Sure Dividend

Updated on July 9th, 2025 by Felix Martinez

The Dividend Kings are a select group of 55 stocks that have increased their dividends for at least 50 consecutive years. We believe the Dividend Kings are among the highest-quality dividend growth stocks to buy and hold for the long term.

With this in mind, we created a full list of all 55 Dividend Kings. You can download the full list, along with important financial metrics such as dividend yields and price-to-earnings ratios, by clicking on the link below:

Click here to instantly download your free spreadsheet of all Dividend Kings now, along with important investing metrics.

We individually review all the Dividend Kings each year. The next in the series is Illinois Tool Works (ITW).

Illinois Tool Works has increased its dividend for 61 consecutive years, which is especially impressive since it operates in a highly cyclical sector (industrials). This article will discuss the major reasons for Illinois Tool Works’ long dividend history.

Business Overview

Illinois Tool Works has been in operation for over 100 years. It began in 1902 when a financier named Byron Smith placed an advertisement in The Economist. At the time, Smith was looking to invest in a “high-class business (manufacturing preferred) in or near Chicago.” A group of inventors approached Smith with an idea to improve gear grinding, and Illinois Tool Works was born.

Illinois Tool Works generates an annual revenue of nearly $16 billion. It is composed of seven segments: automotive, food equipment, test and measurement, welding, polymers and fluids, construction products, and specialty products.

These segments have performed well compared to their peers, enabling Illinois Tool Works to achieve industry-leading margins.

Illinois Tool Works’ portfolio is concentrated in product segments that hold above-average growth potential in their respective markets. The company’s overarching strategic growth plan is to refine its business model as needed continually. The company frequently utilizes bolt-on acquisitions to expand its reach.

Growth Prospects

Inflation and rising interest rates pose a challenge to the macroeconomic environment for global industrial manufacturers. However, Illinois Tool Works continues to generate steady growth beyond 2025.

Source: Investor Presentation

Competitive Advantages & Recession Performance

Illinois Tool Works has a significant competitive advantage. Its wide economic “moat” refers to its ability to keep competition at bay. It achieves this through a massive intellectual property portfolio, which comprises more than 17,000 granted and pending patents.

At the same time, Illinois Tool Works has a decentralized, entrepreneurial corporate culture. This also sets the company apart from the competition. Illinois Tool Works empowers its various businesses with significant flexibility to customize their own approaches to serving customers in the best way possible.

One potential downside of Illinois Tool Works’ business model is that it is vulnerable to recessions. As an industrial manufacturer, Illinois Tool Works is reliant on a healthy global economy for growth.

Earnings-per-share performance during the Great Recession is below:

• 2007 earnings-per-share of $3.36
• 2008 earnings-per-share of $3.05 (9% decline)
• 2009 earnings-per-share of $1.93 (37% decline)
• 2010 earnings-per-share of $3.03 (57% increase)

That said, the company remained highly profitable during the Great Recession. This allowed it to continue increasing its dividend each year during the recession, despite declining earnings. The company also recovered quickly. Earnings-per-share soared 57% in 2010. By 2011, earnings per share surpassed 2007 levels.

A similar pattern was observed in 2020, as the coronavirus pandemic led to an economic recession. Illinois Tool Works’ earnings per share declined in 2020, but the decline was manageable, and the company continued to raise its dividend.

Valuation & Expected Returns

Using the current share price of ~$257 and the midpoint for 2025 earnings guidance of $10.35 for the year, Illinois Tool Works trades for a price-to-earnings ratio of 24.8. Given the company’s cyclical nature, we feel a target price-to-earnings ratio of 22.3 is appropriate. This is roughly in line with the company’s 10-year historical average.

As a result, Illinois Tool Works could be overvalued. If the P/E multiple contracts from 24.8 to 22.3 over the next five years, it would reduce annual returns by 1.5% during this period.

Earnings growth and dividends will also drive future returns. We expect 9% annual earnings growth over the next five years. In addition, Illinois Tool Works stock has a current dividend yield of 2.3%.

The company has increased its dividend rapidly in the past decade.

Source: Investor Presentation

Putting it all together, Illinois Tool Works is expected to return 9.8% annually through 2030. As a result, we have a hold recommendation on Illinois Tool Works, though the company’s ability to raise dividends through multiple recessions is impressive.

Final Thoughts

Illinois Tool Works is a high-quality company with an even better dividend growth stock. Its strategic growth plan is working well, and shareholders have been rewarded with rising dividends for over 50 years.

The stock also has a decent 2.3% dividend yield, which could make it an appealing choice for long-term dividend growth investors. However, the current stock price’s overvaluation means that total returns are not high enough to warrant a buy recommendation from Sure Dividend.

Additional Reading

The following databases of stocks contain stocks with very long dividend or corporate histories, ripe for selection for dividend growth investors.

• The Dividend Aristocrats List: S&P 500 stocks with 25+ years of dividend increases.
• 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 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.
• The Best DRIP Stocks: The top 15 Dividend Aristocrats with no-fee dividend reinvestment plans.
• The High ROIC Stocks List: The top 10 stocks with high returns on invested capital.
• The High Beta Stocks List: The 100 stocks in the S&P 500 Index with the highest beta.
• The Low Beta Stocks List: The 100 stocks in the S&P 500 Index with the lowest beta.
• The Complete List of Russell 2000 Stocks
• The Complete List of NASDAQ-100 Stocks