First Published on June 30th, 2023 by Bob Ciura for SureDividend
The Dividend Aristocrats are the ‘best of the best’ dividend growth stocks. The Dividend Aristocrats have a long history of outperforming the market.
Dividend Aristocrats are elite companies that satisfy the following:
- •Are in the S&P 500 Index
- •Have 25+ consecutive years of dividend increases
- •Meet certain minimum size & liquidity requirements
You can download an Excel spreadsheet with the full list of all 67 Dividend Aristocrats (with additional financial metrics such as price-to-earnings ratios and dividend yields) by clicking the link below:
All Dividend Aristocrats are high-quality businesses based on their long dividend histories. A company cannot pay rising dividends for 25+ years without having a strong and durable competitive advantage.
But not all Dividend Aristocrats make equally good investments today. Some Dividend Aristocrats are better than others, based on the sustainability of their dividends.
That’s why, in this article, we have analyzed the 10 safest Dividend Aristocrats from our Sure Analysis Research Database with the safest dividends based on our Dividend Risk Score rating system.
The stocks below are all Dividend Aristocrats with Dividend Risk Scores of ‘A’, the top rating, and with the lowest payout ratios.
Table of Contents
- •Safest Dividend Aristocrats #10: Expeditors International of Washington (EXPD)
- •Safest Dividend Aristocrats #9: Pentair plc (PNR)
- •Safest Dividend Aristocrats #8: Dover Corporation (DOV)
- •Safest Dividend Aristocrats #7: W.W. Grainger (GWW)
- •Safest Dividend Aristocrats #6: Chubb Limited (CB)
- •Safest Dividend Aristocrats #5: Brown & Brown (BRO)
- •Safest Dividend Aristocrats #4: Roper Technologies (ROP)
- •Safest Dividend Aristocrats #3: Nucor Corp. (NUE)
- •Safest Dividend Aristocrats #2: West Pharmaceutical Services (WST)
- •Safest Dividend Aristocrats #1: Albemarle Corp. (ALB)
Safest Dividend Aristocrats #10: Expeditors International of Washington (EXPD)
- •Payout Ratio: 25.3%
Expeditors is a global logistics company headquartered in Seattle, Washington. Expeditors’ services include the consolidation or forwarding of air and ocean freight, customs brokerage, vendor consolidation, cargo insurance, time definite transportation services, order management, warehousing and distribution, and customized logistics solutions. Currently, the company has over 250 locations and ~17,500 employees worldwide. In 2022, the company reported $17.1 billion in revenue.
On May 2nd, 2023, EXPD reported first-quarter results for Fiscal Year (FY)2023. Revenues saw a significant decrease of (44)%, from $4.7 billion in 1Q22 to $2.6 billion for 1Q23. The company saw a decline in average buy and sell rates in the first half of the year, which is typical as pandemic-related bottlenecks eased and supply and demand imbalances improved.
Click here to download our most recent Sure Analysis report on EXPD (preview of page 1 of 3 shown below):
Safest Dividend Aristocrats #9: Pentair plc (PNR)
- •Payout Ratio: 24.1%
Pentair is a pure-play water solutions company that operates in 3 segments: Aquatic Systems, Filtration Solutions, and Flow Technologies. Pentair was founded in 1966. Pentair has increased its dividend for more than four decades in a row, when adjusted for spin-offs.
Pentair is one of the top water stocks.
Pentair reported its fourth quarter earnings results on January 31. The company was able to generate revenues of $1.0 billion during the quarter, which was 1% more than the company’s revenues during the previous year’s quarter, a result that beat estimates slightly.
Core sales, which excludes the impact of currency rate movements, acquisitions, and dispossessions, were down 3% year over year, which was weaker than the core revenue growth rate during the previous quarter, during which Pentair reported a core sales increase.
Source: Investor Presentation
Pentair recorded earnings-per-share of $0.82 for the fourth quarter, which was down by 7% year over year. Pentair’s earnings-per-share beat the analyst consensus by $0.03. Pentair announced its guidance for the current year during the earnings report.
Click here to download our most recent Sure Analysis report on Pentair (preview of page 1 of 3 shown below):
Safest Dividend Aristocrats #8: Dover Corporation (DOV)
- •Payout Ratio: 22.6%
Dover Corporation is a diversified global industrial manufacturer with annual revenues of nearly $9 billion. Dover is composed of five reporting segments: Engineered Systems, Clean Energy & Fueling, Pumps & Process Solutions, Imaging & Identification, and Climate & Sustainability Technologies. Slightly more than half of revenues come from the U.S., with the remainder coming from international markets.
On April 26th, 2023, Dover reported first quarter results the period ending March 31st, 2023. For the quarter, revenue grew 1.5% to $2.08 billion, which was in-line with expectations. Adjusted earnings-per-share of $1.94 compared to $1.90 in the prior year and was $0.01 above estimates.
Click here to download our most recent Sure Analysis report on DOV (preview of page 1 of 3 shown below):
Safest Dividend Aristocrats #7: W.W. Grainger (GWW)
- •Payout Ratio: 21.0%
W.W. Grainger, headquartered in Lake Forest, IL, is one of the world’s largest business-to-business distributors of maintenance, repair, and operations (“MRO”) supplies.
On April 27nd, 2023, W.W. Grainger reported its Q1 results for the period ending March 31st, 2023. Revenues came in at $4.1 billion, up 12.2% on a reported and up 14.5% on a daily, constant currency basis (adjusted) compared to last year. Results were driven primarily by the High-Touch Solutions segment achieving adjusted sales growth of 14.5% due to both strong price realization and continued volume gains across all geographies.
Click here to download our most recent Sure Analysis report on GWW (preview of page 1 of 3 shown below):
Safest Dividend Aristocrats #6: Chubb Limited (CB)
- •Payout Ratio: 19.0%
Chubb Ltd is a global provider of insurance and reinsurance services headquartered in Zurich, Switzerland. The company provides insurance services including property & casualty insurance, accident & health insurance, life insurance, and reinsurance.
Click here to download our most recent Sure Analysis report on Chubb (preview of page 1 of 3 shown below):
Safest Dividend Aristocrats #5: Brown & Brown (BRO)
- •Payout Ratio: 18.8%
Brown & Brown Inc. is a leading insurance brokerage firm that provides risk management solutions to both individuals and businesses, with a focus on property & casualty insurance. Brown & Brown has a notably high level of insider ownership.
Brown & Brown posted first quarter earnings on April 24th, 2023, and results were ahead of expectations on both the top and bottom lines. Adjusted earnings-per-share came to 84 cents, which was three cents ahead of estimates. Revenue was up 23.8% year-over-year to $1.12 billion, and was $50 million better than expectations. Organic revenue was up 12.6%.
Click here to download our most recent Sure Analysis report on BRO (preview of page 1 of 3 shown below):
Safest Dividend Aristocrats #4: Roper Technologies (ROP)
- •Payout Ratio: 16.9%
Roper Technologies is a specialized industrial company that manufactures products such as medical and scientific imaging equipment, pumps, and material analysis equipment. Roper Technologies also develops software solutions for the healthcare, transportation, food, energy, and water industries. The company was founded in 1981, generates around $5.4 billion in annual revenues, and is based in Sarasota, Florida.
On April 27th, 2023, Roper reported its Q1 results for the period ending March 31st, 2023. On a continuing operations basis, quarterly revenues and adjusted EPS were $1.47 billion and $3.90, indicating a year-over-year increase of 15% and 19%, respectively. The company’s momentum during the quarter remained strong, with organic growth coming in at 8%. Organic growth was once again driven by broad-based strength across its portfolio of niche-leading businesses.
Click here to download our most recent Sure Analysis report on ROP (preview of page 1 of 3 shown below):
Safest Dividend Aristocrats #3: Nucor Corp. (NUE)
- •Payout Ratio: 15.4%
Nucor is the largest publicly traded US-based steel corporation. The steel industry is notoriously cyclical, which makes Nucor’s streak of 50 consecutive years of dividend increases even more remarkable.
On 04/20/23, Nucor reported First quarter results. Nucor Corporation reported net earnings of $1.14 billion, or $4.45 per diluted share, for Q1 2023. This is a decrease from the $1.26 billion, or $4.89 per diluted share, reported in Q4 2022, and from the $2.10 billion, or $7.67 per diluted share, reported in Q1 2022.
The decrease is due to the absence of tax credits and valuation allowance changes reported in Q4 2022 and a write-off of a leasehold interest in unproved oil and gas properties in the raw materials segment.
Click here to download our most recent Sure Analysis report on NUE (preview of page 1 of 3 shown below):
Safest Dividend Aristocrats #2: West Pharmaceutical Services (WST)
- •Payout Ratio: 10.0%
West Pharmaceutical Services manufactures packaging and components involved in the distribution and application of pharmaceuticals. The company’s products include Zenith Crystal, a medical glass alternative, and SmartDose, an automatic medication delivery system.
West Pharmaceutical Services reported its first quarter earnings results on April 27. The company reported that its revenues totaled $720 million, which represents a revenue decline of 1% compared to the prior year’s quarter. West Pharmaceutical Services’ revenues were higher than what the analyst community had expected, beating estimates by $20 million. Revenues were negatively impacted by a strengthening dollar. Adjusted for that, West Pharmaceutical Services’ organic revenues were up by 2% year over year.
Click here to download our most recent Sure Analysis report on WST (preview of page 1 of 3 shown below):
Safest Dividend Aristocrats #1: Albemarle Corp. (ALB)
- •Payout Ratio: 6.9%
Albemarle is the largest producer of lithium and second largest producer of bromine in the world. The two products account for nearly two-thirds of annual sales. Albemarle produces lithium from its salt brine deposits in the U.S. and Chile. The company has two joint ventures in Australia that also produce lithium.
Related: 2023 Lithium Stocks List
Source: Investor Presentation
On May 3rd, 2023, Albemarle announced first quarter results. For the quarter, revenue grew 128.3% to $2.58 billion, but this was $160 million less than expected. Adjusted earnings-per-share of $10.32 compared very favorably to $2.38 in the prior year and was $3.26 above estimates.
Click here to download our most recent Sure Analysis report on Albemarle (preview of page 1 of 3 shown below):
Final Thoughts
Investors looking for quality dividend growth stocks should start their search with the Dividend Aristocrats, a select group of 67 stocks in the S&P 500 Index with at least 25 consecutive years of dividend growth.
Income investors should also consider dividend safety before investing in dividend stocks.
Fortunately, investors do not have to sacrifice quality in the search for yield. These 10 Dividend Aristocrats have market-beating dividend yields. But they also have high-quality business models, durable competitive advantages, and strong dividend payouts that can withstand recessions.
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