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September has historically been a challenging month for the stock market, making it a period when investors often look for ways to reduce portfolio volatility without giving up opportunities for growth. One strategy gaining attention is focusing on companies that consistently increase their dividend payments.

Morgan Stanley recently highlighted a group of companies that have demonstrated strong dividend growth over the past year. The investment bank screened the Russell 1000 for businesses that increased their dividends by at least 15% on a quarter-over-quarter basis during the previous 12 months. Such increases can be significant because growing dividends may indicate that a company has confidence in its future cash flow and financial position.

Dividend-paying stocks can provide investors with more than regular income. They may also offer some protection during periods of market uncertainty, particularly when valuations are elevated or interest-rate expectations are changing. Morgan Stanley strategist Todd Castagno has noted that dividends can provide a dependable income stream while also signaling management confidence.

Among the companies highlighted is East West Bancorp, a California-based banking company. The bank increased its quarterly dividend by 20 cents in January, bringing the payment to 80 cents per share. Its shares have also performed strongly in 2026, gaining about 16%.

East West Bancorp delivered better-than-expected second-quarter results in July. The company reported earnings of $2.63 per share on revenue of $791 million, slightly exceeding analysts' expectations for earnings of $2.61 per share and revenue of $785.5 million. Management also raised its forecast for full-year net interest income growth to between 7% and 9%, compared with its previous range of 6% to 8%.

Analyst sentiment toward the bank has remained positive, with most analysts covering the stock assigning a buy or strong-buy rating. Its dividend yield was around 2.4% at the time of the report.

Another company on Morgan Stanley's list is Packaging Corporation of America, which operates in the packaging industry. The company increased its quarterly dividend by 20% in May, bringing its annualized payment to $6 per share. The stock had gained roughly 15% during 2026 and offered a dividend yield of approximately 2.5%.

Analysts have also maintained a relatively constructive outlook on the packaging company, with more than half of those covering the stock rating it a buy or strong buy. Consensus price targets indicated additional potential upside.

The third highlighted company is Devon Energy, an oil and natural gas producer that has benefited from stronger energy prices. Morgan Stanley identified Devon as a preferred exploration and production company as oil prices approached the $100-per-barrel level.

Devon's dividend growth has been particularly notable. In May, its board approved a 33% increase, taking the quarterly payment to 32 cents per share. The stock had climbed approximately 31% year to date and carried a dividend yield of around 2.3%.

Analyst sentiment was especially strong for Devon, with 27 of 30 analysts covering the company rating it a buy. Their average price targets suggested significant additional upside.

Morgan Stanley's broader screen also identified several other well-known companies with a record of increasing dividends, including Nvidia, Royal Caribbean and Capital One Financial.

For investors, the appeal of these companies goes beyond the dividend yield alone. A growing dividend can potentially provide a combination of recurring income, shareholder returns and evidence of financial strength. However, dividend growth should not be viewed as a guarantee of future performance. Investors should also consider valuation, earnings growth, debt levels, industry conditions and the sustainability of a company's cash flow.

With markets facing uncertainty around interest rates, Treasury yields, energy prices and economic growth, dividend growers could remain an attractive area for investors seeking a balance between income and potential capital appreciation.

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