The Dividend Aristocrats List Features 65 Stocks With 25-Plus Years of Consecutive Payout Increases

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Dividend Aristocrats is a group of few dozen S&P 500 companies that have a record of boosting their annual dividend distribution amount for at least the last 25 consecutive years.

Published in 1989, the first list of Dividend Aristocrats contained 26 companies. Rebalancing of the Dividend Aristocrats’ list to add and drop companies based on their eligibility occurs quarterly in January, April, July and October. After the initial Dividend Aristocrats list in 1989, some companies dropped off the list for failing to meet the eligibility requirements and other companies extended their consecutive annual dividend hikes streaks to reach the 25-year eligibility milestone. More companies joined the list then dropped off, and the list expanded to 64 companies in 2001.

 

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By the financial crisis in 2008, the number of Dividend Aristocrats declined to 52. Many of the Dividend Aristocrats succumbed to the negative effects in the aftermath of the crisis and nine dropped off the list – eight for failing to meet eligibility requirements and Mars, Incorporated acquired the Wrigley Company. As the markets and the overall economy recovered from the recession the Dividend aristocrats list began expanding again and currently includes 65 companies.

Update: as of December 8, 2022, AT&T (T) and People’s United Financial (PBCT) have been removed. Simultaneously, Brown & Brown (BRO) and Church & Dwight Co (CHD) have been added to the Dividend Aristocrats list, keeping the total count the same.

The Dividend Aristocrats Title is More than a Status Symbol — It Has Profound Implications

Some experts claim that dividends are irrelevant to the overall performance of a stock. However, back-tested history indicates that public companies with rising dividends produce higher overall returns for their shareholders and experience lower volatility over a long-term investment horizon.

While long-term rising dividends might not be the only reason for a company’s lasting performance, rising dividends over an extended period indicate efficient capital management, as well as sufficiently strong cash flow and profit to support the growing dividend payouts.

Some companies in the Dividend Aristocrats category have specific policies for raising dividends year after year. The companies with these rising-dividend policies in place are usually the best picks for reliable and growing dividend income and long-term asset appreciation.

 

There are Several Advantages to Investing in the Dividend Aristocrats

In addition to the aforementioned efficient capital management and sufficient cash flow, long-term rising dividends also indicate that a company is able to withstand changing market conditions. During a 25-year period, a company will go through several boom-bust cycles. A company worthy of the dividend aristocrats title can effectively get through the up-and-down cycles of the market and maintain its rising dividends clearly — these companies are well-managed and will provide dividend income, dividend growth and asset appreciation.

 

25 Years Is the Minimum Streak Required for the Dividend Aristocrats

The dividend aristocrats’ minimum 25 year streak for achieving consecutive payments is somewhat arbitrary and there are other lists that group long-term dividend-paying companies into distinct groups depending on the length of their rising dividends record. Dividend Kings are companies with 50 or more years of consecutive dividend hikes and considerably fewer companies currently meet that standard.

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Besides the two widely accept classifications above, investment analysts and investors created additional categories with slightly different requirements. Companies that have boosted their dividends for 10 or more years are sometimes called Dividend Contenders or Dividend Achievers. Some investment analysts designated companies with five or more consecutive dividend boosts as Dividend Challengers.

While the Achievers, Challengers and Contenders number in the hundreds, the list of about 65 Dividend Aristocrats is a relatively focused one of dividend-paying companies. Just lowering the cutoff by five years to 20 would triple the number of companies on the list to more than 150.

Therefore, 25 years might be a little arbitrary, but it also keeps the list of companies to a manageable size.

 

You Can Take Advantage of the Dividend Aristocrats Without Buying Individual Stocks

Exchange-traded funds (ETFs) that invest in stocks of these Dividend Aristocrat companies include the SPDR S&P Dividend (NYSE:SDY), which tracks the S&P High Yield Dividend Aristocrats Index, and ProShares S&P 500 Dividend Aristocrats (BATS:NOBL). Both are examples of index funds that track stocks with long-term rising dividends.

 

The Dividend Aristocrats List Provides a Straightforward Way to Identify Companies that have Proven Their Ability to Sustain Rising Dividend Payments at Least 25 Straight Years

However, investors should consider a few additional indicators, such as share-price trends, price-to-earnings (P/E) ratios, moving averages, etc.

Professional investors and active traders might be able to achieve higher total returns by trading other equities with higher yields over shorter periods. Nevertheless, frequent trading can incur additional fees, which will reduce total returns. Some of the equities with high yields can be very volatile and expose investors to considerable loss risk.

For investors who have a diversified portfolio of growth equities and are looking for a steady and secure income, Dividend Aristocrats might be the answer. While there are ways to potentially increase total returns on investment by trading more risky equities frequently, the small additional return might not be worth the additional risk exposure.

In that case, taking long positions in a few of the Dividend Aristocrats – or a fund that tracks such stocks – could be the right move for investors who are willing to forego potentially higher, but risky returns in favor of long-term, low-volatility and steady income stream produced by the Dividend Aristocrats.

 

Company Ticker Sector Market Cap Latest Close Price Projected 12 Month Dividend Yield Trailing 12 Month Dividend Yield
A.O. Smith ADM Consumer Products $10.45B $86.15 1.49% 1.44%
AbbVie ABBV Health Care $295.76B $167.52 3.70% 3.58%
Abbott Laboratories ABT Health Care $193.48B $111.45 1.97% 1.87%
Air Products & Chemicals APD Materials $52.50B $236.25 3.00% 2.97%
Albemarle Corp. ALB Materials $15.30B $130.31 1.23% 1.23%
Amcor PLC KO Consumer Products $255.30B $59.05 3.12% 3.16%
Archer-Daniels-Midland ADM Consumer Products $31.90B $62.57 3.20% 2.96%
Atmos Energy Corporation ATO Utilities $17.25B $114.38 2.82% 2.70%
Becton, Dickinson & Co. MKC Consumer Products $18.48B $73.42 2.29% 2.21%
Brown & Brown BRO Financials $23.62B $82.65 0.63% 0.59%
Brown-Forman BF___B Consumer Products $15.45B $50.41 1.73% 1.68%
Cardinal Health CAH Health Care $25.88B $106.42 1.88% 1.88%
Caterpillar CAT Industrials $185.76B $371.98 1.40% 1.37%
Chevron CVX Energy $302.29B $161.89 4.03% 3.81%
Cincinnati Financial CINF Financials $18.70B $119.17 2.72% 2.57%
Cintas CTAS Industrials $68.09B $671.13 0.80% 0.77%
Clorox CLX Consumer Products $17.97B $144.80 3.31% 3.30%
Coca-Cola KO Consumer Products $255.30B $59.05 3.12% 3.16%
Consolidated Edison ED Utilities $30.59B $88.55 3.75% 3.68%
Dover DOV Industrials $24.24B $173.28 1.18% 1.17%
Ecolab ECL Materials $63.03B $220.75 1.03% 1.00%
Emerson Electric EMR Industrials $64.90B $113.52 1.85% 1.84%
Essex Property Trust ESS Financials $15.68B $244.25 4.01% 3.84%
Expeditors International of Washington EXPD Industrials $17.09B $118.76 1.16% 1.16%
Federal Realty Investment Trust FNMA Financials $1.84B $1.59 0.00% N/A
Franklin Resources BEN Financials $13.84B $26.28 4.72% 4.64%
General Dynamics GD Industrials $78.77B $287.50 1.98% 1.87%
Genuine Parts GPC Consumer Products $20.37B $146.11 2.74% 2.63%
Hormel Foods HRL Consumer Products $19.14B $34.95 3.23% 3.17%
Illinois Tool Works ITW Industrials $76.99B $257.68 2.17% 2.14%
International Business Machines IBM IT & Communications $170.42B $185.90 3.57% 3.57%
Johnson & Johnson JNJ Health Care $358.18B $148.79 3.20% 3.20%
Kimberly-Clark KMB Consumer Products $42.47B $126.08 3.87% 3.78%
Linde LIN Materials $218.15B $453.00 1.23% 1.43%
Lowe’s LOW Services $134.72B $235.44 1.87% 1.85%
McDonald’s MCD Services $193.96B $268.62 2.49% 2.38%
McCormick & Co. MKC Consumer Products $18.48B $73.42 2.29% 2.21%
Medtronic MDT Health Care $109.11B $82.17 3.36% 3.36%
NextEra Energy Inc. NEE Utilities $125.18B $63.94 3.22% 3.00%
Nucor NUE Materials $47.51B $197.34 1.09% 1.06%
PPG Industries PPG Materials $32.37B $137.60 1.89% 1.87%
Pentair PNR Industrials $13.52B $81.78 1.12% 1.09%
PepsiCo PEP Consumer Products $231.40B $168.36 3.01% 3.01%
Procter & Gamble PG Consumer Products $366.69B $155.84 2.59% 2.41%
Realty Income Corporation O Financials $44.99B $52.24 5.90% 5.88%
Roper Technologies ROP IT & Communications $57.75B $539.64 0.56% 0.53%
Sherwin-Williams SHW Materials $81.89B $319.92 0.89% 0.79%
S&P Global SPGI Financials $132.84B $422.92 0.86% 0.85%
Stanley Black & Decker SWK Industrials $14.35B $93.32 3.47% 3.46%
Sysco SYY Services $38.12B $76.57 2.61% 2.61%
T. Rowe Price Group TROW Financials $26.31B $117.72 4.21% 4.16%
Target TGT Services $79.10B $171.33 2.57% 2.56%
VF Corp. VFC Consumer Products $5.11B $13.13 2.74% 5.94%
Walgreens Boots Alliance WBA Services $15.59B $18.08 5.53% 9.35%
Walmart WMT Services $484.21B $60.09 1.38% 1.29%
W.W. Grainger GWW Industrials $47.51B $966.27 0.77% 0.77%
West Pharmaceutical Services, Inc. WST Health Care $28.68B $387.58 0.21% 0.20%
ExxonMobil XOM Energy $482.64B $121.79 3.12% 3.05%

 

Related articles:

3 Best Dividend Aristocrats to Buy Now

The Dividend Aristocrats Investing Strategy and Stocks List

The Best Dividend Aristocrats ETFs

Why Invest in the Dividend Aristocrats?

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The S&P 500 Dividend Aristocrats — Everything You Need to Know

What are the Dividend Aristocrats?

 


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Jonathan Wolfgram

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Jonathan Wolfgram
Jonathan Wolfgram is an investment analyst who writes website content at Eagle Financial Publications. He graduated from the University of Minnesota with Bachelor’s degrees in Finance and Philosophy. Jonathan writes for www.DividendInvestor.com and www.StockInvestor.com.
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