My favorite signal that a company can afford its dividend is a payment increase. Earnings can mislead, cash flow can be volatile and even a long history of payments means little if a business is deteriorating, but few managers would boost their dividends without reason to believe they can keep the payments coming in future years.

The good news for investors is that cash balances for S&P 500 companies have never been bigger, and paltry returns on short-term deposits are persuading formerly stingy companies to part with cash. Starbucks (SBUX) now yields 1.5% after initiating a payment in March. Below are three S&P 500 members that yield at least 2% after boosting payments in April by nontrivial amounts.

International Business Machines

Dividend increase (annual rate): from $2.20 to $2.60
Yield: 2%

International Business Machines, with a stock market value of just over $160 billion, returned more than $60 billion to stockholders over the past five years through dividends and share repurchases. The company focuses on high-end computing equipment and services, which keeps its margins large and steady. Over the past year, IBM turned 20 cents of each sales dollar into operating profit, about double the average for computer hardware makers. Much of its income comes from recurring services. The company's current services backlog is worth more than $130 billion; over the past year, IBM's total sales were about $97 billion. Wall Street expects the company to increase its earnings by 13% this year. Considering those numbers, the stock price seems modest at about 11 times forecast 2010 earnings.

The J.M. Smucker Company

Dividend increase: from $1.40 to $1.60
Yield: 2.7%

The J.M. Smucker Company tries to return 40% of its profits to stockholders. Profits have been strong of late -- adjusted earnings per share rose 34% in the company's most recent quarter -- which explains the dividend boost. The company has gotten much leaner in recent years. Profits per employee have risen to $57,000 from $35,000 since 2005. Under a recently announced plan, Smucker will consolidate production of its fruit spreads, ice cream toppings, syrups and coffee products into fewer and more modern plants, resulting in a layoffs of 15% of its work force, and annual savings of $60 million, or more than 10% of recent yearly profits.

Entergy

Dividend increase: from $3.00 to $3.32
Yield: 4.1%

Entergy owns a half-dozen regulated electric utilities and 12 nuclear units in the Northeast, making it the nation's second-largest nuclear power producer. New York regulators recently squashed the company's plans to spin off the nuclear business, which might work out just as well for investors. The utilities provide steady cash flow but little growth, and would likely suffer if Congress were to create a carbon tax. The nuclear business is less predictable but has more growth potential, particularly if electricity prices rise or Congress begins taxing carbon. Together, the two businesses should provide income investors with reliable payments and potential for future increases.

Correction: A previous version of this article misstated the new dividend rate for J.M. Smucker. It's $1.60 a year, paid quarterly.