AVP Avon Products Inc

Avon Products Inc. (AVP) raised its quarterly dividend 4.5%, making the beauty-supply maker the latest in a stream of companies that have spent more on investors and other projects after stockpiling cash during the recession.

Shares of Avon were up 1.7% to $28.90 in afternoon trading. The stock is off 11% over the past year.

The dividend boost, from 22 cents to 23 cents a share, will cost the company an extra $4.29 million a quarter based on 429 million shares outstanding.

Avon has posted stronger sales and margins of late as the personal-care sector has rebounded and become a hotbed of acquisition activity. The company made some purchases of its own last year to complement its core direct beauty-sales business, even as it was itself the subject of acquisition talk.

-By Drew FitzGerald, Dow Jones Newswires; 212-416-2909; Andrew.FitzGerald@dowjones.com