In this article, we will be looking at the 10 best stocks to buy with 50+ years of dividend increases. If you want to skip our detailed analysis of dividend investing, you can go directly to the 5 Best Stocks to Buy With 50+ Years of Dividend Increases.
Investing in dividend stocks with strong fundamentals offers two benefits: stock price appreciation and regular payouts. Dividend-paying stocks also provide a strong cushion of safety during times of crisis. For example, over the last 12 months alone, iShares Select Dividend ETF (NASDAQ:DVY), an exchange-traded fund that offers exposure to a number of high-yield stocks, has gained more than 40%, outperforming the S&P 500 ETF (NYSEARCA:SPY) by more than 4.0 percentage points.
In a Guinness Atkinson report on why investors should opt for dividend stocks, the claim above was further supported by mention of a Greenrock Research study which revealed that since the late 1950s, a hypothetical portfolio geared towards dividend stocks outperformed the "overall benchmark S&P 500" by about 2.2% each year. And while the study also mentioned that dividend stocks don't always outperform the stock market every year, it also stated that between 1958 and 2017, they did outperform the larger market in about 53% of the 60 years studied.
Apart from merely focusing on the outperformance of dividend stocks as compared to other stocks, the GA report also offered other incentives for investing in dividends. Two major reasons provided by the report are still highly relevant today: first, dividends grow, providing not only a stable passive income stream, but also one that often continues to gain value as the years pass, and second, dividend growth that historically surpassed the rate of inflation. On the first point, the report mentions that in the aggregate, dividend investors can expect a dividend growth rate of about 5%, as historically, the rate of growth of the S&P 500's own dividend has been about 5.81% since 1958.
As for the second point, Guinness Atkinson cited data stating that between 1958 to 2017, the S&P 500's dividend rose higher than inflation 62% of the times between the 60 years recorded. As such, dividend stocks have proven to be traditional outperformers and fast growers, making stocks with stable dividend yields like The Procter & Gamble Company (NYSE:PG), The Coca-Cola Company (NYSE:KO), Johnson & Johnson (NYSE:JNJ), Colgate-Palmolive Company (NYSE:CL), Brown-Forman Corporation (NYSE:BF-B), and Altria Group, Inc. (NYSE:MO) become even more attractive investment options.
And while building a portfolio of dividend stocks can give you a solid chance of outperforming the market, another metric that can help you beat the SPY is the hedge fund sentiment. Insider Monkey’s research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETF by more than 124 percentage points since March 2017. Between March 2017 and February 26th 2021 our monthly newsletter’s stock picks returned 197.2%, vs. 72.4% for the SPY. Our stock picks outperformed the market by more than 124 percentage points (see the details here). We were also able to identify in advance a select group of hedge fund holdings that significantly underperformed the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 13% through November 16th. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to. You can subscribe to our free newsletter on our homepage to receive our stories in your inbox.
Without further ado, let's look at the 10 best stocks to buy with 50+ years of dividend increases. The stocks added to our list were selected on the basis of hedge fund popularity, analysts' ratings, fundamentals, and growth potential based on core business strengths.
We also ensured each stock had increased its dividend for at least 50 years in a row as an indicator that the stock has a stable dividend.
Best Stocks to Buy With Over 50 Years of Dividend Increases
Number of Hedge Fund Holders: 10 Number of Years of Consistent Dividend Growth: 65 Dividend Yield: 3.7%
Northwest Natural Holding Company (NYSE: NWN) provides regulated natural gas distribution services to residential, commercial, industrial, and transportation customers in the US through its subsidiary, Northwest Natural Gas Company. It ranks 10th on our list of the best stocks to buy with 50+ years of dividend increases.
This May, Wells Fargo raised its price target on Northwest Natural Holding Company (NYSE: NWN) to $58, with an Equal Weight rating on the shares. The company also stated that it expects its 2021 EPS to be between $2.40 to $2.60, versus the consensus estimate of $2.51.
In the first quarter of 2021, Northwest Natural Holding Company (NYSE: NWN) had an EPS of $1.94, beating estimates by $0.12. The company's revenue was $315.95 million, up 10.80% year over year and surpassing the previous quarter's $260.27 million revenue. Northwest Natural Holding Company (NYSE: NWN) has also gained 17.03% in the past 6 months and 13.8% year to date.
By the end of the first quarter of 2021, 10 hedge funds out of the 866 tracked by Insider Monkey held stakes in Northwest Natural Holding Company (NYSE: NWN) worth roughly $28.3 million. This is compared to 10 hedge funds in the previous quarter with a total stake value of about $25.4 million.
Like The Procter & Gamble Company (NYSE: PG), The Coca-Cola Company (NYSE: KO), Johnson & Johnson (NYSE: JNJ), Brown-Forman Corporation (NYSE: BF-B), Altria Group, Inc. (NYSE: MO), and Colgate-Palmolive Company (NYSE: CL), Northwest Natural Holding Company (NYSE: NWN) is a good dividend stock to invest in.
Number of Hedge Fund Holders: 14 Number of Years of Consistent Dividend Growth: 66 Dividend Yield: 1.8%
American States Water Company (NYSE: AWR) is a provider of water and electric services to residential, commercial, industrial, and other customers in the US. The company ranks 9th on our list of the best stocks to buy with 50+ years of dividend increases.
In May, Wells Fargo raised its price target on American States Water Company (NYSE: AWR) shares from $81 to $87, keeping an Overweight rating on the shares. Analyst Jonathan Reeder went ahead with the price target increase in light of the company's quarterly results.
In the first quarter of 2021, American States Water Company (NYSE: AWR) had an EPS of $0.52, beating estimates by $0.07. The company's revenue was $117.06 million, up 7.32% year over year and beating estimates by $16.15 million. American States Water Company (NYSE: AWR) has gained 2.32% in the past 6 months and 5.37% year to date.
By the end of the first quarter of 2021, 14 hedge funds out of the 866 tracked by Insider Monkey held stakes in American States Water Company (NYSE: AWR) worth roughly $38.9 million. This is compared to 18 hedge funds in the previous quarter with a total stake value of about $46.1 million.
Like The Procter & Gamble Company (NYSE: PG), The Coca-Cola Company (NYSE: KO), Johnson & Johnson (NYSE: JNJ), Brown-Forman Corporation (NYSE: BF-B), Altria Group, Inc. (NYSE: MO), and Colgate-Palmolive Company (NYSE: CL), American States Water Company (NYSE: AWR) is a good dividend stock to invest in.
Number of Hedge Fund Holders: 22 Number of Years of Consistent Dividend Growth: 60 Dividend Yield: 2.1%
Cincinnati Financial Corporation (NASDAQ: CINF) is a property and casualty insurance company operating in the financials sector. The company provides property-casualty insurance products in the US and ranks 8th on our list of the best stocks to buy with 50+ years of dividend increases.
This July, Piper Sandler upgraded Cincinnati Financial Corporation (NASDAQ: CINF) from Underweight to Neutral, while also raising its price target from $100 to $116. Analyst Paul Newsome has also commented that concerns regarding business interruption insurance litigation are beginning to fade away where Cincinnati Financial Corporation (NASDAQ: CINF) is concerned.
In the first quarter of 2021, Cincinnati Financial Corporation (NASDAQ: CINF) had an EPS of $1.37, beating estimates by $0.27. The company's revenue was $2.23 billion, beating estimates by $547.92 million as well. Cincinnati Financial Corporation (NASDAQ: CINF) has gained 26.98% in the past 6 months and 40.49% year to date.
By the end of the first quarter of 2021, 22 hedge funds out of the 866 tracked by Insider Monkey held stakes in Cincinnati Financial Corporation (NASDAQ: CINF) worth roughly $886 million. This is compared to 20 hedge funds in the previous quarter with a total stake value of about $842 million.
Like The Procter & Gamble Company (NYSE: PG), The Coca-Cola Company (NYSE: KO), Johnson & Johnson (NYSE: JNJ), Brown-Forman Corporation (NYSE: BF-B), Altria Group, Inc. (NYSE: MO), and Colgate-Palmolive Company (NYSE: CL), Cincinnati Financial Corporation (NASDAQ: CINF) is a good dividend stock to invest in.
Number of Hedge Fund Holders: 26 Number of Years of Consistent Dividend Growth: 65 Dividend Yield: 2.5%
Genuine Parts Company (NYSE: GPC) is a distributor of automotive replacement parts, and industrial parts and materials for imported vehicles, hybrid or electric vehicles, trucks, SUVs, buses, motorcycles, and other vehicles. It ranks 7th on our list of the best stocks to buy with 50+ years of dividend increases.
This May, Goldman Sachs upgraded Genuine Parts Company (NYSE: GPC) from Sell to Neutral while also raising its price target from $113 to $125. Analyst Kane McShane commented that auto parts retailers like Genuine Parts Company (NYSE: GPC) are set to profit from the economic recovery in light of the pandemic being fought by growing immunizations.
In the first quarter of 2021, Genuine Parts Company (NYSE: GPC) had an EPS of $1.50, beating estimates by $0.36. The company's revenue was $4.46 billion, also beating estimates by $161.17 million. Genuine Parts Company (NYSE: GPC) has gained 21.64% in the past 6 months and 29.68%.
By the end of the first quarter of 2021, 26 hedge funds out of the 866 tracked by Insider Monkey held stakes in Genuine Parts Company (NYSE: GPC) worth roughly $357 million. This is compared to 25 hedge funds in the previous quarter with a total stake value of about $194 million.
Like The Procter & Gamble Company (NYSE: PG), The Coca-Cola Company (NYSE: KO), Johnson & Johnson (NYSE: JNJ), Brown-Forman Corporation (NYSE: BF-B), Altria Group, Inc. (NYSE: MO), and Colgate-Palmolive Company (NYSE: CL), Genuine Parts Company (NYSE: GPC) is a good dividend stock to invest in.
Number of Hedge Fund Holders: 26 Number of Years of Consistent Dividend Growth: 57 Dividend Yield: 0.7%
Nordson Corporation (NASDAQ: NDSN) manufactures products and systems for the dispensation, application, and control of adhesives, coatings, polymers, sealants, biomaterials, and other fluids. The company operates globally and ranks 6th on our list of the best stocks to buy with 50+ years of dividend increases.
This July, DA Davidson raised its price target on Nordson Corporation (NASDAQ: NDSN) from $250 to $255, keeping a Buy rating on the company's shares. Analyst Matt Summerville commented that the increase in price target came about after his meeting with Nordson Corporation's (NASDAQ: NDSN) CFO, which implied that the company's underlying end demand is robust and widespread.
In the fiscal second quarter of 2021, Nordson Corporation (NASDAQ: NDSN) had an EPS of $2.12, beating estimates by $0.48. The company's revenue was $589.54 million, up 11.34% year over year and beating estimates by $41.77 million. Nordson Corporation (NASDAQ: NDSN) has also gained 8.89% in the past 6 months and 11.92% year to date.
By the end of the first quarter of 2021, 26 hedge funds out of the 866 tracked by Insider Monkey held stakes in Nordson Corporation (NASDAQ: NDSN) worth roughly $179 million. This is compared to 21 hedge funds in the previous quarter with a total stake value of about $70.7 million.
Like The Procter & Gamble Company (NYSE: PG), The Coca-Cola Company (NYSE: KO), Johnson & Johnson (NYSE: JNJ), Brown-Forman Corporation (NYSE: BF-B), Altria Group, Inc. (NYSE: MO), and Colgate-Palmolive Company (NYSE: CL), Nordson Corporation (NASDAQ: NDSN) is a good dividend stock to invest in.
