After more than 25 years of investing, some of my favorite stocks are the dividend kings. The dividend kings rise above a majority of dividend stocks that in the history of paying dividends. I’ve put together this blog post about what makes dividend kings so great and why you should consider including them as part of your investment strategy. Lastly, I have included and updated the complete Dividend Kings list for 2021.
A dividend is a payment or distribution from a company’s earnings. Typically it is associated with a class of shares. The rate and schedule are determined by the company’s board of directors. Shareholders are usually eligible for dividends as long as they own the stock.
Companies that pay dividends are typically more mature companies that are paying out a dividend as a source of earnings. Growth companies don’t usually pay out dividends because they try to invest all their earnings and increase the share price. Amazon is a great example of a growth company that does not pay a dividend.
What companies are dividend kings?
So what are the dividend kings stocks? The first criterion of a dividend king is its history of increasing its dividend each year for at least 50 years. A good history is not all that important by itself since a stock can continually increase its dividends each year without becoming a Dividend King. But if it has been doing so for many decades, the odds are that the stock will continue to increase its dividends in the foreseeable future (i.e., the probabilities are close to 100%).
The second criterion of a good dividend king is that it has never been liquidated. No shareholder would ever vote to liquidate his holding because he knows that if he did so, his investment would be worthless — and his losses greater — than his original investment. A stock that has been liquidated will have to start with zero dividends each year.
The total market cap of this portfolio is approximately $2.7 trillion dollars in total, more than double that of Apple alone (the largest company by market cap). These companies have an average dividend yield of 3.92%, a yield not seen since 2003 and one which I believe will increase in the future as interest rates decline further, thus making investments in these firms even more profitable.
Currently, there are 31 companies on the Dividend King List. These companies not only survived all the stock market booms and crashes but found a way to be profitable and pay a dividend.
Does this mean they will always pay a dividend? No, it doesn’t. Advisors and investors should not just buy all the stocks on the dividend king list. They need to research each one to make sure it.
What are the best dividend kings?
The best dividend kings for 2021 based on earnings and the current stock market environment are:
- Altria Group
- Hormel Foods
- Procter & Gamble
- Genuine Parts
Complete Dividend Kings Stock List 2021
Here is the Dividend Kings list as of May 2021. Please feel free to copy/paste the information for your own research.
|Ticker||Company||Sector||Price||Dividend Yield||Consecutive Div. Growth Years||Ex-Div. Date||Days Until Next Earnings Report||Beta 3-Year||YTD Return||3-Year Return|
|TR||Tootsie Roll Industries||Consumer Defensive||$32.03||1.10%||1||3/4/2021||64||0.27||11.40%||21.90%|
|HRL||Hormel Foods||Consumer Defensive||$45.99||2.10%||10+||4/9/2021||1||0.42||-0.30%||34.20%|
|MO||Altria Group||Consumer Defensive||$49.14||7.00%||10+||3/24/2021||69||0.69||21.90%||10.00%|
|NFG||National Fuel Gas||Energy||$51.49||3.50%||10+||3/30/2021||78||0.69||26.50%||12.20%|
|NWN||Northwest Natural Hldg||Utilities||$54.38||3.50%||10+||4/29/2021||79||0.93||20.60%||2.50%|
|CWT||California Water Service||Utilities||$56.01||1.60%||10+||5/7/2021||71||0.78||4.50%||53.10%|
|FUL||H.B. Fuller||Basic Materials||$66.91||1.00%||10+||4/21/2021||35||1.16||29.70%||33.60%|
|AWR||American States Water||Utilities||$76.60||1.80%||10+||5/14/2021||75||0.76||-2.80%||48.10%|
|CBSH||Commerce Bancshares||Financial Services||$77.06||1.40%||10+||6/3/2021||62||0.97||17.60%||43.40%|
|FRT||Federal Realty Investment||Real Estate||$111.00||3.80%||10+||6/21/2021||77||1.03||31.70%||8.80%|
|CINF||Cincinnati Financial||Financial Services||$117.44||2.20%||10+||6/16/2021||68||1.1||35.20%||79.90%|
|GPC||Genuine Parts||Consumer Cyclical||$129.38||2.50%||10+||6/3/2021||71||1.02||29.80%||53.30%|
|PG||Procter & Gamble||Consumer Defensive||$136.45||2.60%||10+||4/22/2021||71||0.64||-0.70%||100.30%|
|JNJ||Johnson & Johnson||Healthcare||$168.96||2.50%||10+||5/24/2021||57||0.64||8.00%||48.00%|
|LANC||Lancaster Colony||Consumer Defensive||$184.85||1.60%||10+||3/8/2021||99||0.71||1.00%||52.70%|
|LOW||Lowe’s Companies||Consumer Cyclical||$189.13||1.30%||10+||4/20/2021||–||1.15||18.60%||133.40%|
|SWK||Stanley Black & Decker||Industrials||$207.40||1.40%||10+||6/7/2021||71||1.44||16.60%||53.20%|
|FMCB||Farmers & Merchants||Financial Services||$875.00||1.70%||10+||6/10/2021||–||0.09||15.10%||36.90%|