Dividend Aristocrats
Dividend Aristocrats are companies that are part of the S&P 500 and have increased their dividends in each of the past 25 years. Dividend Aristocrats are some of the most stable dividend payers in the stock market. These are a special category of dividend-paying stocks with a long track record of making – and increasing – their payouts. They are appealing to investors who are seeking companies that pay dividends and have shown the ability to grow them over time. Companies in this list have been able to grow their dividends through many different economic environments and through significant periods of recession. As of July 2024, there are over 60 dividend aristocrats across many different parts of the economy, including healthcare, consumer staples, financial and industrial sectors.
ABOUT DIVIDEND ARISTOCRATS
Dividend Aristocrats tend to be large, more mature companies that consider paying dividends to shareholders as a top priority.
According to S&P Global, the Dividend Aristocrats have produced a better long-term return than the S&P 500 and done so with less risk.
These companies have remained relevant for decades while continuing to generate reliable cash flow and maintain solid financial health.
Dividend aristocrats are concentrated in more stable sectors, with industrials, consumer staples, healthcare, and utilities.
The Dividend Aristocrat list is refreshed each year, with new companies meeting the criteria being added while those failing it being removed.
DIVIDEND ARISTOCRATS CRITERIA
Be part of the Standard & Poor’s 500 Index
Pay and raise its dividend for at least 25 straight years
Have a market capitalization of at least $3 billion
Have an average daily trading volume of at least $5 million
DIVIDEND ARISTOCRATS VS. DIVIDEND KINGS
Dividend Kings and Dividend Aristocrats are both coveted groups of companies known for their long history of consistently increasing dividends.
Dividend Aristocrats must have increased their dividends for at least 25 years and be a member of the S&P 500 index. Dividend Kings have a requirement of 50 years of uninterrupted dividend increases, with no stipulations regarding S&P 500 membership or market capitalization.
Not all Dividend Kings are Dividend Aristocrats. This unexpected result is because the "only" requirement to be a Dividend King is 50+ years of rising dividends.
Both categories offer investors a level of reliability and potential for steady income, though Dividend Kings, due to their longer track record, may offer an even greater perception of stability to investors.