcor Ltd (ASX: BAP)

Bapcor is Australia and New Zealand’s leading auto parts company. The company is growing at a very fast rate due to smart acquisitions it has made to boost the business in Australia and in New Zealand. Synergies are being recognised which are boosting margins.

The business is also experiencing good organic growth and expanding its networks, which is adding further revenue to the growth engine.

In its half-year report for the six months ending 31 December 2017, Bapcor increased the dividend by 27%.

Altium Limited (ASX: ALU)

Altium is one of the world’s leading electronic PCB software companies, giving engineers the tools to design the machinery and products of the future. Some of its top clients include NASA, BMW, John Deere and Lenovo.

The company is predicting that it will keep experiencing strong growth over the coming years as more and more products require greater technological input.

Altium grew its dividend by 18% in its recent report.

MNF Group Ltd (ASX: MNF)

MNF is the owner and operator of Australia’s largest voice over internet protocol network, according to the company.

Businesses are always looking to save on costs and offer a better service, so MNF’s offering has a lot of merit for companies in Australia and globally.

MNF increased its dividend by 14.7% in its latest report.

Foolish takeaway

At the current prices it’s hard to say that Altium would be a short-term good value buy, but both MNF and Bapcor could make good medium-term buys at the current prices.

These top stocks are also increasing their dividends at fast rates and are well worth researching.

Top 3 ASX Blue Chips To Buy In 2018

For many, blue chip stocks mean stability, profitability and regular dividends, often fully franked..

But knowing which blue chips to buy, and when, can be fraught with danger.

The Motley Fool's in-house analyst team has poured over thousands of hours worth of proprietary research to bring you the names of "The Motley Fool's Top 3 Blue Chip Stocks for 2018."

Each one pays a fully franked dividend. Each one has not only grown its profits, but has also grown its dividend. One increased it by a whopping 33%, while another trades on a grossed up (fully franked) dividend yield of almost 7%.

The names of these Top 3 ASX Blue Chips are included in this specially prepared free report. But you will have to hurry. Depending on demand - and how quickly the share prices of these companies moves - we may be forced to remove this report.

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Motley Fool contributor Tristan Harrison owns shares of Altium and Bapcor. The Motley Fool Australia owns shares of and has recommended Bapcor and MNF Group Limited. The Motley Fool Australia owns shares of Altium. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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