Sure Dividend

High-Quality Dividend Stocks, Long-Term Plan
Member's Area

Dividend Aristocrats In Focus: Dover Corporation

Updated on May 20th, 2024 by Bob Ciura

The Dividend Aristocrats consist of companies that have raised their dividends for at least 25 years in a row. Many of the companies have turned into huge multinational corporations over the decades, but not all of them.

You can see the full list of all 68 Dividend Aristocrats here.

We created a full list of all Dividend Aristocrats, along with important financial metrics like price-to-earnings ratios and dividend yields. You can download your copy of the Dividend Aristocrats list by clicking on the link below:


Disclaimer: Sure Dividend is not affiliated with S&P Global in any way. S&P Global owns and maintains The Dividend Aristocrats Index. The information in this article and downloadable spreadsheet is based on Sure Dividend’s own review, summary, and analysis of the S&P 500 Dividend Aristocrats ETF (NOBL) and other sources, and is meant to help individual investors better understand this ETF and the index upon which it is based. None of the information in this article or spreadsheet is official data from S&P Global. Consult S&P Global for official information.

Dover Corporation (DOV) has raised its dividend for 68 consecutive years, giving it one of the longest dividend growth streaks in the entire stock market.

The company has achieved such an exceptional dividend growth record thanks to its strong business model, resilience to recessions, and steady long-term growth.

There is room for continued dividend raises each year going forward, but on the other hand the stock appears to be overvalued right now.

Business Overview

Dover is a diversified global industrial manufacturer which provides equipment and components, consumable supplies, aftermarket parts, software and digital solutions to its customers.

It has annual revenues of nearly $9 billion, with just over half of its revenues generated in the U.S., and operates in five segments: Engineered Systems, Fueling Solutions, Pumps & Process Solutions, Imaging & Identification and Refrigeration & Food Equipment.

Pumps & Process Solutions is the best-performing segment in recent years.

On April 25th, 2024, Dover reported first quarter results. For the quarter, revenue grew 0.5% to $2.09 billion, which was $60 million more than expected. Adjusted earnings-per-share of $1.95 compared favorably to $1.94 in the prior year and was $0.07 ahead of estimates.

Organic revenue declined 1% year-over-year, but bookings grew by 3%. For the quarter, Engineered Products had organic growth of 9% due to continued strong demand for waste handling and aerospace and defense products.

Orders for vehicle service also improved. Clean Energy & Fueling increased 1% as clean energy, software systems, and above ground retail fueling equipment all performed well.

Dover provided updated guidance for 2024 as well, with the company now expecting adjusted earnings-per-share in a range of $9.00 to $9.15, up from $8.95 to $9.15 previously. Organic revenue growth is still projected to be in a range of 1% to 3%.

Growth Prospects

Dover has pursued growth by expanding its customer base and through bolt-on acquisitions. Dover has routinely executed a series of bolt-on acquisitions and occasional divestments to reshape its portfolio and maximize its long-term growth.

The management team is constantly focused on delivering the most value to shareholders through portfolio transformation, which has generally been successful.

Source: Investor Presentation

Today, the company is a highly diversified industrial company with an attractive growth profile. In addition, Dover is also likely to enhance its earnings per share via opportunistic share repurchases.

We see 8% long-term earnings-per-share growth in the years to come, driven primarily by revenue increases, with a boost from share repurchases reducing the float.

Competitive Advantages & Recession Performance

Dover is a manufacturer of industrial equipment. The company offers highly engineered products, which are critical to its customers. It is also uneconomical for its customers to switch to another supplier because the risk of lower performance is material.

Therefore, Dover essentially operates in niche markets, which offer a significant competitive advantage to the company. This competitive advantage helps explain Dover’s consistent long-term growth trajectory.

On the other hand, Dover is vulnerable to recessions due to its reliance on industrial customers. In the Great Recession, its earnings per share were as follows:

Dover got through the Great Recession with just one year of decline in its earnings per share, and the company almost fully recovered from the recession in 2010.

Given its sensitivity to economic cycles, it is impressive that Dover has grown its dividend for 68 consecutive years.

Source: Investor Presentation

Another reason is the conservative dividend policy of management, which targets a payout ratio of around 30%. This policy provides a wide margin of safety during rough economic periods.

Overall, Dover will certainly continue to raise its dividend for many more years thanks to its low payout ratio, its decent resilience to recessions, and its healthy balance sheet.

Valuation & Expected Returns

Dover is expected to generate earnings-per-share of $9.08 for 2024. That means the stock trades for just 20.4 times this year’s earnings, which is higher than our estimate of fair value at 17 times earnings.

That implies a ~3.6% annual headwind to total returns from valuation compression over the next five years.

Including 8% expected annual earnings-per-share growth, the 1.1% current dividend yield, and a 3.6% annualized compression of the price-to-earnings ratio, we expect Dover to offer 5.5% average annual return over the next five years.

This puts Dover stock into the territory of a hold rating.

Final Thoughts

Dover has an impressive dividend growth record, with 68 consecutive years of dividend raises. This is an impressive achievement, particularly given the dependence of the company on industrial customers, who tend to struggle during recessions.

Dover has consistently grown its earnings per share over the years, which has translated into annual dividend increases.

The company has ample room to keep growing via this strategy for many more years. The stock is slightly overpriced, meaning it earns a hold rating.

Additionally, the following Sure Dividend databases contain the most reliable dividend growers in our investment universe:

If you’re looking for stocks with unique dividend characteristics, consider the following Sure Dividend databases:

The major domestic stock market indices are another solid resource for finding investment ideas. Sure Dividend compiles the following stock market databases and updates them monthly:

Thanks for reading this article. Please send any feedback, corrections, or questions to