Dividend Aristocrats

  • by
dividend aristocrats

What does Dividend Aristocrat mean?

A stock that pays dividends, has increased dividends consistently for the last 25 years is called a dividend aristocrat stock. The dividend aristocrats are well established companies and have been paying out dividends for a long time already. This signals to investors that these companies are reliable for long term investment. Dividend Aristocrats are also suitable for the investors seeking a reliable source of income (through dividend payouts).

What is the Criteria to be a Dividend Aristocrat Stock?

Here’s the criteria for being a dividend aristocrat:

ad

  • The stock must be in the S&P 500 Index
  • The stock must pay dividends
  • Must have increased dividends every year for the last 25 years
  • Should have a market cap of $3 Billion or more
  • Must have an average daily trading value of at least $5 million

Is the List of Dividend Aristocrats Updated?

The stocks are evaluated regularly, and some stocks may lose their status while new ones might get added to the list based on fulfilling the criteria mentioned above.

If a stock misses out on increasing the dividend one year, it gets dropped from the list of Dividend Aristocrats, and isn’t included again until it completes another 25 years of annual increase in dividend payouts.

As part of the list updating process, in early 2021, three new stocks were added to the list – International Business Machines (IBM), NextEra Energy (NEE), and West Pharmaceutical Services (WST). Simultaneously, three stocks were removed the list as well – Carrier Global (CARR), Otis Worldwide (OTIS), and Raytheon Technologies (RTX) leaving the total count unaltered.

dividend aristocrats

How many Dividend Aristocrat stocks are there?

There are 65 Dividend Aristocrat stocks as of October 2021. The stocks are from various industries such as industrials, consumer staples, healthcare, financials, and information technology. Few of the highest dividend yield aristocrats are AT&T (T), Exxon Mobil (XOM), Chevron (CVX), IBM (IBM), and AbbVie (ABBV).

ad

Are all Dividend Aristocrats part of the S&P 500 Index?

Yes, by definition, all Dividend Aristocrats must be part of the S&P 500 Index.

Are FAANG Stocks or Other Tech Stocks Dividend Aristocrats?

No, currently none of the FAANG stocks are dividend aristocrats. In fact only one of the FAANG stocks (Apple – AAPL) pays dividends at all. Among the MFAANG, Microsoft also pays dividends but it is also not a dividend aristocrat.

ad

In the list, there are only two stocks from the Information Technology sector that are dividend aristocrats. Those two stocks are International Business Machine (IBM) and Automatic Data Processing (ADP).

Which Stocks or Companies are Dividend Aristocrats?

Here’s the List of All Dividend Aristocrats with their Dividend Yields

It is important to note that to predict the sustainability of the dividend payouts in the future, consider taking a look at the stocks’ Dividend Payout Ratios. Generally, lower dividend payout ratios mean the company is stable and still has room to grow the dividends in the future.

StockTicker SymbolDividend YieldYears of Dividend Growth
DoverDOV1.21%65
Genuine PartsGPC2.56%65
Emerson ElectricEMR2.11%64
3MMMM3.25%63
Coca-ColaKO3.08%59
Colgate-PalmoliveCL2.36%57
Johnson & JohnsonJNJ2.63%59
Procter & GamblePG2.41%64
Stanley Black & DeckerSWK1.74%53
Hormel FoodsHRL2.30%55
Becton, Dickinson & Co.BDX1.38%49
Illinois Tool WorksITW2.18%50
Leggett & PlattLEG3.67%50
PPG IndustriesPPG1.47%49
TargetTGT1.47%50
W.W. GraingerGWW1.51%50
AbbVieABBV4.76%49
Abbott LaboratoriesABT1.53%49
Federal Realty Investment TrustFRT3.45%53
Kimberly ClarkKMB3.42%49
PepsiCoPEP2.71%49
VF Corp.VFC2.66%47
NucorNUE1.59%48
S&P GlobalSPGI0.69%48
Archer Daniels MidlandADM2.31%47
Automatic Data ProcessingADP1.75%46
Consolidated EdisonED4.16%46
Lowe’sLOW1.46%46
Walgreens Boots AllianceWBA3.90%45
CloroxCLX2.84%52
McDonald’sMCD2.28%45
PentairPNR1.11%45
WalmartWMT1.57%47
MedtronicMDT1.97%44
Sherwin-WilliamsSHW0.74%42
SyscoSYY2.29%52
Franklin ResourcesBEN3.73%40
Cincinnati FinancialCINF2.12%60
AflacAFL2.38%38
Air Products & ChemicalsAPD2.05%39
ExxonMobilXOM5.56%37
Amcor PLCAMCR3.95%38
AT&TT8.12%35
Brown-FormanBF-B1.04%37
CintasCTAS0.91%38
EcolabECL0.87%29
McCormick & Co.MKC1.71%35
T. Rowe Price GroupTROW2.16%34
Cardinal HealthCAH4.04%34
ChevronCVX4.89%33
Atmos Energy CorporationATO2.69%37
General DynamicsGD2.29%30
West Pharmaceutical Services, Inc.WST0.17%28
A.O. SmithAOS1.70%29
LindeLIN1.38%29
Roper TechnologiesROP0.48%28
CaterpillarCAT2.23%27
ChubbCB1.76%28
People’s United FinancialPBCT4.12%27
Albemarle Corp.ALB0.68%27
Essex Property Trust, Inc.ESS2.51%27
Expeditors International of Washington, Inc.EXPD1.00%27
Realty Income CorporationO4.07%26
International Business MachinesIBM4.54%26
NextEra Energy IncNEE1.89%26
Source: Yahoo Finance

Dividend Aristocrat Stocks Interactive Table

StockTicker SymbolExchangeDividend YieldSectorYears of Dividend Growth
DoverDOVNYSE1.21%Industrials65
Genuine PartsGPCNYSE2.56%Consumer discretionary65
Emerson ElectricEMRNYSE2.11%Industrials64
3MMMMNYSE3.25%Industrials63
Coca-ColaKONYSE3.08%Consumer staples59
Colgate-PalmoliveCLNYSE2.36%Consumer staples57
Johnson & JohnsonJNJNYSE2.63%Healthcare59
Procter & GamblePGNYSE2.41%Consumer staples64
Stanley Black & DeckerSWKNYSE1.74%Industrials53
Hormel FoodsHRLNYSE2.30%Consumer staples55
Becton, Dickinson & Co.BDXNYSE1.38%Healthcare49
Illinois Tool WorksITWNYSE2.18%Industrials50
Leggett & PlattLEGNYSE3.67%Consumer discretionary50
PPG IndustriesPPGNYSE1.47%Materials49
TargetTGTNYSE1.47%Consumer discretionary50
W.W. GraingerGWWNYSE1.51%Industrials50
AbbVieABBVNYSE4.76%Healthcare49
Abbott LaboratoriesABTNYSE1.53%Healthcare49
Federal Realty Investment TrustFRTNYSE3.45%Real estate53
Kimberly ClarkKMBNYSE3.42%Consumer staples49
PepsiCoPEPNASDAQ2.71%Consumer staples49
VF Corp.VFCNYSE2.66%Consumer discretionary47
NucorNUENYSE1.59%Materials48
S&P GlobalSPGINYSE0.69%Financials48
Archer Daniels MidlandADMNYSE2.31%Consumer staples47
Automatic Data ProcessingADPNASDAQ1.75%Information technology46
Consolidated EdisonEDNYSE4.16%Utilities46
Lowe'sLOWNYSE1.46%Consumer discretionary46
Walgreens Boots AllianceWBANASDAQ3.90%Consumer staples45
CloroxCLXNYSE2.84%Consumer staples52
McDonald'sMCDNYSE2.28%Consumer discretionary45
PentairPNRNYSE1.11%Industrials45
WalmartWMTNYSE1.57%Consumer staples47
MedtronicMDTNYSE1.97%Healthcare44
Sherwin-WilliamsSHWNYSE0.74%Materials42
SyscoSYYNYSE2.29%Consumer staples52
Franklin ResourcesBENNYSE3.73%Financials40
Cincinnati FinancialCINFNASDAQ2.12%Financials60
AflacAFLNYSE2.38%Financials38
Air Products & ChemicalsAPDNYSE2.05%Materials39
ExxonMobilXOMNYSE5.56%Energy37
Amcor PLCAMCRNYSE3.95%Materials38
AT&TTNYSE8.12%Communications services35
Brown-FormanBF-BNYSE1.04%Consumer staples37
CintasCTASNASDAQ0.91%Industrials38
EcolabECLNYSE0.87%Materials29
McCormick & Co.MKCNYSE1.71%Consumer staples35
T. Rowe Price GroupTROWNASDAQ2.16%Financials34
Cardinal HealthCAHNYSE4.04%Healthcare34
ChevronCVXNYSE4.89%Energy33
Atmos Energy CorporationATONYSE2.69%Utilities37
General DynamicsGDNYSE2.29%Industrials30
West Pharmaceutical Services, Inc.WSTNYSE0.17%Healthcare28
A.O. SmithAOSNYSE1.70%Industrials29
LindeLINNYSE1.38%Materials29
Roper TechnologiesROPNYSE0.48%Industrials28
CaterpillarCATNYSE2.23%Industrials27
ChubbCBNYSE1.76%Financials28
People's United FinancialPBCTNASDAQ4.12%Financials27
Albemarle Corp.ALBNYSE0.68%Materials27
Essex Property Trust, Inc.ESSNYSE2.51%Real estate27
Expeditors International of Washington, Inc.EXPDNASDAQ1.00%Industrials27
Realty Income CorporationONYSE4.07%Real estate26
International Business MachinesIBMNYSE4.54%Information Technology26
NextEra Energy IncNEENYSE1.89%Utilities26

Table last updated: October 2021

ad

What are Dividend Kings?

Dividend Kings, like Dividend Aristocrats, are also an elite group of stocks. To be a Dividend King, the stock must have paid and increased their dividends every year for the last 50 years. Stocks such as Dover (DOV), 3M (MMM), Emerson Electric (EMR), Genuine Parts (GPC), Proctor & Gamble (PG), and Coca Cola (KO) are some of the Dividend Kings.

dividend kings

Should I Invest in Dividend Aristocrat Stocks?

Investors looking to benefit from the stability of the Dividend Aristocrats can consider investing in them for a steady source for income for the long term. It is important to note that the dividend aristocrats do not necessarily provide the highest dividend yield, but they are attractive for their consistency.

Additionally, dividend aristocrats may not be the best option for investors seeking rapid growth via capital gains. For example, the stocks such as Tesla, Amazon have brought in tremendous gains for their investors via capital gains (increase in stock price) but they are not dividend aristocrats.

Other Considerations

Due to the different treatment of dividend income as compared to capital gains, investors must also consider the tax implications before investing in dividend aristocrat stocks. Investing in these stocks in a tax advantaged account such as a 401(k), IRA, or Roth IRA might be more suitable for certain investors.

ad


Is there an ETF for investing in Dividend Aristocrats?

Two popular ETFs for investing in the Dividend Aristocrat Stocks are the following:

  • NOBL – ProShares S&P 500 Dividend Aristocrats ETF
  • SDY – SPDR S&P Dividend ETF

What are Technology Dividend Aristocrats?

Technology Dividend Aristocrats are a group of well established technology and technology-related companies that have paid and raised their dividends every year for the last seven years or more.

Technology Dividend Aristocrats are high quality stocks that have stable earnings and robust fundamentals.

What Stocks or Companies are Technology Dividend Aristocrats?

There are 36 companies on the list of Technology Dividend Aristocrats. Here’s the complete list of stocks.

StockExchangeTicker SymbolDividend Yield
Accenture plcNYSEACN1.09%
Activision Blizzard, IncNASDAQATVI0.58%
Amphenol CorporationNYSEAPH0.74%
Analog Devices, Inc.NASDAQADI1.53%
Apple Inc.NASDAQAAPL0.59%
Automatic Data Processing, Inc.NASDAQADP1.70%
Avnet, Inc.NASDAQAVT2.55%
Badger Meter, Inc.NYSEBMI0.77%
Broadcom Inc.NASDAQAVGO2.70%
Broadridge Financial Solutions,NYSEBR1.39%
Cass Information Systems, IncNASDAQCASS2.66%
CDW CorporationNASDAQCDW0.87%
Cisco Systems, Inc.NASDAQCSCO2.65%
Corning IncorporatedNYSEGLW2.71%
CSG Systems International, Inc.NASDAQCSGS2.03%
Hewlett Packard Enterprise CompNYSEHPE3.23%
HP Inc.NYSEHPQ2.57%
International Business MachinesNYSEIBM5.24%
Intuit Inc.NASDAQINTU0.44%
Jack Henry & Associates, Inc.NASDAQJKHY1.12%
KLA CorporationNASDAQKLAC1.23%
Littelfuse, Inc.NASDAQLFUS0.76%
Mastercard IncorporatedNYSEMA0.49%
Microchip Technology IncorporatNASDAQMCHP1.21%
Microsoft CorporationNASDAQMSFT0.80%
Motorola Solutions, Inc.NYSEMSI1.16%
National Instruments CorporatioNASDAQNATI2.68%
NetApp, Inc.NASDAQNTAP2.21%
Oracle CorporationNYSEORCL1.32%
Paychex, Inc.NASDAQPAYX2.16%
PetMed Express, Inc.NASDAQPETS4.55%
Power Integrations, Inc.NASDAQPOWI0.52%
QUALCOMM IncorporatedNASDAQQCOM2.07%
TE Connectivity Ltd. New Switz.NYSETEL1.36%
Texas Instruments IncorporatedNASDAQTXN2.34%
Visa Inc.NYSEV0.55%
List of Technology Dividend Aristocrats [updated Oct 28, 2021]

Technology Dividend Aristocrat Stocks Interactive Table

StockTicker SymbolExchangeDividend Yield
Accenture plcACNNYSE1.09%
Activision Blizzard, IncATVINASDAQ0.58%
Amphenol CorporationAPHNYSE0.74%
Analog Devices, Inc.ADINASDAQ1.53%
Apple Inc.AAPLNASDAQ0.59%
Automatic Data Processing, Inc.ADPNASDAQ1.70%
Avnet, Inc.AVTNASDAQ2.55%
Badger Meter, Inc.BMINYSE0.77%
Broadcom Inc.AVGONASDAQ2.70%
Broadridge Financial Solutions,BRNYSE1.39%
Cass Information Systems, IncCASSNASDAQ2.66%
CDW CorporationCDWNASDAQ0.87%
Cisco Systems, Inc.CSCONASDAQ2.65%
Corning IncorporatedGLWNYSE2.71%
CSG Systems International, Inc.CSGSNASDAQ2.03%
Hewlett Packard Enterprise CompHPENYSE3.23%
HP Inc.HPQNYSE2.57%
International Business MachinesIBMNYSE5.24%
Intuit Inc.INTUNASDAQ0.44%
Jack Henry & Associates, Inc.JKHYNASDAQ1.12%
KLA CorporationKLACNASDAQ1.23%
Littelfuse, Inc.LFUSNASDAQ0.76%
Mastercard IncorporatedMANYSE0.49%
Microchip Technology IncorporatMCHPNASDAQ1.21%
Microsoft CorporationMSFTNASDAQ0.80%
Motorola Solutions, Inc.MSINYSE1.16%
National Instruments CorporatioNATINASDAQ2.68%
NetApp, Inc.NTAPNASDAQ2.21%
Oracle CorporationORCLNYSE1.32%
Paychex, Inc.PAYXNASDAQ2.16%
PetMed Express, Inc.PETSNASDAQ4.55%
Power Integrations, Inc.POWINASDAQ0.52%
QUALCOMM IncorporatedQCOMNASDAQ2.07%
TE Connectivity Ltd. New SwitzeTELNYSE1.36%
Texas Instruments IncorporatedTXNNASDAQ2.34%
Visa Inc.VNYSE0.55%

How to invest in Technology Dividend Aristocrats

The ETF from ProShares S&P TECHNOLOGY DIVIDEND ARISTOCRATS ETF (TDV) aims to track the performance of the Technology Dividend Aristocrats Index.

Any company in the Technology Dividends Aristocrats Index must have increased dividend payments each year for at least seven years, its shares must be listed on a U.S. national securities exchange, and must meet certain minimum liquidity requirements.

Currently the index contains 36 stocks, such as Intuit (INTU), Motorola Solutions (MSI), Paychex (PAYX), Analog Devices (ADI), NetApp (NTAP), and Qualcomm (QCOM) etc.

Dividend Taxes

A dividend is a form of income that investors receive. Depending on your tax-filing status, there may be tax consequences on your dividend income. The taxes on dividend income also vary depending on whether your dividends are classified as ‘qualified dividends‘ or ‘ordinary dividends‘.

Ordinary Dividends are also called ‘non-qualified dividends’.

What Dividends are Qualified?

The IRS treats qualified dividends favorably and taxes them at a lower rate. A dividend is considered ‘qualified’ where certain conditions are met.

  • Generally, to be considered a ‘qualified dividend‘, the dividend must be paid by a US company. In some cases, certain foreign companies’ dividends may also be considered.
  • The dividend must be paid out by a for-profit organization. Dividends from tax-exempt organization are not considered.
  • The investor must hold the underlying stock (or any security that pays dividends) for more than 60 days in the qualifying period. The qualifying period is determined by the ex-dividend date. If the ex-dividend date is D, the qualifying period is (D – 60) days to (D + 60) days.
qualifying dividend holding period
Qualified Dividend: Qualifying Period

This is information of general nature. For details and exceptions, please refer IRS Publication 550.

Qualified Dividend vs Ordinary Dividend

Any dividend that does not satisfy all the criteria for being considered ‘qualified dividend‘ may be treated as ‘ordinary dividend‘. While qualified dividends are given preferential treatment and investors (almost always) pay lower taxes on them, the ordinary dividends are usually taxed at the same tax rate as the investor’s personal income tax rate.

Thankfully, your brokerage accounts should clearly specify whether the dividends you receive are ‘qualified’ or ‘ordinary’ in the tax forms, taking the burden away from you of classifying the dividends.

Qualified Dividend Taxes

Qualified Dividends are taxed at three different rates. Depending on taxable income and tax filing status, the tax rate for qualified dividends can be 0%, 15%, or 20%. It’s important to note that while the personal income tax rates in the US can be as high as 37%, the maximum tax rate on qualified dividends is 20%.

Here’s how the tax rates are determined for qualified dividends.

  • 0% on any amount that otherwise would be taxed at a 10% or 15% rate (personal income tax rate),
  • 15% on any amount that otherwise would be taxed at rates between 15% and 37% (personal income tax rate), and
  • 20% on any amount that otherwise would be taxed at a 37% rate (personal income tax rate)

Understandably, people in higher tax brackets, i.e. higher annual income pay a higher dividend tax rate on qualified dividends as well.

This is information of general nature. For details and exceptions, please refer IRS Publication 550.


ad

Fresh from the Blog

Read more: Stocks, ETFs, Mutual Funds, Bitcoins, Alternative Investing, Dividends.

Useful Tools: Student Loan Payoff Calculator | Mortgage Payoff Calculator
FinPins Home Page | FinPins BLOG Page
StartOptions Home Page
ad



Updated: October 28, 2021 by FinPins

ad