Updated on April 20th, 2023 by Bob Ciura
DRIP stands for Dividend Reinvestment Plan. When an investor is enrolled in DRIP stocks, it means that incoming dividend payments are used to purchase more shares of the issuing company – automatically.
Many businesses offer DRIPs that require the investors to pay fees. Obviously, paying fees is a negative for investors. As a general rule, investors are better off avoiding DRIP stocks that charge fees.
Fortunately, many companies offer no-fee DRIP stocks. These allow investors to use their hard-earned dividends to build even larger positions in their favorite high-quality, dividend-paying companies – for free.
Dividend Aristocrats are the perfect form of DRIP stocks. 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 68 Dividend Aristocrats (with additional financial metrics such as price-to-earnings ratios and dividend yields) by clicking the link below:
Think about the powerful combination of DRIPs and Dividend Aristocrats…
You are reinvesting dividends into a company that pays higher dividends every year. This means that every year you get more shares – and each share is paying you more dividend income than the previous year.
This makes a powerful (and cost-effective) compounding machine.
This article takes a look at the top 15 Dividend Aristocrats that are no-fee DRIP stocks, ranked in order of expected total returns from lowest to highest.
The updated list for 2023 includes our top 15 Dividend Aristocrats, ranked by expected returns according to the Sure Analysis Research Database, that offer no-fee DRIPs to shareholders.
You can skip to analysis of any individual Dividend Aristocrat below:
- #15: AbbVie Inc. (ABBV)
- #14: Abbott Laboratories (ABT)
- #13: Chubb Limited (CB)
- #12: Aflac Incorporated (AFL)
- #11: Illinois Tool Works (ITW)
- #10: Sherwin-Williams (SHW)
- #9: Hormel Foods (HRL)
- #8: A.O. Smith (AOS)
- #7: Emerson Electric (EMR)
- #6: Federal Realty Investment Trust (FRT)
- #5: S&P Global (SPGI)
- #4: Realty Income (O)
- #3: Johnson & Johnson (JNJ)
- #2: 3M Company (MMM)
- #1: Albemarle Corporation (ALB)
Additionally, please see the video below for more coverage.
No-Fee DRIP Dividend Aristocrat #15: AbbVie Inc. (ABBV)
- 5-year expected annual returns: 1.5%
AbbVie Inc. is a pharmaceutical company spun off by Abbott Laboratories (ABT) in 2013. Its most important product is Humira, which is now facing biosimilar competition in Europe, which has had a noticeable impact on the company. Humira will lose patent protection in the U.S. in 2023.
Even so, AbbVie remains a giant in the healthcare sector, with a large and diversified product portfolio.
Source: Investor Presentation
Click here to download our most recent Sure Analysis report on AbbVie (preview of page 1 of 3 shown below):
No-Fee DRIP Dividend Aristocrat #14: Abbott Laboratories (ABT)
- 5-year expected annual returns: 2.1%
Abbott Laboratories is one of the largest medical appliances & equipment manufacturers in the world, comprised of four segments: Nutrition, Diagnostics, Established Pharmaceuticals and Medical Devices.
On December 12th, 2022, Abbott Laboratories raised its quarterly dividend 7.8% to $0.51, extending the company’s
dividend growth streak to 51 years.
Source: Investor Presentation
Click here to download our most recent Sure Analysis report on Abbott Laboratories (preview of page 1 of 3 shown below):
No-Fee DRIP Dividend Aristocrat #13: Chubb Limited (CB)
- 5-year expected annual returns: 3.0%
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):
No-Fee DRIP Dividend Aristocrat #12: Aflac Inc. (AFL)
- 5-year expected annual returns: 3.3%
Aflac was formed in 1955, when three brothers — John, Paul, and Bill Amos — came up with the idea to sell insurance products that paid cash if a policyholder got sick or injured. In the mid-20th century, workplace injuries were common, with no insurance product at the time to cover this risk.
Related: Detailed analysis on the best insurance stocks.
Today, Aflac has a wide range of product offerings, some of which include accident, short-term disability, critical illness, hospital indemnity, dental, vision, and life insurance.
The company specializes in supplemental insurance, which pays out to policy holders if they are sick or injured, and cannot work. Aflac operates in the U.S. and Japan, with Japan accounting for approximately 70% of the company’s revenue. Because of this, investors are exposed to currency risk.
Click here to download our most recent Sure Analysis report on Aflac (preview of page 1 of 3 shown below):
No-Fee DRIP Dividend Aristocrat #11: Illinois Tool Works (ITW)
- 5-year expected annual returns: 4.6%
Illinois Tool Works is a diversified multi-industrial manufacturer with seven unique operating segments: Automotive, Food Equipment, Test & Measurement, Welding, Polymers & Fluids, Construction Products and Specialty Products.
On February 2nd, 2023, Illinois Tool Works reported fourth quarter and full year 2022 results for the period ending December 31st, 2022. For the quarter, revenue came in at $4.0 billion, up 8% year-over-year. Sales were up 20% in the Automotive OEM segment, the largest out of the company’s seven segments.
Click here to download our most recent Sure Analysis report on ITW (preview of page 1 of 3 shown below):
No-Fee DRIP Dividend Aristocrat #10: Sherwin-Williams (SHW)
- 5-year expected annual returns: 5.9%
Sherwin-Williams, founded in 1866, is North America’s largest manufacturer of paints and coatings.
The company distributes its products through wholesalers as well as retail stores (including a chain of more than 4,900 company-operated stores and facilities) to 120 countries under the Sherwin-Williams name.
The company also manufactures Dutch Boy, Pratt & Lambert, Minwax, Thompson’s Waterseal, Krylon, Valspar (acquired in 2017), and other brands.
Source: Investor Presentation
Click here to download our most recent Sure Analysis report on Sherwin-Williams (preview of page 1 of 3 shown below):
No-Fee DRIP Dividend Aristocrat #9: Hormel Foods (HRL)
- 5-year expected annual returns: 6.1%
Hormel Foods was founded back in 1891 in Minnesota. Since that time, the company has grown into a juggernaut in the food products industry with nearly $10 billion in annual revenue.
Hormel has kept with its core competency as a processor of meat products for well over a hundred years, but has also grown into other business lines through acquisitions.
Hormel has a large portfolio of category-leading brands. Just a few of its top brands include include Skippy, SPAM, Applegate, Justin’s, and more than 30 others.
Click here to download our most recent Sure Analysis report on Hormel (preview of page 1 of 3 shown below):
No-Fee DRIP Dividend Aristocrat #8: A.O. Smith (AOS)
- 5-year expected annual returns: 6.2%
A.O. Smith is a leading manufacturer of residential and commercial water heaters, boilers and water treatment products. A.O. Smith generates the majority of its sales in North America, with the remainder from the rest of the world.It has category-leading brands across its various geographic markets.
A.O. Smith is one of the top water stocks.
A.O. Smith reported its fourth quarter earnings results on January 31. The company generated revenues of $940 million during the quarter, which represents a decline of 6% compared to the prior year’s quarter.
A.O. Smith’s revenues were down slightly in North America, while revenues saw a larger decline in the rest of the world, with currency and COVID-related headwinds in China playing a role as well.
Source: Investor Presentation
Click here to download our most recent Sure Analysis report on A.O. Smith (preview of page 1 of 3 shown below):
No-Fee DRIP Dividend Aristocrat #7: Emerson Electric (EMR)
- 5-year expected annual returns: 7.6%
Emerson Electric is an ideal candidate for a no-fee DRIP program, as the company has increased its dividend for over 60 years in a row.
Emerson Electric was founded in Missouri in 1890 and since that time, it has evolved through organic growth, as well as strategic acquisitions and divestitures, from a regional manufacturer of electric motors and fans into a $49 billion diversified global leader in technology and engineering. Its global customer base and diverse product and service offerings afford it about $20 billion in annual revenue. The company has increased its dividend for 65 years in a row.
Click here to download our most recent Sure Analysis report on EMR (preview of page 1 of 3 shown below):
No-Fee DRIP Dividend Aristocrat #6: Federal Realty Investment Trust (FRT)
- 5-year expected annual returns: 7.8%
Federal Realty was founded in 1962. As a Real Estate Investment Trust, Federal Realty’s business model is to own and rent out real estate properties. It uses a significant portion of its rental income, as well as external financing, to acquire new properties. This helps create a “snow-ball” effect of rising income over time.
Federal Realty primarily owns shopping centers. However, it also operates in redevelopment of multi-purpose properties including retail, apartments, and condominiums. The portfolio is highly diversified in terms of tenant base.
Source: Investor Presentation
Click here to download our most recent Sure Analysis report on Federal Realty (preview of page 1 of 3 shown below):
No-Fee DRIP Dividend Aristocrat #5: S&P Global Inc. (SPGI)
- 5-year expected annual returns: 9.2%
S&P Global is a worldwide provider of financial services and business information. The company has generated strong growth over the past several years. It has increased its dividend for 50 consecutive years.
The most important feature of S&P Global is its strong competitive position. It operates in the highly concentrated
financial ratings industry where the three well-known rating agencies control over 90% of global financial debt ratings.
Click here to download our most recent Sure Analysis report on SPGI (preview of page 1 of 3 shown below):
No-Fee DRIP Dividend Aristocrat #4: Realty Income (O)
- 5-year expected annual returns: 10.6%
Realty Income is a retail-focused REIT that owns more than 6,500 properties. It owns retail properties that are not part of a wider retail development (such as a mall), but instead are standalone properties.
This means that the properties are viable for many different tenants, including government services, healthcare services, and entertainment.
Source: Investor Presentation
Click here to download our most recent Sure Analysis report on Realty Income (preview of page 1 of 3 shown below):
No-Fee DRIP Dividend Aristocrat #3: Johnson & Johnson (JNJ)
- 5-year expected annual returns: 10.7%
Johnson & Johnson is a diversified health care company and a leader in the area of pharmaceuticals (~49% of sales), medical devices (~34% of sales) and consumer products (~17% of sales). The company has annual sales in excess of $93 billion.
The company’s most recent earnings report was delivered on January 24th, 2023 for the fourth quarter and full year. For the fourth quarter, adjusted EPS of $2.35 beat by $0.11, while revenue of $23.7 billion missed slightly.
Full-year results can be seen in the image below:
Source: Investor Presentation
For 2023, the company expects 4% adjusted operational sales growth (excluding the COVID-19 vaccine) and 3.5% adjusted earnings-per-share growth.
Johnson & Johnson’s key competitive advantage is the size and scale of its business. The company is a worldwide leader in several healthcare categories. Johnson & Johnson’s diversification allows it to continue to grow even if one of the segments is underperforming.
The company has increased its dividend for 60 consecutive years, making it a Dividend King. The stock is owned by many well-known money managers. For example, J&J is a Kevin O’Leary dividend stock.
Click here to download our most recent Sure Analysis report on JNJ (preview of page 1 of 3 shown below):
No-Fee DRIP Dividend Aristocrat #2: 3M Company (MMM)
- 5-year expected annual returns: 15.9%
3M sells more than 60,000 products that are used every day in homes, hospitals, office buildings and schools around the world. It has about 95,000 employees and serves customers in more than 200 countries. 3M is now composed of four separate divisions.
3M is now composed of four separate divisions: Safety & Industrial, Healthcare, Transportation & Electronics, and Consumer. The company also announced that it would be spinning off its Health Care segment into a standalone entity, which would have had $8.6 billion of revenue in 2021. The transaction is expected to close by the end of 2023.
Source: Investor Presentation
On April 25th, 2023, 3M reported announced earnings results for the 2023 first quarter. For the quarter, revenue of $7.7 billion beat analyst estimates by $190 million. Adjusted EPS of $1.97 also beat estimates by $0.37.
Click here to download our most recent Sure Analysis report on 3M (preview of page 1 of 3 shown below):
No-Fee DRIP Dividend Aristocrat #1: Albemarle Corporation (ALB)
- 5-year expected annual returns: 27.5%
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.
The company has two joint ventures in Australia that also produce lithium. Albemarle’s Chile assets offer a very low-cost source of lithium.
Related: 2023 Lithium Stocks List
The company operates in nearly 100 countries and is composed of four segments: Lithium & Advanced Materials, Bromine Specialties, Catalysts and Other.
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 and Additional Resources
Enrolling in DRIP stocks can be a great way to compound your portfolio income over time.Additional resources are listed below for investors interested in further research for DRIP stocks.
For dividend growth investors interested in DRIP stocks, the 15 companies mentioned in this article are a great place to start. Each business is very shareholder friendly, as evidenced by their long dividend histories and their willingness to offer investors no-fee DRIP stocks.
At Sure Dividend, we often advocate for investing in companies with a high probability of increasing their dividends each and every year.
If that strategy appeals to you, it may be useful to browse through the following databases of dividend growth stocks:
- The High Yield Dividend Aristocrats List is comprised of the 20 Dividend Aristocrats with the highest current yields.
- The Dividend Achievers List is comprised of ~350 stocks with 10+ years of consecutive dividend increases.
- The Dividend Kings List is even more exclusive than the Dividend Aristocrats. It is comprised of 48 stocks with 50+ years of consecutive dividend increases.
- The High Yield Dividend Kings List is comprised of the 20 Dividend Kings with the highest current yields.
- The Blue Chip Stocks List: stocks that qualify as Dividend Achievers, Dividend Aristocrats, and/or Dividend Kings.
- The High Dividend Stocks List: stocks that appeal to investors interested in the highest yields of 5% or more.
- The Monthly Dividend Stocks List: stocks that pay dividends every month, for 12 dividend payments per year.
- The Dividend Champions List: stocks that have increased their dividends for 25+ consecutive years. Note: Not all Dividend Champions are Dividend Aristocrats because Dividend Aristocrats have additional requirements like being in The S&P 500.
- The Dividend Contenders List: 10-24 consecutive years of dividend increases.
- The Dividend Challengers List: 5-9 consecutive years of dividend increases.