However, it’s only outperformed the S&P 500 by 1.5% per year over the last 10 years. 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. Power- and hand-toolmaker Stanley Black & Decker (SWK) has improved its cash distribution annually for more than half a century, including a 1.3% increase to 80 cents per share quarterly in July 2022. 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. The discount retailer, which operates approximately 11,400 stores and e-commerce websites under 54 banners in 26 countries, is a cash machine.
Additionally, DLR is a REIT, which means it has to pay the majority of its profits to shareholders in the form of dividends. As a result, Digital Realty looks like a strong candidate to grow its current dividend yield in the wake of a strong secular tailwind. If everything goes according to plan, DLR won’t only be one of the best dividend stocks in 2022; it may even be one of the highest paying dividend stocks to own over the next decade.
The last hike – a 6.1% improvement to 95 cents per share quarterly – came in February 2023. The Dow Jones Industrial Average component has paid shareholders a dividend since 1890, and has raised its payout for 66 years in a row. P&G's most recent raise came in April 2022 with a 5% bump to 91.33 cents per share quarterly. 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.
It renewed its Dividend Aristocrats membership card in April 2022 when it announced a 6.2% increase in the quarterly payout to $1.72 per share. MCD last raised its dividend in October 2022, when it lifted the quarterly payout by 10% to $1.52 a share. The company's 10-year compound annual dividend growth rate stands at 7%. In April 2023, IBM raised the quarterly dividend by a penny to $1.66 per share, marking its 28th consecutive year of increases.
Below is a broad screen of REITs that have high dividend yields and are also expected to generate enough excess cash in 2023 to enable increases in dividend payouts. To find the best dividend stocks we polled experienced fund managers at major mutual fund companies. We asked representatives of each portfolio to recommend one stock they felt had a solid dividend yield, an attractive valuation, and potential for growth. Blackstone stock trades 21% below our fair value estimate of $105 and lands on Morningstar’s list of the top 33 undervalued stocks for the second quarter of 2023.
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.
In January 2023, the utility raised its quarterly payout 2.5% to 81 cents per share. 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 four straight decades of dividend growth, that confidence is indeed well placed.
Essex Property Trust (ESS), which was added to the Dividend Aristocrats in 2020, is a real estate investment trust (REIT) that invests in apartments primarily on the West Coast. Brown & Brown (BRO), which offers insurance brokerage services to both businesses and consumers, has been in operation since 1939, but its stock wasn't added to the S&P 500 until 2021. International Business Machines (IBM), a component of the Dow Jones Industrial Average, isn't quite as illustrious as it once was.
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Many of these companies, which are in poor financial health, end up cutting their dividends, leaving buyers high and dry. Given ongoing economic uncertainty and stock market volatility, investors looking for the best dividend stocks today might consider adding undervalued, quality dividend stocks to their portfolios. Finding high-yield dividend stocks is as simple as searching brokerages for companies currently offering the highest yield. The information is displayed front and center, along with the stock price and everything else investors need to know. That said, there’s a huge difference between stocks that offer a large dividend and quality dividend stocks.
Long Track Record of a Reliable Dividend with No Cuts
The other thing I look for that’s really important is a company that has a long track record of a reliable dividend, that hasn’t cut the dividend. And preferably a stock that has raised the dividend every single year. For 2022 through Nov. 28, the S&P 500 has declined 17%, while the real estate sector has fallen 27%, excluding dividends. JSI and Jiko Bank are not affiliated with Public Holdings, Inc. (“Public”) or any of its subsidiaries. You should consult your legal, tax, or financial advisors before making any financial decisions. This material is not intended as a recommendation, offer, or solicitation to purchase or sell securities, open a brokerage account, or engage in any investment strategy.
Dividend investing is a tried-and-true strategy that millions of investors have used to profit off long-established companies with excellent track records. This performance might surprise some investors, when considering the REITs’ income focus and the S&P 500’s heavy weighting for rapidly growing technology companies. Please see Open to the Public Investing’s Fee Schedule to learn more.
The company’s core markets offer slow and steady growth while its newer software and cloud-focused businesses offer upside growth potential. Kerwin calls Cisco’s shareholder return policies “superb,” as the company dedicates more than half of its sizable https://forexarticles.net/xtreamforex-analysis/ cash flow to its dividend and share repurchases. The big oil giant's top financial priority is to sustain and grow its dividend. The company delivered its 36th consecutive annual dividend increase in 2023, one of the longest streaks among oil stocks.
The buy-and-hold portfolios are a more useful measure of how a long term investing approach utilizing this watchlist could perform. Both buy-and-hold portfolios invest an equal amount each month into all 10 chosen high yield stocks, the positions are never sold and all dividends are reinvested back into the issuing stock. We favored companies with strong brands and economic moats, and the size to weather coming storms, all with market caps in the billions of dollars.
Canadian oil pipeline giant Enbridge has been an outstanding dividend stock over the years. It has paid dividends for more than 68 years, including expanding its payout in each of the past 28 years. Drugmaker AbbVie has had an excellent dividend track record since its spinoff from Abbott Labs (ABT -0.28%) in 2013. From its inception through early 2023, AbbVie has increased its payout by a whopping 270%.
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. Nordson's (NDSN) addition to the Dividend Aristocrats on Feb. 1, 2023, boosted the industrial sector's representation in the equity income benchmark. 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 nine states, with a large presence in Texas and Louisiana.
Investors need to understand their risk tolerance before investing in high dividend stocks. Share price fluctuations means that your investment can (and almost certainly will) decline in value, at least temporarily (and possibly permanently) do to market volatility. Dividends are nice, but they aren’t the only factor to consider when buying a stock. Ideally, a dividend stock is financially strong and growing—continued stability and growth signals that the company’s dividend is sustainable over the long term and likely to be increased regularly.
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