The Dividend Aristocrats List – The 65 Stocks with 25-Plus Years of Consecutive Dividend Increases
By: Jonathan Wolfgram,
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: on January 22nd, 2021, Carrier Global (NYSE:CARR), Otis Worldwide (NYSE:OTIS) and Raytheon Technologies (NYSE:RTX) were all removed from the dividend aristocrats. Simultaneously, International Business Machines (NYSE:IBM), NextEra Energy (NYSE:NEE) and West Pharmaceutical Services (NYSE:WST) were added. As a result, the total count stayed at 65 and is still there as of September 13, 2021.
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 that can effectively get through the up-and-down cycles of the market and maintain its rising dividends clearly is well-managed and will provide dividend income, dividend growth and asset appreciation.
25 Years Is the Minimum Streak Required for the Dividend Aristocrats
The minimum 25 years 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.
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 |
|---|---|---|---|---|---|---|
| Archer-Daniels Midland | ADM | Consumer Products | $34.58B | $61.82 | 2.39% | 2.39% |
| Amcor | AMCR | Materials | $17.26B | $11.26 | 4.17% | 4.20% |
| Brown-Forman | BF___B | Consumer Products | $21.88B | $70.64 | 1.06% | 1.02% |
| Colgate-Palmolive | CL | Consumer Products | $63.54B | $75.39 | 2.39% | 2.37% |
| Clorox | CLX | Consumer Products | $20.37B | $165.76 | 2.80% | 2.74% |
| Coca-Cola | KO | Consumer Products | $225.91B | $52.30 | 3.21% | 3.21% |
| Hormel Foods | HRL | Consumer Products | $22.82B | $42.06 | 2.47% | 2.33% |
| Kimberly-Clark | KMB | Consumer Products | $44.37B | $131.76 | 3.46% | 3.41% |
| McCormick | MKC | Consumer Products | $21.58B | $86.55 | 1.71% | 1.57% |
| PepsiCo | PEP | Consumer Products | $221.45B | $160.16 | 2.68% | 2.62% |
| Procter & Gamble | PG | Consumer Products | $354.28B | $146.40 | 2.38% | 2.32% |
| Sysco | SYY | Services | $34.90B | $68.07 | 2.76% | 2.70% |
| Walmart | WMT | Services | $382.41B | $137.14 | 1.60% | 1.60% |
| Walgreens Boots Alliance | WBA | Services | $37.84B | $43.72 | 4.37% | 4.32% |
| A.O. Smith | AOS | Consumer Products | $10.58B | $79.46 | 1.41% | 1.33% |
| Cintas | CTAS | Industrials | $43.19B | $417.62 | 0.91% | 0.81% |
| Dover | DOV | Industrials | $23.45B | $162.83 | 1.23% | 1.22% |
| Emerson Electric | EMR | Industrials | $51.63B | $86.79 | 2.37% | 2.34% |
| Expeditors International | EXPD | Industrials | $20.84B | $123.01 | 0.94% | 0.94% |
| Illinois Tool Works | ITW | Industrials | $72.45B | $230.81 | 2.11% | 2.01% |
| 3M | MMM | Health Care | $98.38B | $170.73 | 3.47% | 3.47% |
| Pentair | PNR | Industrials | $11.95B | $72.24 | 1.11% | 1.11% |
| Roper Technologies | ROP | IT & Communications | $48.48B | $459.58 | 0.54% | 0.49% |
| Stanley Black & Decker | SWK | Industrials | $27.89B | $171.07 | 1.85% | 1.74% |
| W.W. Grainger | GWW | Industrials | $24.59B | $477.26 | 1.36% | 1.34% |
| Caterpillar | CAT | Industrials | $103.57B | $191.47 | 2.32% | 2.24% |
| Abbott Laboratories | ABT | Health Care | $224.11B | $126.74 | 1.42% | 1.42% |
| AbbVie | ABBV | Health Care | $204.91B | $115.91 | 4.87% | 4.49% |
| Becton, Dickinson | BDX | Health Care | $68.64B | $241.67 | 1.44% | 1.37% |
| Cardinal Health | CAH | Health Care | $12.93B | $45.87 | 4.27% | 4.26% |
| Johnson & Johnson | JNJ | Health Care | $416.16B | $158.08 | 2.68% | 2.65% |
| West Pharmaceutical Services | WST | Materials | $32.26B | $435.41 | 0.17% | 0.16% |
| Medtronic | MDT | Health Care | $141.94B | $105.47 | 2.29% | 2.29% |
| Genuine Parts | GPC | Consumer Products | $18.00B | $126.38 | 2.58% | 2.56% |
| Leggett & Platt | LEG | Consumer Products | $5.41B | $40.53 | 4.15% | 4.05% |
| Lowe’s | LOW | Services | $165.30B | $245.34 | 1.30% | 1.14% |
| McDonald’s | MCD | Services | $182.46B | $244.18 | 2.26% | 2.15% |
| Target | MDT | Health Care | $115.18B | $240.39 | 1.50% | 1.31% |
| VF | VFC | Consumer Products | $27.82B | $70.83 | 2.82% | 2.77% |
| Aflac | AFL | Financials | $35.50B | $53.67 | 2.98% | 2.46% |
| Cincinnati Financial Corp | CINF | Financials | $18.18B | $112.85 | 2.23% | 2.21% |
| Franklin Resources | BEN | Financials | $16.00B | $31.82 | 3.52% | 3.52% |
| S&P Global | SPGI | Financials | $108.22B | $449.06 | 0.69% | 0.69% |
| T. Rowe Price | TROW | Financials | $44.06B | $196.03 | 2.20% | 3.64% |
| Chubb | CB | Financials | $75.44B | $175.14 | 1.83% | 1.80% |
| People’s United Financial | PBCT | Financials | $7.12B | $16.64 | 4.39% | 4.37% |
| Air Products & Chemicals | APD | Materials | $63.10B | $284.94 | 2.11% | 2.05% |
| Albemarle | ALB | Materials | $30.40B | $259.85 | 0.60% | 0.60% |
| Ecolab | ECL | Materials | $63.13B | $220.30 | 0.93% | 0.87% |
| PPG Industries | PPG | Materials | $36.44B | $153.48 | 1.54% | 1.47% |
| Sherwin-Williams | SHW | Materials | $86.77B | $330.95 | 0.66% | 0.66% |
| Nucor | NUE | Materials | $29.92B | $104.69 | 1.91% | 1.55% |
| Linde | LIN | Materials | $163.14B | $318.29 | 1.33% | 1.30% |
| Chevron | CVX | Energy | $216.09B | $112.10 | 4.78% | 4.74% |
| ExxonMobil | XOM | Energy | $253.12B | $59.79 | 5.89% | 5.84% |
| Automatic Data Procssing | ADP | IT & Communications | $95.60B | $226.87 | 1.83% | 1.64% |
| IBM | IBM | IT & Communications | $104.85B | $116.92 | 5.61% | 5.60% |
| Essex Property Trust | ESS | Financials | $21.36B | $328.16 | 2.55% | 2.54% |
| Federal Realty Investment Trust | FRT | Financials | $9.42B | $121.14 | 3.53% | 3.51% |
| Realty Income | O | Financials | $27.52B | $65.92 | 4.48% | 4.30% |
| AT&T | T | IT & Communications | $158.74B | $22.23 | 9.36% | 9.36% |
| Atmos Energy | ATO | Utilities | $11.84B | $89.43 | 3.04% | 2.86% |
| Consolidated Edison | ED | Utilities | $27.57B | $77.94 | 3.98% | 3.98% |
| NextEra Energy | NEE | Utilities | $171.97B | $87.84 | 1.75% | 1.75% |
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Jonathan Wolfgram is an editorial staffer 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.
