I think the companies on the Dividend Kings list more than earn the title “King.”
Not all companies pay dividends; even then, not all can consistently increase their dividend payouts. Certainly, not all can consistently weather economic turbulence, volatile interest rate periods, recessions, pandemics, and market crashes.
To reach Dividend King status, a company must increase its dividend payouts for 50 or more years. That means a solid business foundation, effective resource management, world-class brand recognition, and impressive adaptability to ever-changing consumer requirements and market conditions.
However, like with other categories, some Dividend Kings are better than others. “Better” is a relative term, as there are many metrics against which Dividend Kings can be measured.
With over 20 years of investing experience, I have some ideas about what constitutes “better.” So, let’s look at three of the highest-rated Dividend Kings today.
How I Chose the Stocks for This Article
Barchart’s free Stock Screener is essential for filtering through the market’s noise to get the best of your needs.
In this instance, I have a pre-prepared Dividend Kings watchlist, which I use for easy screening. Then, I searched for the following criteria to get the best of the best:
- Number of Analysts: Dividend Kings are easily some of the most covered companies by Wall Street analysts. Still, I like my consensus information from multiple trusted sources, so I filtered for companies covered by more than eight analysts.
- Current Analyst Rating: I searched for companies with strong buy ratings (4.5 to 5 in numerical value). This will be our primary metric.
These were the results:
Five results were on the list of dividend kings, but we’ll only take the top three. Again, analysts' ratings are our main metric, as this considers the stock's potential growth over the mid to long-term.
And so, I present the highest-rated Dividend Kings from lowest to highest for your consideration.
Becton Dickinson And Company (BDX)
Becton Dickinson and Co. is a multinational corporation that manufactures and distributes medical supplies and technology. The company operates in the following segments: BD Medical, BD Life Sciences, and BD Interventional.
Becton Dickinson’s Q1’24 statement had mixed results. Revenue did grow by 2.6% from the same period last year but reported diluted EPS was down by a massive 43.5%. A slight uptick in total operating costs and expenses, as well as income tax provisions for the start of the year, mainly caused this.
Still, it’s not all doom and gloom. Segment performance was mainly positive, with BD Interventional headlining the report with a 5.2% growth. Furthermore, the company has raised its 2024 revenue guidance from $20.3 billion to $20.4 billion on the high end.
BDX stock has a $3.80 forward annual dividend rate, translating to a 1.58% yield. This Dividend King has also raised dividends for 52 consecutive years and has a 4.53 analyst rating.
Emerson Electric Company (EMR)
Emerson Electric is a well-known dividend company that offers engineering and software solutions to businesses worldwide. The company’s client base includes industrial-grade consumer operations and boasts a wide range of products and services catering to many businesses and market sectors.
If the FY'23 financials are any indication (which it is), the company has been doing well lately. Net sales are up 10% YOY, while adjusted EPS registered a 22% growth. Free cash flow—an excellent measure of any company’s financial health—also grew by 35%.
EMR pays a $0.525 quarterly dividend, translating to a $2.10 forward annual rate or a 1.84 yield based on its latest trading price. Notably, the company has also increased its dividend for 67 consecutive years. Analysts rate EMR stock 4.55 out of 5—and it's the only stock with a technical “100% Buy” rating based on Barchart Opinion.
S&P Global (SPGI)
S&P Global should be a familiar name to anyone even remotely interested in stock investments. The company provides global credit ratings and financial intelligence, including ratings and research for various firms worldwide.
As the name suggests, the company also maintains and markets indices like the S&P 500.
Dividend Kings as big as S&P Global typically don’t report triple-digit financial growth; it’s one of the defining features of a mature, stable company that practically cannot be dislodged from the top of its sector.
That said, the company’s FY’23 financials had some pretty decent numbers. Revenue and adjusted diluted EPS reported 6% and 7% growth, respectively. Dividends also grew 8%.
Speaking of which, SPGI has a $3.64 annualized dividend rate, reflecting a 0.86% yield. The company has also increased its dividend payouts for at least 51 consecutive years, and analysts rate SPGI stock a 4.84 out of 5—making SPGI the highest-rated dividend king today.
Final Thoughts
Companies on the Dividends Kings list offer consistent income for willing investors. These stock picks are perfect for people who want reliable income over long periods. However, just because a company is a “Dividend King” doesn’t mean it’s an automatic buy. Always scrutinize your stock picks, do your due diligence, and remember that dividend yields aren’t the end-all, be-all of investing.
On the date of publication, Rick Orford did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
