The board of directors at Kellogg Company (K) recently declared a quarterly dividend of 49 cents per common share, up from 46 cents paid previously.

The 6.5% increase is in line with the cereals and snack company’s plans to hike dividend, announced in April, beginning third-quarter 2014.

The quarterly dividend is equivalent to an annual dividend of $1.96 per share, up from $1.84 paid previously. The new dividend will yield approximately 3.0% annually.

The increased dividend is payable on Sep 15, 2014, to shareholders on record on Sep 2.

Kellogg is also due to report its second-quarter results later this week.

In the second quarter, management expects to return to positive top-line growth after recording sales decline in the previous two quarters. The company expects volume trends to improve over the remainder of the year driven by significant increase in brand building investments.

Kellogg has strong commercial programs in place and plans to increase investments in core categories, with key programs scheduled to start in the second quarter. Moreover, price mix is expected to remain positive throughout the year.

However, adjusted operating profit is expected to decline slightly due to higher brand building investment. Brand building investments are expected to increase in a high single-digit range in the quarter, followed by further increase during the third quarter. Adjusted currency neutral earnings are expected to be approximately $1.02 per share, flat with the comparable last-year quarter.

Other Stocks to Consider

Kellogg currently carries a Zacks Rank #4 (Sell). Better-ranked food stocks include Treehouse Foods, Inc.(THS), Premier Foods plc (PRRFY) and Pinnacle Foods Inc.(PF). While Treehouse Foods sports a Zacks Rank #1 (Strong Buy), Premier Foods and Pinnacle Foods have a Zacks Rank #2 (Buy).

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