The S&P 500 Dividend Aristocrats index looks only a little different as we head into the second half of the year.
Widely regarded as some of the best dividend stocks for dependable dividend growth, the S&P 500 Dividend Aristocrats is an index of S&P 500 companies that have raised their dividends for at least 25 consecutive years.
That's kind of a big deal if you are a long-term equity income investor. Regular dividend hikes not only increase the yield on an investor's original cost basis over time, often quite dramatically; they also help investors sleep better at night.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
After all, any company that manages to raise its dividend year after year – through recession, war, market crashes and more – is demonstrating both its financial resilience and its commitment to returning cash to shareholders.
S&P Dow Jones Indices, which rebalances the index quarterly, ditched Walgreens Boots Alliance (WBA) at the beginning of 2024 after the pharmacy chain slashed its dividend by almost half.
Walgreens had increased its dividend every year for nearly half a century before the cut. Analysts, who regularly give WBA one of the lowest rankings of all 30 Dow Jones stocks, applauded the decision to take cash earmarked for shareholders and invest it back into the business.
Perhaps most interesting is what will happen to long-time member 3M (MMM). The Dow stock is on the Aristocrats chopping block after slashing its dividend as part of its Solventum (SOLV) spin off. 3M is expected to be cut from the list of dependable dividend payers when S&P Dow Jones next rebalances the index.
Dividend Aristocrats Fastenal and Kenvue
The Dividend Aristocrats membership list remains at 67 stocks, however, as Fastenal (FAST) was added to the index in the first quarter of 2024. The industrial supplier has raised its dividend for 25 consecutive years, making it available for inclusion in the index.
Most recently, Fastenal declared a quarterly cash dividend of 39 cents per share to be paid on February 29 to shareholders of record as of February 1. The company generated more than $1 billion in levered free cash flow in fiscal 2023, and that was after paying out more than a billion dollars in dividends.
Fastenal stock sports a dividend yield of 2.4%, which is fairly generous for an Aristocrat. The exchange-traded fund that tracks the index, the ProShares S&P 500 Dividend Aristocrats ETF (NOBL), has a dividend yield of 2.1%.
Other changes to the Dividend Aristocrats over the past year include the removal of VF Corp. (VFC) and the addition of Kenvue (KVUE), which was spun off from fellow Aristocrat Johnson & Johnson (JNJ).
Related Content
-
Target Unveils New Gift Card Design to Combat FraudWith gift card fraud on the rise, some states are cracking down, requiring retailers to change how they sell gift cards.
-
Apple Proposes $95 Million Lawsuit Settlement Following Siri Spying AllegationsApple wants to a settle a five-year lawsuit, where plaintiffs accused the tech giant of using Siri to record conversations to sell to advertisers.
-
Are Democrats or Republicans Better for My Insurance Premiums?Let's compare how these two political parties might affect your insurance premiums now that the 2024 election is over.
-
Stock Market Today: Stocks Start the New Year With a HangoverEquities continued their post-holiday slide as investors fled risk assets.
-
Four Financial Steps That Can Help the Sandwich Generation CopePeople who are caring for kids and aging parents at the same time can take a hit mentally and financially, so make sure you're tapping into all available help.
-
Investing Moves to Make at the Start of the YearAfter another big year for stocks in 2024, investors may want to diversify in 2025. Here are five portfolio moves to make at the start of the year.
-
Three Easy But High-Impact Moves for RetireesKeeping finances in order is a chore, especially in retirement, but these three simple and impactful moves will help you now (and your heirs in the future).
-
Stock Market Today: Stocks End a Strong Year With a WhimperThe S&P 500 notched its first back-to-back 20%+ annual returns since the late 1990s.
-
What's in Store for the Bull Market in 2025?The current bull market recently turned two and most – but not all – Wall Street pros expect the party to continue in the new year.
-
Buckle Up: Five Risks to Avoid on the Road to RetirementAs retirement approaches, keep an eye out for the last remaining bumps in the road that could put a serious dent in your hard-earned savings.
