Долгосрочные инвесторы в рост дивидендов знают силу терпения.
Лучшие дивидендные акции — компании, которые десятилетие за десятилетием увеличивают свои выплаты, как часы, — могут приносить превосходную общую прибыль, даже если их доходность явно посредственна. Регулярные увеличения дивидендов также повышают доход на основе первоначальных затрат инвестора. Продержитесь достаточно долго, и невпечатляющий доход в 1%, который вы получили от своих первоначальных инвестиций, может вырасти как на дрожжах.
И, как всегда, давайте не будем забывать о магии компаундирования. Как сказал Бен Франклин, "деньги делают деньги. А деньги, которые делают деньги, делают деньги".
Компании с долгой историей ежегодного роста дивидендов также предлагают некоторое спокойствие. Когда фирме удается год за годом увеличивать свои дивиденды, несмотря на рецессию, войну, рыночные обвалы и многое другое, она делает убедительное заявление как о своей финансовой устойчивости, так и о своих обязательствах перед акционерами.
Войдите в число дивидендных аристократов.
Дивидендные аристократы — это компании из индекса S&P 500, которые ежегодно повышали свои ежегодные выплаты в течение как минимум 25 лет подряд. Этот список лучших дивидендных акций S&P представляет собой смесь известных компаний и малоизвестных компаний, но все они играют ключевую роль в американской экономике. И хотя они разбросаны практически по всем секторам рынка, всех их объединяет одно:стремление к надежному и долгосрочному росту дивидендов.
Небольшое примечание:S&P Dow Jones Indices добавил три новых названия на 2021 год, заменив Raytheon (RTX), Carrier Global (CARR) и Otis Worldwide (OTIS) после выделения и поглощения, которые разрушили бывшую империю United Technologies.
Вот текущие 65 дивидендных аристократов, включая новых лиц, присоединившихся к группе. Следующие акции были одними из лучших дивидендных акций для роста доходов за последние несколько десятилетий, и они являются отличным стартом, если вы хотите добавить дивидендные боевые корабли в свои долгосрочные портфели.
Энергия NextEra (NEE) — недавнее дополнение к Аристократам. Коммунальная компания была добавлена в элитную группу производителей дивидендов в январе 2021 года.
Компания имеет два основных направления деятельности:Florida Power &Light (FPL) — крупнейшая электроэнергетическая компания Флориды, а NextEra Energy Resources — крупный игрок в сфере ветровой и солнечной энергетики. Аналитикам нравится такое сочетание успешной регулируемой коммунальной службы с быстрорастущим бизнесом по возобновляемым источникам энергии. Рост населения и акцент администрации Байдена на производстве возобновляемой энергии должны хорошо послужить компании.
В последний раз компания повышала дивиденды в феврале 2021 года, увеличив ежеквартальное распределение на 10% до 38,5 центов на акцию.
Международные бизнес-машины (IBM), компонент промышленного индекса Доу-Джонса, уже не так известен, как раньше. Доходы компании неуклонно снижались на протяжении большей части десятилетия из-за того, что она пользовалась успехом в таких важнейших областях роста, как социальные сети, мобильные устройства, аналитика и облачная инфраструктура.
И все же, несмотря на все свои промахи и спотыкания, Big Blue остается стойким сторонником дивидендов, получив членство в дивидендных аристократах в январе 2021 года.
В апреле 2021 года IBM повысила квартальные дивиденды на пенни до 1,64 доллара на акцию, отметив повышение 26-й год подряд. IBM выплачивает дивиденды ежеквартально с 1916 года. Важно отметить, что у компании есть ресурсы, чтобы поддерживать полосу роста, которая является характеристикой, которую вы ожидаете увидеть среди лучших дивидендных акций.
Альбемарль (ALB), которая производит специальные химикаты, такие как литий, в последний раз увеличила свои дивиденды в феврале 2021 года – на 1,3 % до 39 центов на акцию ежеквартально.
Продукция Albemarle работает полностью за кулисами, но ее химикаты работают в ряде отраслей, от технологий экологически чистого топлива до фармацевтики и пожарной безопасности. Но в основе бычьего дела лежит литий.
"Позитивный прогноз по внедрению электромобилей – ключевой фактор для ALB, и мы считаем, что существует дополнительный риск ускорения этой тенденции в условиях "голубой волны" в США – говорится в отчете CFRA Research.
Гусеница (CAT), крупнейший в мире производитель тяжелого строительного и горнодобывающего оборудования, присоединился к Dividend Aristocrats в январе 2019 г.
CAT выплачивает регулярные дивиденды в обязательном порядке с 1933 года и ежегодно поднимает свои выплаты в течение 27 лет. Совсем недавно компания увеличила дивиденды в июне 2021 года на 8 % до 1,11 доллара США в квартал.
Лучшие дивидендные акции имеют достаточный свободный денежный поток для покрытия дивидендов, и CAT легко ставит эту галочку. За 12 месяцев, закончившихся 31 декабря 2020 г., свободный денежный поток CAT после выплаты долга составил 1,97 млрд долларов после выплаты дивидендов на сумму 2,2 млрд долларов.
Доверительный фонд собственности Эссекса (ESS), добавленный в Dividend Aristocrats в 2020 году, – это инвестиционный фонд недвижимости (REIT), который инвестирует в квартиры в основном на Западном побережье.
REIT стал публичным в 1994 году и с тех пор увеличивает свои выплаты. Последнее увеличение произошло в феврале 2021 года, когда ESS увеличила квартальные дивиденды на 5 центов – до 2,09 доллара США на акцию.
Благодаря постоянному и щедрому увеличению дивидендов, Эссекс может похвастаться 10-летним разделенным темпом роста в годовом исчислении на уровне 101,2%. За 20 лет темпы роста дивидендов компании в годовом исчислении составляют почти 250%.
Expeditors International of Washington (EXPD) была добавлена к Aristocrats в январе 2020 года. В последний раз логистическая компания повышала свои полугодовые дивиденды в мае 2021 года до 58 центов на акцию с 52 центов на акцию.
Это были тяжелые несколько лет для транспортной компании. Торговая напряженность между США и Китаем во время предыдущей президентской администрации сильно ударила по EXPD. А теперь COVID-19 нарушил объемы авиаперевозок и морские контейнерные перевозки.
Тем не менее, несмотря на все это, EXPD оставалась приверженной своим полугодовым дивидендам, которые она увеличивала каждый год на протяжении более четверти века. Стабильно низкий коэффициент выплат должен гарантировать, что у Expeditors будет достаточно ресурсов, чтобы сохранить серию акций и сохранить свое место в списке лучших дивидендных акций.
Доход от недвижимости (O) — это REIT, на которую инвесторы могут рассчитывать в плане стабильного дохода, но у этих акций есть еще один аспект, который может подойти определенным доходным инвесторам:Realty Income — это редкая порода акций с ежемесячными дивидендами.
Компании принадлежит более 6700 объектов коммерческой недвижимости, которые сдаются в аренду более чем 630 арендаторам, включая Walgreens (WBA), 7-Eleven, FedEx (FDX) и Dollar General (DG), работающих в 58 отраслях.
Realty Income обычно генерирует предсказуемый денежный поток благодаря долгосрочному характеру аренды. С 1994 года компания продемонстрировала совокупный среднегодовой рост дивидендов на 4,3 %.
Последнее увеличение REIT, объявленное в ноябре 2021 года, увеличило ежемесячный дивиденд до 24,6 цента на акцию с 23,6 цента на акцию.
Чабб (CB) была добавлена к дивидендным аристократам в январе 2019 года. В последний раз страховая компания повышала выплаты в мае 2021 года до 80 центов на акцию с 78 центов. Благодаря этому шагу Chubb добился роста дивидендов 28 год подряд.
Являясь крупнейшей в мире публичной компанией по страхованию имущества и страхованию от несчастных случаев, Chubb ведет свою деятельность в 54 странах и территориях. Это не самая захватывающая тема для разговора за ужином, но это прибыльный бизнес, который приносит многолетние дивиденды.
И стабильный рост дивидендов Чабба со временем действительно увеличивается. Действительно, темпы роста дивидендов в годовом исчислении за 20 лет у страховой компании составляют более 134%.
People's United Financial (PBCT) — редкая банковская игра в этой коллекции дивидендных акций. Общая сумма активов региональной финансовой компании, которая управляет более чем 400 филиалами в Коннектикуте, Нью-Йорке, Массачусетсе, Вермонте, Нью-Гемпшире и Мэне, превышает 63 миллиарда долларов. Почтенное учреждение Новой Англии ведет свою историю с 1842 года.
В феврале 2021 года M&T Bank (MTB) заключил сделку по приобретению People's United Financial в рамках сделки с акциями на сумму 7,6 миллиарда долларов. Еще неизвестно, займет ли M&T место PBCT в списке дивидендных аристократов.
Последний раз PBCT повышала дивиденды в апреле 2021 года до 18,25 цента на акцию в квартал с 17,75 цента на акцию.
Вест Фармасьютикал Сервисес (WST) была добавлена к Dividend Aristocrats в январе 2021 года в знак признания ее почти трехдесятилетней череды ежегодных приростов.
WST работает в критическом секторе цепочки поставок в сфере здравоохранения, производя упаковочные компоненты и системы доставки для инъекционных препаратов и других медицинских изделий. Быки отмечают, что спрос на вакцины от COVID-19 повышает спрос на продукцию фирмы. Между тем, надежный портфель биофармацевтической отрасли должен поддерживать долгосрочный рост.
В последний раз фирма повышала дивиденды в октябре 2021 года, увеличив квартальную выплату на 5,9% до 18 центов на акцию. Достаточный свободный денежный поток и низкий коэффициент выплат должны убедить акционеров в том, что ежегодное увеличение дивидендов будет продолжаться.
Линде (LIN) стала Dividend Aristocrat в конце 2018 года после завершения слияния с Praxair, которая сама была добавлена в прославленный список S&P 500 лучших дивидендных акций для роста доходов в январе 2018 года. Объединение Linde и Praxair на сумму 90 миллиардов долларов создала крупнейшую в мире компанию по производству промышленных газов.
Praxair повышала дивиденды в течение 25 лет подряд до слияния, и объединенная компания продолжает стабильно выплачивать дивиденды. До слияния компания Linde со штаб-квартирой в Дублине ежегодно с 2014 года повышала дивиденды. Последнее повышение Linde произошло в январе 2021 года, когда ежеквартальные выплаты увеличились на 10 % до 1,06 доллара США на акцию.
Обладая достаточным свободным денежным потоком после выплат по обслуживанию долга, у Linde должно быть достаточно огневой мощи, чтобы сохранить свою полосу роста дивидендов.
А.О. Смит (AOS), производитель коммерческих и бытовых водонагревателей, является относительно недавним дополнением к Dividend Aristocrats, вступившим в клуб в 2018 году. В октябре 2021 года он объявил о повышении своих ежеквартальных выплат на 7,7% до 28 центов на акцию. Это ознаменовало собой 29-й год подряд повышения дивидендов для промышленной компании.
В результате пятилетний совокупный годовой темп роста дивидендов AOS теперь составляет более 17%. Между тем темпы роста дивидендов в годовом исчислении за пять лет превышают 158%.
Благодаря большому свободному денежному потоку и коэффициенту выплат ниже среднего, инвесторы могут рассчитывать на AOS, чтобы обеспечить рост дивидендов.
Эколаб (ECL) предоставляет услуги по очистке воды и другие услуги по техническому обслуживанию в промышленных масштабах для нескольких отраслей, включая пищевую промышленность, здравоохранение и нефтегазовую промышленность. С практической точки зрения, ее продукты помогают оптимизировать все, от добычи нефти на шельфе до полировки электроники и коммерческих прачечных.
Однако состояние Ecolab может пойти на убыль, поскольку производственные потребности колеблются; например, когда энергетические компании сокращают расходы, ECL почувствует на себе ожог.
Однако в долгосрочной перспективе акции этого дивидендного аристократа доказали свою эффективность. За последние пять, 10 и 15 лет акции принесли лучшую рыночную общую доходность. Это в немалой степени благодаря 30-летнему увеличению дивидендов подряд. Последнее повышение ECL произошло в декабре 2021 года, когда ежеквартальные платежи увеличились на 6 % до 51 цента на акцию.
Рупер Технологии (ROP) — промышленная компания, чья деятельность включает в себя медицинскую и научную визуализацию, радиочастотные технологии и программное обеспечение, а также энергетические системы и средства управления, — вот уже почти три десятилетия приносит прибыль.
Последнее повышение было объявлено в ноябре 2021 г., когда ежеквартальные выплаты были увеличены на 10,2 % до 62 центов на акцию.
Сочетание приобретений, органического роста и более высокой маржи помогло Roper увеличить свои дивиденды без увеличения прибыли. И хотя доход может показаться не таким уж большим, терпеливые инвесторы поняли, что стабильное увеличение дивидендов ROP повлияло на их доходность.
Defense contractor General Dynamics (GD) is one of the newer members of the Dividend Aristocrats, having been added to the elite list of best dividend stocks for growth in 2017.
Generous military spending has helped fuel this dividend stock's steady stream of cash returned to shareholders. In one of the most recent big deals, in December 2020 the company was awarded a $4.6 billion U.S. Army contract for latest configuration of the Abrams Main Battle Tank.
General Dynamics has upped its distribution for three decades now. The last increase was announced in March 2021, when GD lifted the quarterly payout by 8.2% to $1.19 a share. With its below-average payout ratio of 41%, General Dynamics should have sufficient room for more dividend growth.
Chevron (CVX) is an integrated oil giant that also has operations in natural gas and geothermal energy. It also happens to be the lone energy-sector name among the 30 stocks in the Dow Jones Industrial Average.
Analysts praise Chevron for having the strongest financial base in its peer group, a highly attractive portfolio of assets, and the "most straightforwardly positive risk/reward profile" of any stock in its sub-sector.
Perhaps most important for income investors, CVX has more than three decades of uninterrupted dividend growth under its belt, and management has said it will protect the payout at all costs. Chevron's last increase came in April 2021 with a 4% bump in the quarterly dividend to $1.34 per share.
Atmos Energy (ATO), which distributes and stores natural gas, was added to the Dividend Aristocrats in January 2020. The Dallas-headquartered firm serves more than 3 million distribution customers in more than 1,400 communities across eight states, with a large presence in Texas and Louisiana.
Analysts, who are mostly bullish on the name, point to ATO's strong fundamentals and increasing U.S. demand for natural gas. A robust balance sheet and potential for above-average earnings growth also recommend the stock.
Atmos clinched its 35th straight year of dividend growth in November 2021, when it announced an 8.8% increase to 68 cents a share per quarter.
A steady stream of acquisitions helped wholesale drug and medical device distributor Cardinal Health (CAH) become the giant that it is today. Its most recent acquisition – a $2.2 billion all-stock deal for Bindley Western Industries – closed in February 2021.
Like the rest of the medical device industry, CAH faced challenges during the pandemic as patients put off elective surgeries. But the company still managed to generate ample free cash flow and the dividend increases such cash flow supports.
Indeed, Cardinal Health has upped the ante on its annual payout for 35 years and counting. The Aristocrat last raised its disbursement in August 2021, declaring a 1% increase in the quarterly dividend to 49.08 cents per share.
Asset managers such as T. Rowe Price (TROW) have been losing market share to indexed funds of the type Vanguard offers, but the company still boasts a massive (and growing) $1.67 trillion in assets under management (AUM).
Strong performance from actively managed funds and the firm's focus on the growing retirement market are just two factors boosting AUM, analysts note.
T. Rowe Price has improved its dividend every year for 35 years, including an ample 20% increase to the payout announced in February 2021. Given its track record as one of the best dividend stocks, investors can expect a 36th consecutive dividend hike in 2022.
Telecommunications stocks are synonymous with dividends. Customers pay for service every month, which ensures a steady stream of cash for these dividend stocks.
AT&T (T) – the largest U.S. telecom company – is a perfect example.
AT&T has raised its dividend on an annual basis for 36 consecutive years, and typically boasts one of the highest yields in the S&P 500. That's in large part because of the cash flows generated by the telecom business, which enjoys what some call an effective duopoly with rival Verizon (VZ).
*AT&T didn't raise its dividend in 2020 and appears unlikely to raise it in 2021. Indeed, analysts expect AT&T to cut its dividend in 2022 because of the DirecTV and WarnerMedia spinoffs. Going two years without raising means AT&T will likely be bumped from the list in 2022.
McCormick (MKC) – the maker of herbs, spices and other flavorings – has been bulking up with acquisitions over the years to drive sales growth, and the deals have been paying off.
The strategy should to provide support for McCormick's dividend, which has been paid for 97 consecutive years and raised annually for 36. Most recently, in November 2021, the company hiked its quarterly dividend by 8.8% to 37 cents per share. McCormick's current annualized dividend of $1.36 per share represents an increase of 10% over the annual dividend of $1.24 per share paid in fiscal 2020.
With ample free cash flow and a reasonable payout ratio, MKC has been able to generate an annualized 10-year dividend growth rate of more than 107%. The company's 20-year annualized dividend growth rate tops 471%
Brown-Forman (BF.B) is one of the largest producers and distributors of alcohol in the world. Jack Daniel's Tennessee whiskey and Finlandia vodka are just two of its best-known brands, with the former helping drive long-term growth.
Unlike many of the best dividend stocks on this list, you won't have a say in corporate matters with the publicly traded BF.B shares. They hold no voting power. And most of the voting-class A shares are held by the Brown family.
Still, you can enjoy in the company's gains and dividends. That payout has been on the rise for 38 consecutive years and has been delivered without interruption for 76. Most recently, Brown-Forman last upped the quarterly ante in November 2021, by 5% to 18.85 cents per share.
Cintas (CTAS) is perhaps best-known for providing corporate uniforms, but the company also offers maintenance supplies, tile and carpet cleaning services and even compliance training.
As such, it's seen by some investors as a bet on jobs growth, and tends to move ahead of any pick-up in hiring during and economic recovery. Indeed, CTAS has worked pretty well as a proxy for employment in the past.
Regardless of how the labor market is doing, Cintas is a stalwart when it comes to being one of the best dividend stocks. The company has raised its payout every year since going public in 1983. However, those have been annual distributions up until this year, when the company switched to quarterly payouts.
Most recently, in July 2021, CTAS raised its quarterly dividend by 26.7% to 95 cents per share.
Amcor (AMCR) is a pretty boring company. It designs, manufactures and sells various packaging products for every industry you can think of, including food, beverage, pharmaceutical, medical, home and personal care.
But sometimes boring can be beautiful, and that's the case with Amcor when it comes to reliable income. It was named to the list of payout-hiking dividend stocks at the start of 2020 after its June acquisition of Bemis. Bemis, which fell out of the S&P 500 Index and thus the Aristocrats in 2014, rejoined by merit of its merger with Amcor.
The company last raised its dividend in November 2021, by 2.1% to 12 cents a share. The analyst community expects the company to deliver average annual earnings per share growth of 5.3% over the next three to five years.
Air Products &Chemicals (APD) has spent much of the past few years restructuring. Under pressure from investors, it started to shed some weight, including spinning off its Electronic Materials division and selling its Performance Materials business.
Air Products, which dates back to 1940, now is a slimmer company that has returned to focusing on its legacy industrial gases business. But it hasn't taken its eye off the dividend, which it has improved on an annual basis for 39 years in a row. That includes a 12% upgrade in January 2021 to $1.50 a share.
"In fiscal 2020, we were proud to return about $1.1 billion to our shareholders through our dividend while having significant distributable cash flow for high-return industrial gas investments," CEO Seifi Ghasemi said in a press release at the time.
Aflac (AFL) is a supplemental insurance company – popularized by the loud Aflac duck – with roots going back to 1955 that covers numerous workplace offerings, such as accident, short-term disability and life insurance.
Although the COVID-19 pandemic slammed the insurance industry, AFL stock returned to pre-crash levels by early 2021, helped by the market's confidence in its dividend. And with a conservative payout ratio and almost four straight decades of dividend growth, that confidence is indeed well placed.
Aflac last raised its payout in November 2021, upping the quarterly distribution by 21.2% to 40 cents per share.
Exxon Mobil (XOM) remains one of the world's largest energy companies and is the biggest oil company by market value in the U.S. It was removed from the blue-chip Dow Jones Industrial Average in August 2020, and will likely be dropped from the Dividend Aristocrats in January.
This dividend stalwart and its various predecessors have strung together uninterrupted payouts since 1882. To its credit, XOM was one of the few energy companies that didn't cut or suspend its payout amid the pandemic-caused crash in oil prices.
However, it did put a pause on its dividend growth.
The Dow component's quarterly distribution remained unchanged in 2020 amid the COVID-19 crisis. However, membership in the Dividend Aristocrats is based on consecutive increases to the annual payout; a 1.1% bump to the dividend in October 2021 ensured that XOM will have a slightly higher annual payout than in 2020, and thus remain in the club.
The name Franklin Resources (BEN) might not be well-known among investors; however, along with its subsidiaries, it's called the more familiar Franklin Templeton investments. The global investment firm is one of the world's largest with $1.53 trillion in assets under management, and is known for its bond funds, among other offerings.
Mutual fund providers have come under pressure because customers are eschewing traditional stock pickers in favor of indexed investments. However, Franklin has fought back in recent years by launching its first suite of passive exchange-traded funds.
Meanwhile, the asset manager remains attractive as an income provider for investors looking for the best dividend stocks. It has raised its dividend annually since 1981, including a 3.6% hike to 29 cents per share quarterly announced in December 2021.
Thanks to its 2017 acquisition of Valspar, Sherwin-Williams (SHW) is one of the largest paints, coatings and home-improvement companies in the world.
Income investors certainly don't need to worry about Sherwin-Williams' steady and rising dividend stream. SHW has hiked its distribution every year since 1979. The most recent hike came in February 2021 with a 23.1% raise to the quarterly payment to $1.65 per share. Additionally, the board added 15 million shares to the firm's stock repurchase authorization.
SHW's dividend now boasts a 10-year annualized growth rate of 272%.
Medtronic (MDT), one of the world's largest makers of medical devices, is an income machine. Most recently, in May 2021, MDT lifted its quarterly payout by 8.6% to 63 cents a share. Its dividend per share has grown by 47% over the past half-decade and has grown at a 16% compounded annual growth rate over the past 44 years, Medtronic says.
MDT is able to steer generous sums of cash back to shareholders thanks to the ubiquity of its products. It holds more than 47,000 patents on products ranging from insulin pumps for diabetics to stents used by cardiac surgeons.
Look around a hospital or doctor's office – in the U.S. or in more than 160 other countries – and there's a good chance you'll see its products.
Clorox (CLX), whose brands include its namesake bleaches, Glad trash bags and Hidden Valley salad dressing, was a big early beneficiary of the pandemic as demand surged for its ubiquitous cleaning materials.
That surge in demand has since passed, but the dependable and defensive nature of Clorox's business has allowed the company to increase its payout every year since 1977. The most recent raise came in June 2021 with a 5% bump to $1.16 per share per quarter.
CLX boasts a reasonale payout ratio and ample free cash flow, which should ensure a 45th consecutive increase to the dividend in 2022.
The world's largest hamburger chain also happens to be a dividend stalwart. Changing consumer tastes will always be a risk, but McDonald's (MCD) dividend dates back to 1976 and has gone up every year since. That's the power of being a consumer giant that has been able to adjust itself to changing consumer tastes without losing its core.
MCD last raised its dividend in September 2021, when it lifted the quarterly payout by 7% to $1.38 a share. That marked its 45h consecutive annual increase. The company's 10-year annualized dividend growth rate stands at 123%. And over the past 20 years? The annualized growth rate tops 2,244%.
U.K.-based water-treatment company Pentair (PNR) whose divisions include Flow Technologies, Filtration &Process and Aquatic &Environmental Systems, is always looking to expand its capabilities.
In early January 2021 it closed on its acquisition of Rocean, a maker of countertop filtration systems for the home. Terms were undisclosed. That followed its 2019 acquisition of Aquion for $160 million in cash.
Pentair has raised its dividend annually for 46 straight years, most recently in December 2021 by 5% to 21 cents a quarter. A modest payout ratio and consistently ample free cash flow helps ensure that Pentair will continue to be one of the best dividend stocks.
Tracing its roots back to a single drugstore founded in 1901, Walgreens Boots Alliance (WBA) has boosted its dividend every year for more than four decades. Mostly recently, in July 2021, it raised the quarterly dividend by 2.1% to 47.75 cents per share. WBA's five-year annualized dividend growth rate now stands at 32.6% as a result.
As for its origins, Walgreen Co. merged with Alliance Boots – a Switzerland-based health and beauty multinational – in 2014 to form the current company. Walgreens Boots Alliance and its predecessor company have paid a dividend in 355 straight quarters, or more than 88 years.
Automatic Data Processing (ADP) is the world's largest payroll processing firm, responsible for paying nearly 40 million employees and serving more than 920,000 clients across 140 countries.
Through good economic times and bad, one of ADP's great advantages is its "stickiness." After all, it's complicated and expensive for corporate customers to change payroll service providers. That competitive advantage helps throw off consistent income and cash flow. In turn, ADP has become a dependable dividend payer – one that has provided an annual raise for shareholders since 1975.
ADP's most recent dividend increase came in November 2021 when it lifted the quarterly payout 11.8% to $1.04 per share. The company's five-year annualized dividend growth rate stands at 83%.
The world's largest company by revenue might not pay the biggest dividend, but it sure is consistent. Walmart (WMT) has been delivering meager penny-per-share increases to its quarterly dividend since 2014, including February 2021's bump to 55 cents per share.
But that's been enough to maintain its 47-year streak of consecutive dividend increases. WMT's annualized payout now stands at $2.20 per share, up 1.8% from the $2.16 per share it returned the prior year.
And shareholders can count on the increases to keep coming. The discount retailer, which operates approximately 11,400 stores and e-commerce websites under 54 banners in 26 countries, is a cash machine. WMT has generated average annual free cash flow of more than $15 billion over the past seven years.
Archer Daniels Midland (ADM) processes ingredients for food and feed, including corn sweeteners, starches and emulsifiers such as lecithin. It also has a commodity trading business. It's a truly global agricultural powerhouse, too, boasting customers in 200 countries served by more than 800 facilities.
Archer Daniels Midland has paid out dividends on an uninterrupted basis for 89 years. The most recent hike came in January 2021, when ADM increased the quarterly payout by 2.8% to 37 cents a share. The move extended the dividend stock's streak of annual raises to 47 years.
Consolidated Edison (ED) is the largest utility company in New York State by number of customers. Founded in 1823, it provides electric, gas or steam services to roughly 3.5 million customers in New York City and Westchester County. ConEd also happens to be North America's second-largest solar power provider, and is investing in electric vehicle charging programs and other green energy endeavors.
Like most utilities, Consolidated Edison is highly regulated but enjoys a fairly stable stream of revenues thanks to limited direct competition – but not a lot of growth. The longtime Dividend Aristocrat has hiked its annual distribution without interruption for close to five decades. In January 2021, the utility raised its quarterly payout 1.3% to 77.5 cents per share from 76.5 cents per share.
Formerly known as McGraw Hill Financial, S&P Global (SPGI) is the company behind S&P Global Ratings, S&P Global Market Intelligence and S&P Global Platts. Although most investors probably know it for its majority stake in S&P Dow Jones Indices – which maintains the benchmark S&P 500 index and the blue-chip Dow Jones Industrial Average – it's also a central player in corporate and financial analytics, information and research.
S&P Global has paid a dividend each year since 1937 and is one of fewer than 25 companies in the S&P 500 that has increased its dividend annually for at least 48 years, the company notes. Most recently, in January 2021, SPGI raised its quarterly payout by a healthy 15% to 77 cents a share.
Leggett &Platt (LEG) has its hands in several pies, including producing steel wire; designing and manufacturing seating support systems for automobiles; and making components for manufacturers of upholstered furniture, beds and other home furnishings.
Although it's not a particularly famous company, it has been a dividend champion for long-term investors. Or had been, anyway. After 48 straight years of annual dividend increases, LEG did not lift the payout in 2020.
However, Leggett &Platt will maintain its membership in the Aristocrats thanks to a 5% upgrade to its dividend, to 42 cents per share, in May 2021, continuing its streak of increased payouts on an annual basis.
Nucor (NUE) is the largest U.S. steelmaker, but it's perhaps even more well known for its almost unrivaled commitment to dividend growth. As one of the best dividend stocks, Nucor has increased its dividend for 49 straight years, or every year since it began paying dividends in 1973.
The most recent increase came in December 2021 when NUE lifted the quarterly disbursement more than 23% to 50 cents per share. Nucor returned nearly $3.53 billion to shareholders in the form of share repurchases and dividend payments during the first 11 months of 2021.
Kimberly-Clark's (KMB) well-known brands include Huggies diapers, Scott paper towels and Kleenex tissues. Like other makers of consumer staples, Kimberly-Clark holds out the promise of delivering slow but steady growth along with a healthy dividend to drive total returns.
Kimberly-Clark has paid out a dividend for 84 consecutive years and has raised the annual payout for 49 consecutive years. In January 2021, the board of directors approved a 6.5% increase in the quarterly dividend to $1.14 a share. KMB also authorized a new $5 billion share repurchase program that supplements the current $5 billion authorization, which is expected to be completed later this year.
VF Corp. (VFC) is an apparel company with a large number of brands under its umbrella, including The North Face outdoor products, Timberland boots and Eastpak backpacks.
Importantly, as acquisitive as VFC has traditionally been, it's never been shy about tailoring its portfolio to maintain maximum profitability. In 2019, the company spun off its jeans business to shareholders via the publicly traded Kontoor Brands (KTB). The following year VFC acquired streetwear brand Supreme, but also divested its occupational workwear brands and business.
That sort of flexibility helps the company maintain the free cash flow required to keep the dividend increases coming. And, indeed, they do keep coming.
VFC in October 2021 raised its dividend for a 49th consecutive year – a 2% increase to 49 cents per share per quarter. The company also reinstated its share repurchase program, with an authorization to buy back up to $2.8 billion of its common stock. VFC suspended share repurchases in April 2020 due to the COVID-19 pandemic.
Not too long ago, investors fretted over a long-term slide in sales of carbonated beverages, but that turned out not to be a secular trend after all. Indeed, Grand View Research forecasts the global market for fizzy drinks to produce a compound annual growth rate of 4.7% through 2028.
Besides, PepsiCo (PEP) has an ace up its sleeve with its snacks business. The company's Frito-Lay division is known for Doritos, Tostitos, Rold Gold pretzels, and numerous other brands. Meanwhile, demand for salty snacks remains solid.
The bottom line? PEP's business remains fundamentally strong, and that should keep its dividend-growth streak intact. PepsiCo declared its 49th straight annual increase in May 2021 with a 5% bump in the quarterly dividend to $1.075 per share.
Abbott Laboratories (ABT) manufactures a wide variety of healthcare goods. Its portfolio includes branded generic drugs, medical devices, nutrition and diagnostic products. Some of its best-known products include Similac infant formulas, Glucerna diabetes management products and i-Stat diagnostics devices.
Abbott Labs dates all the way back to 1888. It first paid a dividend in 1924 and its dividend growth streak is long-lived too, at 50 years and counting. The last payout hike came in December 2021 — a 4.4% increase to 47 cents per share quarterly.
Medical devices maker Becton Dickinson (BDX) has bulked up quite a bit over the past few years. In 2015, it acquired CareFusion, a complementary player in the same industry. Then in 2017, it struck a $24 billion deal for fellow Dividend Aristocrat C.R. Bard, another medical products company with a strong position in treatments for infectious diseases.
As a result of all that M&A, BDX boasts a highly diversified portfolio of products – and the ample free cash flow needed to support continued dividend growth. BDX last raised its payout in November 2021 with a 4.8% raise to the quarterly dividend to 87 cents a share.
PPG Industries (PPG) makes coatings and paints for numerous industries, including aerospace, architecture, automotive and packaging. Its sprawling operations employ roughly 47,000 people in more than 50 countries.
PPG has paid a dividend since 1899 and has raised it annually for 50 years. A below-average payout ratio and solid outlook for long-term earnings growth should keep the dividend increases coming. PPG's last raise came in July 2021 with a 9.3% bump in the quarterly distribution to 59 cents per share.
Target (TGT) might be the No. 2 discount retail chain after Walmart in terms of revenue, but it doesn't take a back seat to the behemoth from Bentonville when it comes to dividends.
Target paid its first dividend in 1967, seven years ahead of Walmart, and has raised its payout annually since 1972. The last hike came in June 2021, when the retailer raised its quarterly disbursement by a whopping 32.4% to 90 cents a share.
With its well-below-average payout ratio, income investors can count on Target to keep hitting the mark for dividend growth. Indeed, over the past 10 years, its annualized dividend growth rate comes to more than 138%.
W.W. Grainger (GWW) – which not only sells industrial equipment and tools, but provides other services such as helping companies manage inventory – is expected to generate steady if not spectacular sales growth for the next few years. EPS growth, however, is forecast to increase at a double-digit percent rate.
Happily for the income-minded, Grainger has achieved annual dividend growth for a half century and maintains a below-average payout ratio. It renewed its Dividend Aristocrats membership card in April 2021 when it announced a 5.9% increase in the quarterly payout to $1.62 per share.
AbbVie (ABBV) is one of the highest yielders on this list of the best payout-improving dividend stocks. The pharmaceutical company was spun off from fellow Dividend Aristocrat Abbott Laboratories in 2013.
Including its time as part of Abbott, AbbVie has upped its annual distribution for 50 consecutive years. The most recent hike – an 8.5% increase to the quarterly payment to $1.41 per share – was declared in October 2021.
The company's best-selling treatments include Humira:a rheumatoid arthritis drug that has been approved for numerous other ailments, and that appears is on pace to surpass Lipitor as the best-selling drug of all time. AbbVie also makes cancer drug Imbruvica, as well as testosterone replacement therapy AndroGel.
Founded in 1912, Illinois Tool Works (ITW) makes construction products, car parts, restaurant equipment and more. While ITW sells many products under its namesake brand, it also operates businesses including Foster Refrigerators, ACME Packaging Systems and the Wolf Range Company.
In August 2021, Illinois Tool Works raised its quarterly dividend by 7% to $1.22 cents a share, bringing its streak of annual increases to 50 years. However, the company notes that excluding a period of government controls in 1971, that streak would stretch to 58 years. Either way, ITW's dividend sports a 10-year annualized growth rate of 240%.
Years of acquisitions have made Sysco (SYY) the food services and supply giant it is today. And the company's scale really came in handy during the pandemic, when it had to weather the closure of restaurants, bars and other food-service venues.
Happily for shareholders, the sudden and sharp downturn couldn't stop SYY from hiking its dividend for a 52nd consecutive year. The company last raised its payout in May 2021 with a 4.4% bump to 47 cents per share per quarter.
Power- and hand-toolmaker Stanley Black &Decker (SWK) has improved its cash distribution annually for more than half a century, including a 13% increase to 79 cents per share quarterly in July 2021.
SWK has bulked up through a series of deals over the past five years or so, including the acquisitions of Newell Tools, the Craftsman tool brand, IES Attachments, Nelson Fastener Systems and Consolidated Aerospace Manufacturing.
A low payout ratio and ample free cash flow should keep it SWK's dividend growth streak going.
Real estate investment trusts such as Federal Realty Investment Trust (FRT) are required to pay out at least 90% of their taxable earnings as dividends in exchange for certain tax benefits. Thus, REITs are well known as some of the best dividend stocks you can buy.
And few have been steadier than FRT, which owns retail and mixed-use real estate in several major metropolitan areas. Federal Realty Investment Trust has now hiked its payout every year for 54 years – the longest consecutive record in the REIT industry. It's latest increase – upping the quarterly dividend by a penny to $1.07 per share – was announced in August 2021.
Hormel Foods (HRL) is best known for Spam, but it's also responsible for its namesake meats and chili, Skippy peanut butter, Dinty Moore stews and House of Tsang sauces, among other brands.
But it shouldn't go unnoticed that the packaged food company is about as reliable as they come when it comes to income investing, having raised its payout every year for more than five decades.
Indeed, in November 2021, Hormel announced its 56th consecutive dividend increase – a 6% raise to 26 cents per share quarterly. The packaged foods company is rightly proud to note that it has paid a regular dividend without interruption since becoming a public company in 1928.
When it comes to home improvement chains, Home Depot (HD), a member of the Dow Jones Industrial Average, gets all the glory. But rival Lowe's (LOW) is the superior dividend grower.
Lowe's has paid a cash distribution every quarter since going public in 1961, and that dividend has increased annually for more than half a century. Most recently, in May 2021, Lowe's lifted its quarterly payout by 33% to 80 cents per share. Home Depot is a longtime dividend payer, too, but its string of annual dividend increases dates back only to 2010.
Lowe's 10-year annualized dividend growth rate now stands at 463%.
Colgate-Palmolive (CL) sells a wide range of consumer staples brands including its namesake toothpaste and dish soap, as well as Speed Stick deodorant, Murphy cleaning products and Tom's of Maine personal-care products.
Demand for Colagte's products tends to remain stable in both good economic times and bad, and that drives the free cash flow need to maintain its dividend growth streak.
And what a streak it is. Colgate's dividend dates back more than a century, to 1895, and the company has increased it annually for 59 years. CL last raised its payment in March 2021, upping the quartley distribution by a penny to 45 cents per share.
Johnson &Johnson (JNJ), founded in 1886 and public since 1944, operates in several different segments of the healthcare industry. In addition to pharmaceuticals, it makes over-the-counter consumer products such as Band-Aids, Neosporin and Listerine. It also manufactures medical devices used in surgery.
JNJ's diversification across three major business segments adds fortitude to this defensive dividend stock, and that helps income investors sleep better at night. The healthcare giant has increased its payout for nearly three decades and counting. The most recent hike came in April 2021 when JNJ increased the quarterly dividend by 5% to $1.06 per share.
Coca-Cola (KO) has long been known for quenching consumers' thirst, but it's equally effective at quenching investors' thirst for income. The company's dividend history stretches back to 1920, and the payout has swelled for 59 consecutive years. The last hike, announced in February 2021, was admittedly modest, though, at 2.4% to 42 cents per share per quarter.
Coca-Cola has worked hard to expand its offerings beyond traditional carbonated beverages, adding bottled water, fruit juices, sports drinks and teas to its product lineup. In addition to the namesake Coca-Cola brand, KO also sports names such as Minute Maid, Powerade, Simply Orange and Vitaminwater.
Property and casualty insurer Cincinnati Financial's (CINF) offerings include life insurance, annuities, umbrella insurance and a wide range of business insurance products.
Shares took a beating during the worst of the pandemic – and have since come bounding back – but even when CINF was bottoming out investors knew they could count on their dividends. Indeed, at 61 consecutive years and counting, Cincinnati Financial boasts one of the longest dividend growth streaks of any Dividend Aristocrat.
The P&C insurer most recently lifted its quarterly payout in January 2021, by 5% to 63 cents per share.
Shares in 3M (MMM), which makes everything from adhesives to electric circuits to N95 respirators, have been a long-time market laggard. But as much as this Dow stock has been a disappointment in terms of price appreciation, there's no questioning its value as a compounding source of income.
Indeed, the conglomerate's dividend dates back more than a century. Even better, 3M has been delivering annual dividend increases to investors for 63 years. The most recent hike came in early February 2021 with a 1% bump in the quarterly payout to $1.48 per share.
With major brands such as Tide detergent, Pampers diapers and Gillette razors, Procter &Gamble (PG) is among the world's largest consumer products companies.
Although the economy ebbs and flows, demand for products such as toilet paper, toothpaste and soap tends to remain stable. That hardly makes P&G completely recession-proof, but it does make the grade as one of the best dividend stocks because it's an equity income machine.
The Dow Jones Industrial Average component has paid shareholders a dividend since 1890, and has raised its payout annually for 65 years in a row. P&G's most recent raise came in April 2021 with a 10% bump to 86.98 cents per share quarterly.
Automotive and industrial replacement parts maker Genuine Parts (GPC) is best-known for the Napa brand. However, it also has deep roots in Mexico, where it operates under the AutoTodo brand, as well as Canada, where it operates as UAP.
Founded in 1928, Genuine Parts has long made returning cash to shareholders a priority.
The company has paid a cash dividend every year since going public in 1948 – or 65 consecutive years. The last hike – a 3% improvement to 81.5 cents per share quarterly – came in February 2021.
Emerson Electric (EMR) makes a wide variety of industrial products, ranging from control valves to electrical fittings.
The company has paid dividends since 1956 and has boosted its annual payout for 66 consecutive years, including its last increase – 2% to 51.5 cents per share quarterly – declared in November 2021. As a result, EMR's three-year annualized dividend growth rate stands at 4.2%.
With a reasonable payout ratio and plenty of free cash flow, investors can count on Emerson Electric to keep the dividend hikes coming.
Dividend growth has been a priority for Dover (DOV), which at 66 consecutive years of annual distribution hikes underscores its commitment to returning cash to shareholders.
The industrial conglomerate has its hands in all sorts of businesses, from Dover-branded pumps, lifts and even productivity tools for the energy business, to Anthony-branded commercial refrigerator and freezer doors. It's not an exciting business, but it can be a remunerative one.
Dover last raised its payout in August 2021, when it upped the quarterly outlay by 1% to 50 cents per share.
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