Dividend Aristocrats

Who are the Dividend Aristocrats?  These are stocks which have increased their dividend payouts for the past consecutive 25 years.  This is an elite grouping created and maintained by the rating agency, Standard & Poors.  There are many familiar company names among this group, and there are also some that you may never have heard of.  There are currently 52 stocks in this group.

Are Dividends Really That Important?

Dividends have been proven to significantly enhance investor returns. Here are some figures from 2 different time periods:

1. 1926 - 2004: Dividends accounted for 35% of shareholder returns. However, when you add in the effect of compounding, dividends returned over 25 times more than price appreciation.

2. 1986 - 2005: $1.00 invested in the S&P 500 had $.45 in price appreciation. If you include reinvested dividends, however, that $1.00 would have earned $8.09, 18 times as much as mere price appreciation.

2009 Q2 Dividend Aristocrats By Sector

STOCKS
TICKER
SECTOR
8/04/09 CLOSING PRICE
CURRENT YIELD %
ANNUAL DIVIDEND/SHARE
McDonald's Corporation
MCD
Consumer Discretionary
$55.01
1.45%
$0.80
Sherwin-Williams Company
SHW
Consumer Discretionary
$60.73
2.34%
$1.42
Family Dollar Stores, Inc.
FDO
Consumer Discretionary
$31.06
1.80%
$0.56
Target Corporation
TGT
Consumer Discretionary
$42.17
1.61%
$0.68
V.F. Corporation
VFC
Consumer Discretionary
$66.12
3.57%
$2.36
Lowe's Companies, Inc.
LOW
Consumer Discretionary
$22.61
1.59%
$0.36
Leggett & Platt, Inc.
LEG
Consumer Discretionary
$17.76
5.63%
$1.00
The McGraw-Hill Companies, Inc.
MHP
Consumer Discretionary
$31.09
2.89%
$0.90
The Stanley Works
SWK
Consumer Discretionary
$41.40
3.09%
$1.28
Johnson Controls, Inc.
JCI
Consumer Discretionary
$26.76
1.94%
$0.52
Gannett Co., Inc.
GCI
Consumer Discretionary
$7.48
2.14%
$0.16
Wal-Mart Stores, Inc.
WMT
Consumer Staples
$49.85
2.19%
$1.09
The Procter & Gamble Company
PG
Consumer Staples
$55.46
3.17%
$1.76
The Clorox Company
CLX
Consumer Staples
$58.75
3.40%
$2.00
The Coca-Cola Company
KO
Consumer Staples
$49.50
3.31%
$1.64
PepsiCo, Inc.
PEP
Consumer Staples
$59.06
3.05%
$1.80
Kimberly-Clark Corporation
KMB
Consumer Staples
$59.15
4.06%
$2.40
Walgreen Company
WAG
Consumer Staples
$30.39
1.81%
$0.55
SUPERVALU INC.
SVU
Consumer Staples
$14.95
4.62%
$0.69
Archer Daniels Midland Company
ADM
Consumer Staples
$28.81
1.94%
$0.56
Exxon Mobil Corporation
XOM
Energy
$70.60
2.38%
$1.68
The Chubb Corporation
CB
Financials
$48.56
2.88%
$1.40
Cincinnati Financial Corporation
CINF
Financials
$25.00
6.24%
$1.56
BB&T Corporation
BBT
Financials
$23.66
2.54%
$0.60
M&T Bank Corporation
MTB
Financials
$58.99
4.75%
$2.80
Legg Mason, Inc.
LM
Financials
$27.82
0.43%
$0.12
U.S. Bancorp
USB
Financials
$21.70
0.92%
$0.20
AFLAC Incorporated
AFL
Financials
$39.85
2.81%
$1.12
State Street Corporation
STT
Financials
$54.07
0.07%
$0.04
Abbott Laboratories
ABT
Health Care
$44.30
3.61%
$1.60
C.R. Bard, Inc.
BCR
Health Care
$75.00
0.91%
$0.68
Becton, Dickinson and Co.
BDX
Health Care
$65.55
2.01%
$1.32
Eli Lilly & Co.
LLY
Health Care
$35.06
5.59%
$1.96
Johnson & Johnson
JNJ
Health Care
$61.06
3.21%
$1.96
Pfizer Inc.
PFE
Health Care
$16.07
3.98%
$0.64
Pitney Bowes Inc.
PBI
Industrials
$20.96
6.87%
$1.44
Emerson Electric Co.
EMR
Industrials
$36.12
3.65%
$1.32
W.W. Grainger, Inc.
GWW
Industrials
$90.36
2.04%
$1.84
Dover Corporation
DOV
Industrials
$34.68
2.88%
$1.00
Avery Dennison Corporation
AVY
Industrials
$27.23
6.02%
$1.64
3M Company
MMM
Industrials
$72.03
2.83%
$2.04
General Electric Company
GE
Industrials
$13.82
2.89%
$0.40
Automatic Data Processing
ADP
Information Technology
$37.93
3.48%
$1.32
Bemis Company, Inc.
BMS
Materials
$27.13
3.32%
$0.90
Sigma-Aldrich Corporation
SIAL
Materials
$52.51
1.10%
$0.58
Air Products & Chemicals, Inc.
APD
Materials
$74.63
2.41%
$1.80
PPG Industries, Inc.
PPG
Materials
$57.04
3.72%
$2.12
CenturyTel, Inc.
CTL
Telecommunication Services
$31.51
8.89%
$2.80
Consolidated Edison, Inc.
ED
Utilities
$39.50
5.97%
$2.36
Questar Corporation
STR
Utilities
$34.10
1.52%
$0.52
Integrys Energy Group, Inc.
TEG
Utilities
$34.23
0.47%
$0.16

Einstein and Dividends

No, you don't need to be a physicist to understand how dividends work, but a quick anecdote about one of the world's most famous geniuses does help to shed some light on the power of this investment feature.

When asked which invention he thought was man's most amazing, Einstein reputedly said,   "Compound Interest".  Reinvesting dividends harnesses the power of compound interest for an investor's account, allowing their initial investment to grow much more quickly over time.  Indeed, this is one of the greatest opportunities for kids - if you can get them interested in investing and saving money at a young age, they'll have the advantage of time working in their favor, as those dividends just keep compounding every year, year after year.  

DRIP Plans - How to reinvest dividends

Many publicly traded companies have what's known as a DRIP, or Dividend Reinvestment Plan, through which they allow the public to purchase shares directly from the company, thereby saving brokerage commissions.  The company will make sure that all of your dividends are reinvested.  

I've listed a website below, in the links section, that supports a community of "drip" investors, and has helpful information about different plans, and how to get started.

Comments 2 comments

yamanote profile image

yamanote 7 years ago from UK/Spain

I wasn't aware of this term - very useful. Its funny that BHathaway never pays dividends :-)


wannabwestern profile image

wannabwestern 6 years ago from The Land of Tractors

An excellent article, with great dividend-paying stock choices. Thank you!

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