In the depths of the financial crisis in late 2008, shares of tobacco maker Lorillard (NYSE: LO) were struggling as much as any other blue-chip stock.

That summer, shares slid from around $20 to nearly $15 by autumn, and few had the guts to step in and catch that falling knife. Still, the $1.56 a share dividend must have tempted some investors, as the dividend yield briefly moved above 10%.

Five years later, those intrepid few are very pleased indeed, as Lorillard’s dividend now stands at $2.20 a share. That works out to be a 14% current yield on that 2008 share price, which nicely complements a nearly 200% rebound for the stock.

And this tobacco maker has company. Lorillard is one of a handful of companies that have boosted their dividends by an average of at least 17% in the past three years.

Investors are increasingly focusing on these kinds of companies, as they tend to keep boosting their dividends at an aggressive pace. Take a look at the top dividend boosters over a five-year span. Many of the three-year winners make the grade here as well.

In fact, it should come as no surprise that the most robust dividend hikers over the past few years are also among the companies with the most impressive dividend growth over the past decade. Year in and year out, these companies have been returning more cash to shareholders. If you managed to buy any of these stocks a decade ago, you should be quite pleased.

Looking ahead, it’s fair to wonder if these dividend champs can remain atop the leaderboard. After all, as I’ve noted, some of them, such as L Brands (NYSE: LTD), are already bumping up against fairly high payout ratios, which means that dividends will likely only grow at the rate of earnings growth.#-ad_banner-#

Yet some of these stocks surely have what it takes to stay at the forefront of the dividend arms race. I took a deeper look at the companies noted on the tables above, seeking out companies with reasonable payout ratios and solid earnings growth prospects. A few names stand out.

Archer Daniels Midland (NYSE: ADM)
Prior to the financial crisis of 2008, this leading agricultural giant was clearly committed to steady and strong dividend growth. Yet over the past half decade, the company has seen its growth sharply slow as key divisions such as ethanol production generated lousy financial returns. 

Yet as I’ve noted, ADM is becoming a favorite of Warren Buffett‘s. And Buffett is known for his focus on companies with rising cash flow prospects. How do we know ADM is poised for rising cash flow? Because the company just started paying more attention to its dividend, boosting it by more than 20%, its largest increase in a decade.

ADM Dividend Growth Rate

Source: Thomson Reuters

Analysts at Merrill Lynch predict that ADM’s net income will be flat in 2013, but they foresee net income climbing 30% in 2014 and another 14% in 2015. Simply keeping the payout ratio constant would yield robust dividend increases. Yet ADM’s payout ratio, with the exception of 2012, has typically been around 20%. A hike in the payout ratio to 30%, coupled with the cash flow gains, could lead to 15% to 20% annual dividend increases for quite a while to come.

ADM Payout Ratio

Intel (Nasdaq: INTC)
This chipmaker has boosted its dividend at a double-digit pace in eight of the nine past years. What was once a 16-cent-a-share annual dividend in 2004 has grown into a dividend that is already up to 90 cents. Although profit growth remains fairly anemic, Intel has been earning more than $10 billion a year in each of the past three years. Assuming the company’s current $13 billion in net cash is more than sufficient to run operations, Intel can — and should — return excess profits to shareholders. Assuming a 75/25 split between dividend payments and share buybacks, Intel could afford to offer a dividend of $1.50 a share. 

Risks to Consider: Every half-decade or so, the economy spooks companies into holding the line on dividends, or even forces them to cut them, so don’t expect dividend growth to always take place in a linear fashion.

Action to Take –> If you are in search of companies capable of robust dividend growth, then take a look at the historical payout ratios. If income is now growing faster than the dividend, then the payout ratio has probably fallen and could soon be in for a freshening.

P.S. — If you want to know about one of the most effective dividend strategies around, then you have to find out about “The Dividend Trifecta.” Simply put, it’s a three-part approach to dividends that multiplies the effectiveness of every dollar you invest. The plan is specifically engineered for people who want to retire sooner or for those who would like to get a steady stream of extra income now. Go here to learn more…