Many dividend investors are under the mistaken impression that a company which can pay an increasing dividend each year should be able consistently increase dividends indefinitely. Unfortunately not all dividend increases are created equally.
In order for a company to be able to consistently increase a dividend, it fundamentally needs to grow operating earnings and operating cash flow. An inability to grow either of these over an extended period of time will ultimately impact the ability of a company to increase its dividend to shareholders.
It is still possible for a company to increase its dividend for quite some period of time even though operating earnings growth has stalled. A business can decide that it is going to pay out an increasing amount of its earnings in the form of dividends and just reinvest less in the business. In such a scenario, I view dividend growth as temporary and unlikely to continue over the long term.
You can read the rest of my article here on Seeking Alpha if interested.