Young Research & Publishing Inc.

Investment Research Since 1978

Disclosure

  • About Us
    • Contributors
    • Archives
    • Dick Young’s Safe America
    • The Final Richard C. Young’s Intelligence Report
    • You’ve Read The Last Issue of Intelligence Report, Now What?
    • Dick Young’s Research Key: Anecdotal Evidence Gathering
    • Crisis at Vanguard
  • Investment Analysis
    • Bonds
    • Currencies and Gold
    • Dividend Investing
    • ETFs & Funds
    • Investment Strategy
    • Retirement Investing
    • Stocks
    • The Efficient Frontier
  • Investment Counsel
  • Dynamic Maximizers®
  • Retirement Compounders®
  • Free Email Signup

Dividend Kings: Are Dividend Kings the Best Dividend Stocks to Buy?

December 3, 2019 By Jeremy Jones, CFA

What are Dividend Kings, and should you invest in Dividend King stocks? You may have heard of Dividend Achievers or Dividend Aristocrats, but what exactly is a Dividend King? And are Dividend Kings the best stocks to buy?

Dividend Kings seems to be an outgrowth of the Dividend Achievers and Dividend Aristocrats lists started by Moody’s and S&P.

Dividend Kings - a chess king piece in front of a stock ticker and $100 bills

By isak55 @ Shutterstock.com

As a reminder, Dividend Achievers are companies that have increased their annual dividend payments every year for at least ten consecutive years.

Dividend Aristocrats are S&P 500 companies that have increased their dividends for at least 25 consecutive years.

The Definition of a Dividend King

So then what exactly is a Dividend King?

According to the “internet,” Dividend Kings are S&P 500 companies that have paid a dividend for at least 50 consecutive years. Well, that is, according to some people on the internet.

According to others, a Dividend King doesn’t have to be an S&P 500 company. Any company that has increased its dividend for 50 consecutive years is a Dividend King.

Confused?

We are too, and we have been investing in companies that pay dividends and make regular annual dividend increases since before many of these terms were even a thing.

As far as we can tell, “Dividend Kings” is an invention of the internet.

The problem with the internet is…well, you know.

The problem with the Dividend Kings is that there isn’t a sound investment case for the 50-year rule.

What is significant about 50 years of dividend hikes vs. 25 years? Yes, we would agree more is generally better, but why not 40 years or 30 years?

Are Dividend Kings Better than Dividend Achievers or Dividend Aristocrats?

Do Dividend Kings perform better than other dividend growth stocks? Maybe, but there isn’t enough data to draw a statistically significant conclusion on the performance of Dividend King stocks.

We dug through some of our back issues of the Dividend Achiever’s Handbook to provide historical context.

In 2002 there was only one company that would have qualified as a Dividend King. That company was Aon.

In 2007 there were seven companies that qualified as Dividend Kings. Aon wasn’t one of them as the company cut its dividend in 2003.

Of the seven that qualified in 2007, two have since lost Dividend King status. That’s about a 30% dropout rate.

The average return of an equally weighted portfolio of those seven companies has done better than the S&P 500 since 2007, but it has performed no better than the Dividend Aristocrats Index. And don’t forget we are only talking about a sample size of seven. Two stocks account for most of the return.

Today, there are 24 companies that would qualify. There are some outstanding firms that make the list, but investors buying stocks simply because they meet the definition of a Dividend King may be disappointed with the results. See the table below for the full list of Dividend Kings.

The Dividend Kings List: What Companies Qualify?

Company Yield Years of Increases
American States Water Co. (AWR) 1.44% 65
Procter & Gamble (PG) 2.43% 65
Dover Corp. (DOV) 1.78% 63
Northwest Natural Gas Co. (NWN) 2.78% 63
Emerson Electric Co. (EMR) 2.71% 62
Genuine Parts Co. (GPC) 2.91% 62
3M Co. (MMM) 3.42% 60
Cincinnati Financial Corp. (CINF) 2.12% 58
Lowe’s Companies Inc. (LOW) 1.90% 57
The Coca-Cola Co. (KO) 2.98% 56
Colgate-Palmolive Co. (CL) 2.55% 56
Illinois Tool Works, Inc. (ITW) 2.49% 56
Tootsie Roll Industries Inc. (TR) 1.05% 55
ABM Industries, Inc. (ABM) 1.91% 54
Johnson & Johnson (JNJ) 2.76% 54
Altria Group Inc. (MO) 6.76% 53
Hormel Foods Corp. (HRL) 2.05% 52
California Water Service Group (CWT) 1.54% 51
Federal Realty Investment Trust (FRT) 3.24% 51
H.B. Fuller Company (FUL) 1.28% 51
Stanley Black & Decker, Inc. (SWK) 1.80% 51
Stepan Co. (SCL) 1.15% 51
Commerce Bancshares, Inc. (CBSH) 1.56% 50
SJW Group (SJW) 1.70% 50

Share this:

  • Email
  • Twitter
  • Facebook

You Might Also Like:

  • Four Questions You Should Ask Before Investing in Stocks
  • The Dividend Plan
  • Cash Kings
  • Understanding Dividend Dates
  • The Highest Yielding S&P 500 Stocks
  • Author
  • Recent Posts
Jeremy Jones, CFA
Jeremy Jones, CFA, CFP® is the Director of Research at Young Research & Publishing Inc., and the Chief Investment Officer at Richard C. Young & Co., Ltd. Richard C. Young & Co., Ltd. was ranked #5 in CNBC's 2021 Financial Advisor Top 100. Jeremy is also a contributing editor of youngresearch.com.
Latest posts by Jeremy Jones, CFA (see all)
  • Resilient Nordic Market Spawns Fast Growing Offshoot - August 9, 2022
  • SHOCK: Home Prices FALL in San Francisco as Market Dries Up - August 8, 2022
  • Despite All the Money Involved, Crypto Is Still a Wild Market - August 5, 2022

Search Young Research

Most Popular

  • The Key Ingredient to an $8 Million Estate Is This
  • SCHUMER-MANCHIN: An "Inflation" Bill that Doesn't Fight Inflation
  • NO GO ZONES: The Wealthy Protected, the Rest Left to Rot
  • Do Governments Cause Recessions On Purpose?
  • The Power of a Compound Interest Table
  • American Manufacturers ALARMED by Schumer-Manchin Tax Hike Plan
  • Is a Housing Market Crash Next?
  • Do You Have $500,000 in Savings? Avoid This Nightmare
  • Field of Dreams: You Too Can Live Like a Billionaire
  • Vanguard Wellesley (VWINX) vs. Wellington (VWELX): Which Fund is Best?

Don’t Miss

Default Risk Among the Many Concerns with Annuities

Risk and Reward: An Efficient Frontier

How to be a Billionaire: Proven Strategies from the Titans of Wealth

Could this Be the Vanguard GNMA Winning Edge?

Cryptocosm and Life After Google

Warning: Avoid Mutual Fund Year End Distributions

Is Gold a Good Long-term Investment?

How to Invest in Gold

Vanguard Wellington (VWELX): The Original Balanced Fund

What is the Best Gold ETF for Investing and Trading?

Procter & Gamble (PG) Stock: The Only True Dividend King

The Dividend King of the North

You’ll Love This if You’re Dreaming of an Active Retirement Life

RSS The Latest at Richardcyoung.com

  • DeSantis Leadership: Good Government and Smart Politics
  • The Most Vulnerable Will Suffer at the Hands of Anthony Fauci
  • If the Phone Doesn’t Ring…It’s Me
  • REGION AT RISK? Chaos of War Surrounds Ukrainian Nuclear Plant
  • Did China Buy Land in North Dakota to Spy on Air Force Base?
  • 2.5 YEARS LATER: Economy Recovers Jobs Lost in Democrat Lockdowns
  • Immigrants Poised to FLOOD THE BORDER After Democrats Reject Title 42
  • STAND UP FOR MAIN STREET AMERICA! Subscribe to My Free Weekly Email
  • A Conservative Case for Optimism
  • What’s Up in the Amazon?

About Us

  • About Young Research
  • Archives
  • Contributors

Our Partners

  • Richard C. Young & Co.
  • Richardcyoung.com

Copyright © 2022 | Terms & Conditions

 

Loading Comments...
 

    loading Cancel
    Post was not sent - check your email addresses!
    Email check failed, please try again
    Sorry, your blog cannot share posts by email.