In this article, we discuss 16 best consistent dividend stocks to invest in. You can skip our detailed analysis of dividend stocks and their previous performance, and go directly to read 5 Best Consistent Dividend Stocks to Invest In.
According to a recent report by S&P Dow Jones Indices, in the third quarter of 2023, a total of 448 dividend increases were announced by US companies, amounting to a substantial $18.0 billion in increased dividend payments. This data underscores a positive trend in the financial landscape, as a significant number of companies chose to boost their dividend payouts during this period, which can be seen as a promising indicator for investors and shareholders alike.
That said, when it comes to dividend investing, many investors tend to be overly attracted to high yields, a behavior that financial experts discourage. Although high yields can provide short-term satisfaction, the key to reaping lasting advantages from dividends is to prioritize the stability and long-term reliability of those dividend payments. Dan Lefkovitz, a strategist for Morningstar Indexes, spoke about durable dividend stocks. Here are some comments from the analyst:
“It’s really critical to be selective when it comes to buying dividend-paying stocks and chasing yield. Looking for the most yield-rich areas of the market can often lead you into troubled areas and dividend traps—companies that have a nice-looking yield that is ultimately unsustainable. You have to screen for dividend durability and reliability going forward.”
Dividends can serve as a powerful indicator of a company's potential to boost its profits and cash flow in the future. The S&P 500 Dividend Aristocrats, a select group of large-cap companies, have consistently increased their dividends for at least 25 years, with many surpassing 40 years. Over time, these companies have demonstrated higher return on equity and more robust earnings growth when compared to the broader S&P 500. According to a report by ProShares, ever since its introduction, the S&P 500 Dividend Aristocrats Index has consistently outperformed the broader S&P 500 index while maintaining lower levels of market volatility. This means that an initial investment of $10,000 made in May 2005 could have potentially grown to over $61,000 by March 2023. What's particularly noteworthy is that the S&P 500 Dividend Aristocrats Index has managed to capture 91% of the market's upswings and 80% of its downturns, demonstrating robust performance in both bullish and bearish market conditions. To learn more about dividend stocks, readers can have a look at Dividend Aristocrats Ranked By Yield: Top 25.
Expanding on the points covered earlier, we will discuss some of the best dividend stocks with consistent payouts in this article.
Our Methodology:
We compiled this list by examining Insider Monkey's Q2 2023 database and identifying companies that have consistently increased their dividends for a minimum of 20 consecutive years. From this pool, we specifically chose stocks with dividend yields of at least 1% as of November 6. The stocks are ranked in ascending order of the number of hedge funds having stakes in them as of Q2 2023.
16. United Parcel Service, Inc. (NYSE:UPS)
Number of Hedge Fund Holders: 47
United Parcel Service, Inc. (NYSE:UPS) is a Georgia-based package delivery and supply chain management company. On November 1, the company declared a quarterly dividend of $1.62 per share, which was in line with its previous dividend. The company has been raising its dividends for 21 consecutive years, which makes it one of the best dividend stocks on our list. The stock's dividend yield on November 6 came in at 4.54%.
The number of hedge funds tracked by Insider Monkey owning stakes in United Parcel Service, Inc. (NYSE:UPS) jumped to 47 in Q2 2023, from 39 in the previous quarter. The consolidated value of these stakes is more than $945.5 million.
15. 3M Company (NYSE:MMM)
Number of Hedge Fund Holders: 49
3M Company (NYSE:MMM) is an American diversified conglomerate that operates in various industries, including industrial, healthcare, consumer, and safety and graphics. In October, Citigroup raised its price target on the stock to $97, appreciating the company's recent quarterly earnings and its improving supply chain dynamics.
3M Company (NYSE:MMM), one of the best dividend stocks, has been growing its dividends consistently for 65 years. The company offers a quarterly dividend of $1.50 per share and has a dividend yield of 6.39%, as of November 6.
As of the end of Q2 2023, 49 hedge funds in Insider Monkey's database reported having stakes in 3M Company (NYSE:MMM), compared with 51 in the previous quarter. The consolidated value of these stakes is over $726.7 million.
14. Chubb Limited (NYSE:CB)
Number of Hedge Fund Holders: 50
Chubb Limited (NYSE:CB) is a multinational insurance company that provides a wide range of insurance products and services to individuals and businesses. The company currently pays a quarterly dividend of $0.86 per share and has a dividend yield of 1.57%, as of November 6. It is one of the best dividend stocks on our list as the company has been rewarding shareholders with growing dividends for the past 30 years.
Barclays raised its price target on Chubb Limited (NYSE:CB) to $277 and maintained an Overweight rating on the shares, following the company's recent Q3 earnings.
At the end of Q2 2023, 50 hedge funds tracked by Insider Monkey owned investments in Chubb Limited (NYSE:CB), growing from 45 in the previous quarter. The overall value of these stakes is over $1.7 billion. With over 1.5 million shares, Millennium Management was the company's leading stakeholder in Q2.
13. Caterpillar Inc. (NYSE:CAT)
Number of Hedge Fund Holders: 50
Caterpillar Inc. (NYSE:CAT) is a Texas-based manufacturer of construction and mining equipment, diesel and natural gas engines, industrial gas turbines, and other industrial machinery. On October 19, the company declared a quarterly dividend of $1.30 per share, which was in line with its previous dividend. The company's dividend growth streak currently stands at 29 years, which makes CAT one of the best dividend stocks on our list. As of November 6, the stock has a dividend yield of 2.16%.
Insider Monkey's database of Q2 2023 indicated that 50 hedge funds owned stakes in Caterpillar Inc. (NYSE:CAT), compared with 52 in the previous quarter. The total value of these stakes is over $2.55 billion.
12. International Business Machines Corporation (NYSE:IBM)
Number of Hedge Fund Holders: 51
International Business Machines Corporation (NYSE:IBM) is next on our list of the best dividend stocks to invest in. The American multinational tech company offers a quarterly dividend of $1.66 per share and has a dividend yield of 4.49%, as recorded on November 6. The company has raised its dividends every year for the past 28 years.
At the end of June 2023, 51 hedge funds in Insider Monkey's database owned investments in International Business Machines Corporation (NYSE:IBM), up from 49 in the preceding quarter. Their collective stake value is roughly $814 million.
11. Lockheed Martin Corporation (NYSE:LMT)
Number of Hedge Fund Holders: 52
Lockheed Martin Corporation (NYSE:LMT) is a global aerospace and defense company that is one of the largest and most prominent defense contractors in the world. The company offers a quarterly dividend of $3.15 per share, growing it by 5% in October this year. Through this increase, the company took its dividend growth streak to 21 years, which makes LMT one of the best dividend stocks on our list. As of November 6, the stock has a dividend yield of 2.78%.
In October, Argus raised its price target on Lockheed Martin Corporation (NYSE:LMT) to $510 and maintained a Buy rating on the shares, highlighting the company's growing revenue and strong balance sheet.
Lockheed Martin Corporation (NYSE:LMT) was a part of 52 hedge fund portfolios at the end of Q2 2023, as per Insider Monkey's database. The stakes owned by these hedge funds have a collective value of roughly $2 billion. Among these hedge funds, Two Sigma Advisors was the company's leading stakeholder in Q2.
10. Colgate-Palmolive Company (NYSE:CL)
Number of Hedge Fund Holders: 58
Colgate-Palmolive Company (NYSE:CL) is a multinational consumer goods company that specializes in the production and distribution of a wide range of personal care and household products. The company has been raising its dividends consistently for the past 61 years and it currently pays a quarterly dividend of $0.48 per share. The stock's dividend yield on November 6 came in at 2.57%.
The number of hedge funds in Insider Monkey's database owning stakes in Colgate-Palmolive Company (NYSE:CL) grew to 58 in Q2 2023, from 55 in the previous quarter. The total value of these stakes is over $2.66 billion.
9. NextEra Energy, Inc. (NYSE:NEE)
Number of Hedge Fund Holders: 59
NextEra Energy, Inc. (NYSE:NEE) is a leading American electric power company primarily focused on the generation, transmission, distribution, and sale of electricity. The company offers a quarterly dividend of $0.4675 per share and has a dividend yield of 3.13%, as of November 6. It is one of the best dividend stocks on our list as the company has been growing its dividends consistently for the past 27 years.
NextEra Energy, Inc. (NYSE:NEE) was included in 59 hedge fund portfolios at the end of Q2 2023, according to Insider Monkey's database. The consolidated value of stakes owned by these hedge funds is more than $918.3 million. With over 2.5 million shares, Two Sigma Advisors was the company's largest stakeholder in Q2.
8. The Coca-Cola Company (NYSE:KO)
Number of Hedge Fund Holders: 61
The Coca-Cola Company (NYSE:KO) is next on our list of the best dividend stocks to invest in. The American multinational company has raised its dividend payouts for 61 consecutive years, holding one of the longest dividend growth track records in the market. The company pays a quarterly dividend of $0.46 per share and has a dividend yield of 3.23%, as of November 6.
As of the end of the June quarter of 2023, 61 hedge funds in Insider Monkey’s database reported having stakes in The Coca-Cola Company (NYSE:KO), which remained unchanged from its previous quarter. The collective value of these stakes is over $27.2 billion.
7. Lowe's Companies, Inc. (NYSE:LOW)
Number of Hedge Fund Holders: 64
Lowe's Companies, Inc. (NYSE:LOW) is a North Carolina-based retail chain that specializes in home improvement and home appliance products. The company holds a 59-year track record of dividend growth and its quarterly payout currently stands at $1.10 per share. With a dividend yield of 2.27% as of November 6, LOW is one of the best dividend stocks on our list.
As per Insider Monkey's database of Q2 2023, 64 hedge funds owned investments in Lowe's Companies, Inc. (NYSE:LOW), worth over $3.7 billion in total.
6. Analog Devices, Inc. (NASDAQ:ADI)
Number of Hedge Fund Holders: 65
Analog Devices, Inc. (NASDAQ:ADI) is a multinational semiconductor company that is well-known for its analog and mixed-signal integrated circuits. The company pays a quarterly dividend of $0.86 per share, growing it by 13% in February this year. This was the company's 20th consecutive year of dividend growth, which makes ADI one of the best dividend stocks on our list. As of November 6, the stock has a dividend yield of 2.07%.
At the end of Q2 2023, 65 hedge funds in Insider Monkey’s database reported having stakes in Analog Devices, Inc. (NASDAQ:ADI), compared with 73 in the preceding quarter. The collective value of these stakes is over $5.1 billion.
Ensemble Capital Management mentioned Analog Devices, Inc. (NASDAQ:ADI) in its Q3 2023 investor letter. Here is what the firm has to say:
Analog Devices, Inc. (NASDAQ:ADI): Analog Devices, known in the industry as ADI, makes semiconductor chips that predominantly operate at the boundary of the physical world and the digital world, more commonly referred to as analog and mixed signal chips. These chips usually play a supporting role to the sexier “digital brain” that is the latest and greatest processor from Nvidia, Intel, AMD, Apple, or Qualcomm. While the digital brains get a lot more media attention, the supporting analog chips are as vital as those big expensive digital processors in driving value in electronic devices, which are becoming ubiquitous and intelligent throughout our lives.
Anything with an on-off switch requires lots of these analog chips if it is going to relay input and output information with the physical world as well as manage the electrical power supply feeding the device. While these analog chips are relatively inexpensive to manufacture and distribute, it takes a long time to design and build a catalog of literally thousands of specific products to create the scale that makes them economically attractive businesses with a reputation of dependability and quality…” (Click here to read the full text)
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Disclosure. None. 16 Best Consistent Dividend Stocks to Invest In is originally published on Insider Monkey.
