Long-time s&p 500 dividend aristocrats, dividend growth investors know the power of patience. The best dividend stocks – companies that raise their payouts like clockwork decade after decade – can produce superior total returns, even if they sport apparently ho-hum yields.

Regular dividend increases also lift the yield on an investor’s original cost basis. Stick around long enough, and the unimpressive 1% yield you received on your initial investment can grow by leaps and bounds. And, as always, let’s not forget the magic of compounding.

As Ben Franklin famously said, “Money makes money. And the money that money makes, makes money.” The Dividend Aristocrats and the index of dividend aristocrats are firms in the S& P 500 Index that has increased their yearly dividend distributions for at least 25 straight years and have increased their payouts every year during that time.

This list of the S&P 500’s finest dividend stocks includes both well-known companies and smaller, less well-known companies, all of which play important roles in the American economy.

And although they are dispersed over almost every area of the market, they all have one thing in common: a commitment to consistent and long-term dividend growth. Pay attention to the following names, as they have proven financial resilience and are on the radar of investors for much stock.

NextEra Energy

NextEra Energy (NEE), clearway energy is one of the new names to the Aristocrats, having joined in 2015. In January 2021, the utility firm was elevated to the top echelon of dividend-growth companies.

The corporation is divided into two primary businesses: Florida Power & Light (FPL) is the state’s biggest electric utility, and NextEra Energy Resources is a prominent participant in renewable energy sources such as wind and solar. Having a successful regulated utility in the same industry as a rapidly developing renewables firm is appealing to analysts.

The growing population and the Biden administration’s emphasis on renewable energy production should be beneficial to the company’s operations in some main ways. The firm last increased its dividend in February 2021, increasing the quarterly payout by 10% to 38.5 cents per share, which was the first time the company has done so.

The US investment market and hedge fund holders pay much attention and invest much money on the NYSE in renewable energy companies. When more stable times come, this company will perform even better than the current base dividend.

Consecutive annual dividend increases: 26

International Business Machines

Global business giant International Business Machines (IBM), a component of the Dow Jones Industrial Average, isn’t nearly as prominent as it was in the past.

In recent years, the company’s revenue has been steadily declining over the greater part of two decades, hampered by its second-tier position in crucial growth areas such as social and mobile technologies, analytics, and cloud infrastructure.

Despite this, Big Blue has remained a dividend stalwart, earning membership in the Dividend Aristocrats in January 2021 after a series of slips and falls. IBM increased its quarterly dividend by a cent to $1.64 per share in April 2021, marking the company’s 26th consecutive year of dividend increases. Since 1916, IBM has paid quarterly dividends on a consistent basis.

Importantly, the firm has the financial resources to maintain its growth streak, which is a feature you like.

Consecutive annual dividend increases: 26

Albemarle

ALB, which produces specialty chemicals such as lithium, recently increased its dividend by 1.3 percent to 39 cents per share quarterly, the company’s most recent dividend increases.

Despite the fact that Albemarle’s products operate fully in the background, its compounds are used in a variety of sectors, ranging from clean-fuel technologies to medicines to fire safety.

Lithium, on the other hand, is at the center of the bull case. In the words of CFRA Research, “The favorable view on electric vehicle adoption is ALB’s major driver, and we think there is additional upside risk for this trend to accelerate under a Blue Wave in the United States.”

Consecutive annual dividend increases: 27

Caterpillar

Caterpillar (CAT), the world’s biggest manufacturer of heavy construction and mining equipment, joined the ranks of the Dividend Aristocrats in January of this year. Since 1933, CAT has paid a consistent dividend without fail, and it has increased its distribution every year for the last 27 years.

Most recently, in June 2021, the firm increased the dividend by 8 percent, bringing it to $1.11 each quarter. In the past year, this company showed solid growth potential.

The finest dividend stocks generate enough free cash flow to support their dividend payments, and CAT easily meets that requirement. CAT generated $1.97 billion in free cash flow after debt payments for the fiscal year that ended on December 31, 2020, after paying out $2.2 billion in dividends.

Consecutive annual dividend increases: 27

Essex Property Trust

Expeditors International of Washington (EXPD) was admitted to the Aristocrats in January 2020, bringing the total number of consecutive annual dividend increases to 27.

The logistics firm recently increased its semiannual dividend in May 2021, increasing it to 58 cents a share from 52 cents a share, which was the previous increase. In recent years, the transportation firm has experienced a period of hardship.

During the last presidential administration, trade disputes between the United States and China had a significant negative impact on EXPD. COVID-19, on the other hand, has caused significant disruptions in airfreight tonnage quantities as well as ocean container shipments.

Throughout it all, though, EXPD has stayed devoted to its semiannual dividend, which it has increased year after year for more than a quarter-century and continues to do so now. A continually low payout ratio should assist to guarantee that Expeditors has the resources to keep the streak alive and preserve its position on a list of the best freight forwarders.

Consecutive annual dividend increases: 27

Chubb

Chubb (CB) was just admitted to the ranks of the Dividend Aristocrats (DA). The insurance company’s dividend was last increased in May 2021, when it increased from 78 cents a share to 80 cents a share. Chubb achieved its 28th straight year of dividend increase as a result of this decision.

Chubb, the world’s biggest publicly listed property and casualty insurance firm, has operations in 54 countries and territories, making it the largest in the world.

Despite the fact that it is not the most interesting subject for dinner conversation, it is a thriving company that has paid a dividend for decades. In addition, Chubb’s consistent dividend increases build up over time in a significant way. Indeed, the insurer has achieved an annualized dividend growth rate of more than 134 percent over the last 20 years.

Consecutive annual dividend increases: 28

West Pharmaceutical Services

As a result of its almost three-decade history of yearly dividend increases, West Pharmaceutical Services (WST) was inducted into the ranks of the Dividend Aristocrats in January 2021. When it comes to injectable pharmaceuticals and other medical items, WST is a vital component of the healthcare supply chain, producing packaging components and delivery systems.

In addition, bulls point out that demand for COVID-19 vaccinations is increasing demand for the company’s goods. Meanwhile, the biopharmaceutical industry’s substantial pipeline should be able to sustain longer-term expansion.

The company last increased its dividend in October 2021, resulting in a 5.9 percent rise in the quarterly distribution, which brought it to 18 cents a share. The presence of significant free cash flow and a low payout ratio should provide comfort to shareholders that yearly dividend hikes will continue.

Consecutive annual dividend increases: 29

Ecolab

Water treatment and other industrial-scale maintenance services are provided by Ecolab (ECL) to a variety of sectors, including food and beverage processing, healthcare, and oil and gas extraction. In the real world, its products aid in the optimization of anything from offshore oil production to electronics polishing to commercial laundries, among other things.

Ecolab’s fortunes, on the other hand, might fade when industrial demands shift; for example, when energy businesses cut expenditure, ECL will suffer the consequences. Over the long term, however, the shares of this Dividend Aristocrat have shown to be a profitable investment.

For the last five, ten, and fifteen years, the stock has provided total returns that have outperformed the market. This is due in large part to the fact that the company has increased dividends for 30 straight years. ECL’s most recent rise occurred in December 2021, when the quarterly dividend was increased by 6 percent, bringing it to 51 cents per share.

Consecutive annual dividend increases: 30

Roper Technologies

One of the more attractive dividends paying companies for investors today as it produces much earnings. It has been over three decades since Roper Technologies (ROP), an industrial corporation whose operations include medical imaging, RF technology, software development for wireless communications systems, and power management systems, among other things, has been generating profits.

The most recent increase was announced in November 2021, when the quarterly dividend was increased by 10.2 percent, to 62 cents per share, marking the company’s third consecutive increase. A mix of acquisitions, organic growth, and higher margins has enabled Roper to increase its dividend without diluting its earnings over the long term. In addition, although the yield may not seem to be significant, patient investors have learned to realize the positive impact that ROP’s consistent dividend hikes have had on their gains.

Consecutive annual dividend increases: 30

Emerson Electric

A vast range of industrial items is manufactured by Emerson Electric (EMR), ranging from control valves to electrical fittings and everything in between. As of the current year, the firm had paid dividends since 1956 and had increased its yearly payment for 66 consecutive years, including its most recent rise – a 2 percent increase to 51.5 cents per share quarterly – that was announced in November of the previous year.

As a consequence, EMR’s annualized dividend growth rate over the last three years has increased to 4.2 percent. Emerson Electric has an acceptable payout ratio and generates a significant amount of free cash flow, so investors should expect the company to continue increasing its dividend. This is certainly not a gambling company as it is trustworthy and safe, which can be seen in the annual payouts it makes to its shareholders for a consecutive number of years.

Consecutive annual dividend increases: 66

Dover

Dover (DOV) has made increasing dividends a priority, as seen by the company’s 66 consecutive years of annual dividend increases, which demonstrates its dedication to repaying income to shareholders. From Dover-branded pumps, elevators, and even productivity tools for the energy industry to Anthony commercial refrigerators and freezer doors, the industrial giant is involved in a wide range of enterprises.

It’s not a very fascinating business, but it may be financially a great place for a rewarding one. It was in August 2021 that Dover last increased its dividend, increasing it by 1 percent to 50 cents per share, marking the company’s most recent increase.

Consecutive annual dividend increases: 66

Dividends

Our list:

It is important to make a good choice which is dependent on the company information. If the company has reliable income streams and history of raises, pay attention. As investors struggled to locate solid income sources and share prices in the middle of the epidemic, dividend investing remained a top priority.

According to a Fidelity article, dividend years have accounted for almost 40% of total stock market gains since 1930, for example, and continue with high yields. Additionally, Fidelity’s analysis points out that dividends are critical to returns, particularly when equities are falling in value, as was the situation with S&P 500 companies in the 1930s and 2000s, according to the firm.

Dividends helped to cushion the effect of dropping stock prices in the 1940s and 1970s, when they accounted for 65 percent and 71 percent, respectively, of the S& P 500’s return. Worthy mention on the list of stocks is Johnson & Johnson, Crown Castle, Sprague resources lp, s&p dow jones indices.

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