Updated on April 5th, 2021 by Bob Ciura
Spreadsheet data updated daily
The Dividend Kings are the best-of-the-best in dividend longevity.
What is a Dividend King? A stock with 50 or more consecutive years of dividend increases.
The downloadable Dividend Kings Spreadsheet List below contains the following for each stock in the index, among other important investing metrics:
- Payout ratio
- Dividend yield
- Price-to-earnings ratio
You can see the full downloadable spreadsheet of all 31 Dividend Kings (along with important financial metrics such as dividend yields, payout ratios, and price-to-earnings ratios) by clicking on the link below:
There are currently 31 Dividend Kings, including recent additions such as Black Hills Corp. (BKH), Sysco (SYY), Universal Corporation (UVV) and National Fuel Gas (NFG). Each Dividend King satisfies the primary requirement to be a Dividend Aristocrat (25 years of consecutive dividend increases) twice over.
Editor’s Note: After review, Illinois Tool Works (ITW) and Target Corporation (TGT) have been removed from our lists, as they do not qualify as Dividend Kings. You can read more about this here.
Not all Dividend Kings are Dividend Aristocrats. This unexpected result is because the ‘only’ requirement to be a Dividend Kings is 50+ years of rising dividends, whereas Dividend Aristocrats must have 25+ years of rising dividends, be a member of the S&P 500 Index, and meet certain minimum size and liquidity requirements.
Table of Contents
- How To Use The Dividend Kings List To Find Dividend Stock Ideas
- The 5 Best Dividend Kings Today
#5: Black Hills Corporation (BKH)
#4: Johnson & Johnson (JNJ)
#3: ABM Industries (ABM)
#2: Altria Group (MO)
#1: Farmers & Merchants Bancorp (FMCB)
- Analysis Reports On All 31 Dividend Kings
- Performance Of The Dividend Kings
- Sector & Market Capitalization Overview
- Final Thoughts
How To Use The Dividend Kings List to Find Dividend Stock Ideas
The Dividend Kings list is a great place to find dividend stock ideas. However, not all the stocks in the Dividend Kings list make a great investment at any given time.
Some stocks might be overvalued. Conversely, some might be undervalued – making great long-term holdings for dividend growth investors.
For those unfamiliar with Microsoft Excel, the following walk-through shows how to filter the Dividend Kings list for the stocks with the most attractive valuation based on the price-to-earnings ratio.
Step 2: Follow the steps in the instructional video below. Note that we screen for price-to-earnings ratios of 15 or below in the video. You can choose any threshold that best defines ‘value’ for you.
Alternatively, following the instructions above and filtering for higher dividend yield Dividend Kings (yields of 2% or 3% or higher) will show stocks with 50+ years of rising dividends and above-average dividend yields.
Looking for businesses that have a long history of dividend increases isn’t a perfect way to identify stocks that will increase their dividends every year in the future, but there is considerable consistency in the Dividend Kings.
The 5 Best Dividend Kings Today
The following 5 stocks are our top-ranked Dividend Kings today, based on expected annual returns through 2026. Stocks are ranked in order of lowest to highest expected annual returns.
Total returns include a combination of future earnings-per-share growth, dividends, and any changes in the P/E multiple.
Dividend King #5: Black Hills Corp. (BKH)
- 5-Year Annual Expected Returns: 8.1%
Black Hills Corporation is an electric utility that provides electricity and natural gas to customers in Colorado, Iowa, Kansas, Montana, Nebraska, South Dakota, and Wyoming. Black Hills was founded in 1941, and the company is headquartered in Rapid City, South Dakota.
Source: Investor Presentation
Black Hills Corporation reported its fourth-quarter earnings results on February 9. The company generated revenues of $490 million during the quarter, up 2% year-over-year. Earnings-per-share of $1.23 for the fourth quarter, increased 8.9% year-over-year, showcasing the resilience of the company’s results during the pandemic.
Strong results were mostly due to higher natural gas demand for heating, which was again showcased by the above-average profitability during the fourth quarter. The company is forecasting earnings-per-share of $3.80 to $4.00 for the current fiscal year.
Overall, Black Hills Corporation’s dividend payout ratio declined between 2010 and 2019, due to a modest dividend growth rate. Today, the company pays out roughly 60% of its net profits in the form of dividends. Therefore, the dividend payout appears safe, even during a recession.
Shares trade for a 2021 P/E of 17.4, slightly below our fair value P/E of 18. In addition, expected annual EPS growth of ~4%, plus the 3.4% dividend yield lead to expected total annual returns of 8.1% per year over the next five years.
Dividend King #4: Johnson & Johnson (JNJ)
- 5-Year Annual Expected Returns: 8.2%
J&J is a global healthcare giant. It has a market capitalization above $400 billion, and generates annual revenue of more than $81 billion. Today, J&J manufactures and sells health care products through three main segments:
- Medical Devices
- Consumer Health Products
It has a diversified business model, with strong brands across its three core operating segments. A breakdown of each segment’s performance can be seen in the image below:
Source: Investor Presentation
On 1/26/2020, Johnson & Johnson announced fourth-quarter and full year earnings results. Revenue grew 8.3% to $22.5 billion, while adjusted earnings-per-share declined 1.1% to $1.86. For the year, revenue was higher by 0.6% to $82.6 billion while adjusted EPS fell 7.5% to $8.03.
In the fourth quarter, pharmaceutical sales were up 16.3% year-over-year. Consumer finished the year with 1.4% sales growth. The Medical Devices segment decreased 0.7%, but this is actually an improvement over prior quarters. The company expects revenue of $90.5 billion to $91.7 billion and adjusted EPS of $9.40 to $9.60 for 2021.
J&J has increased its dividend for 58 consecutive years, making it a Dividend King. The stock yields 2.5% right now. In addition, we expect approximately 6% annual earnings-per-share growth over the next five years. Lastly, the stock has a P/E of 17.1, nearly in-line with our fair value P/E estimate of 17. All together, we expect total returns of 8.2% per year for J&J stock.
Dividend King #3: ABM Industries (ABM)
- 5-Year Annual Expected Returns: 8.3%
ABM Industries has increased its dividend for 53 consecutive years. ABM Industries is a leading provider of facility solutions, which includes janitorial, electrical & lighting, energy solutions, facilities engineering, HVAC & mechanical, landscape & turf, and parking.
Source: Investor Presentation
ABM Industries reported its first-quarter earnings results (fiscal 2021) on March 9th. The company announced that its revenues totaled $1.49 billion during the quarter, which was above the analyst estimate, but which was still down by 8% versus the previous year’s quarter. The revenue decline was primarily caused by lower demand from ABM Industries’ customers during the coronavirus crisis, as some customers cut back on orders in order to preserve cash.
Earnings–per–share of $1.01 for the quarter increased 160% and exceeded the analyst consensus easily, by $0.42 per share. ABM Industries was able to lower its expenses by a lot more compared to the revenue decline it experienced during the quarter, which allowed for a steep increase in its profit margins. Thanks to the strong start to fiscal 2021, it is expected that ABM Industries will be highly profitable this year.
Due to the low dividend payout ratio and its very stable, recession–resilient business model, ABM Industries’ dividend looks very safe. We expect total annual returns just above 8% over the next five years, driven by 5% expected EPS growth, the 1.5% dividend yield, and a small boost from a rising P/E multiple.
Dividend King #2: Altria Group (MO)
- 5-Year Annual Expected Returns: 8.7%
Altria Group was founded by Philip Morris in 1847. Today, it is a consumer staples giant. It sells the Marlboro cigarette brand in the U.S. and a number of other non-smokeable brands, including Skoal, Copenhagen, and the Ste. Michelle brand of wine. Altria also has a 10% ownership stake in global beer giant Anheuser Busch InBev (BUD).
On January 28th, Altria reported financial results for the fourth quarter and full year. Revenue (net of excise taxes) of $5.05 billion increased 5.3% year-over-year. Cigarette volumes surprisingly increased 3.1% for the quarter, reversing many quarters of volume declines. Adjusted earnings-per-share declined 2% for the fourth quarter.
For the full year, revenue net of excise taxes increased 5.3% to $20.84 billion, while adjusted earnings-per-share increased 3.6% to $4.36 for 2020. For 2021, Altria expects adjusted diluted EPS in a range of $4.49 to $4.62, representing a growth rate of 3% to 6% from 2020.
The long-term future is cloudy for cigarette manufacturers such as Altria, which is why the company has invested heavily in adjacent categories to fuel its future growth. The company purchased a 55% equity stake in Canadian marijuana producer Cronos Group, invested nearly $13 billion for a 35% equity stake in e-vapor manufacturer Juul Labs, and recently acquired an 80% ownership stake in Switzerland-based Burger Söhne Group, for its on! oral nicotine pouch brand.
It has also invested in its own heated tobacco product line called IQOS and Marlboro HeatSticks, which the company continued to expand in 2020.
Source: Investor Presentation
We expect new products to fuel the company’s long-term growth. We forecast 3% annual EPS growth going forward, driven by revenue growth as well as share repurchases. Along with fourth-quarter financial results, Altria also announced a new $2 billion share repurchase authorization.
In the meantime, Altria’s dividend payout appears secure, as Altria generates huge cash flow, even during recessions. The company has increased its dividend for 51 consecutive years. Altria ranks very highly in terms of safety because the company has tremendous competitive advantages.
It operates in a highly regulated industry, which virtually eliminates the threat of new competition in the tobacco industry. Altria enjoys strong brands across its product portfolio, including the No. 1 cigarette brand. As a result, it has pricing power and brand loyalty. In addition, tobacco companies enjoy low manufacturing and distribution costs, thanks to economies of scale.
Based on the midpoint of 2021 adjusted EPS guidance, Altria stock trades for a P/E ratio of 11.2, slightly above our fair value estimate of 11. Including ~2.4% annual EPS growth and the 6.7% dividend yield, total returns are expected at 8.7% per year over the next five years.
Dividend King #1: Farmers & Merchants Bancorp (FMCB)
- 5-Year Annual Expected Returns: 10.2%
Founded in 1916, Farmers & Merchants Bancorp is a locally owned and operated community bank with 32 locations in California. Due to its small market cap (~$600 million) and its low liquidity, it passes under the radar of most investors. Nevertheless, F&M Bank has paid uninterrupted dividends for 86 consecutive years and has raised its dividend for 56 consecutive years.
The company is conservatively managed and, until four years ago, had not made an acquisition since 1985. However, in the last four years, it has begun to pursue growth more aggressively. It acquired Delta National Bancorp in 2016 and increased its locations by 4. Moreover, in October-2018, it completed its acquisition of Bank of Rio Vista, which has helped F&M Bank to further expand in the San Francisco East Bay Area.
In early February, F&M Bank reported (2/4/21) financial results for 2020. Despite the pandemic and the suppressed interest rates, the bank grew its earnings-per-share 4.8% over the prior year, and thus achieved record earnings-per-share of $74.03 for the full year. Net interest income grew 6.2% in 2020, thanks to 16.1% growth in loans, while deposits grew 24%.
Unlike most banks, which recorded significant loan loss provisions due to the pandemic, F&M Bank has booked provisions for loan losses equal to only 1.9% of its total portfolio. It was also able to enhance its net interest margin from 3.80% in the third quarter to 3.86% in the fourth quarter. Despite the impact of the pandemic on the economy, management is optimistic for this year thanks to the sustained business momentum.
Shares trade for a P/E ratio of ~10, compared with our fair value estimate of 12. An expanding valuation multiple could increase annual returns modestly each year. Combined with 5% expected EPS growth and the 1.9% dividend yield, total returns are expected to reach 10.2% per year over the next five years.
Analysis Reports On All 31 Dividend Kings
All 31 Dividend Kings are listed below by sector. You can access detailed coverage of each by clicking on the name of each Dividend King. Additionally, you can download our newest Sure Analysis Research Database report for each Dividend King as well.
- Genuine Parts Company (GPC) – [3/5/21 Sure Analysis report]
- Lowe’s Companies (LOW) – [2/24/21 Sure Analysis report]
- The Colgate-Palmolive Company (CL) – [2/6/21 Sure Analysis report]
- Hormel Foods Corporation (HRL) – [2/18/21 Sure Analysis report]
- The Coca-Cola Company (KO) – [2/17/21 Sure Analysis report]
- Lancaster Colony (LANC) – [2/11/21 Sure Analysis report]
- Altria Group (MO) – [2/10/21 Sure Analysis report]
- Procter & Gamble (PG) – [1/20/21 Sure Analysis report]
- Sysco Corporation (SYY) – [2/4/21 Sure Analysis report]
- Tootsie Roll Industries (TR) – [2/22/21 Sure Analysis report]
- Universal Corporation (UVV) – [2/11/21 Sure Analysis report]
- Cincinnati Financial (CINF) – [2/14/21 Sure Analysis report]
- Farmers & Merchants Bancorp (FMCB) – [2/8/21 Sure Analysis report]
- Commerce Bancshares (CBSH) – [1/26/21 Sure Analysis report]
- ABM Industries (ABM) – [3/17/21 Sure Analysis report]
- Dover Corporation (DOV) – [2/1/21 Sure Analysis report]
- Emerson Electric (EMR) – [2/6/21 Sure Analysis report]
- 3M Company (MMM) – [1/26/21 Sure Analysis report]
- Nordson (NDSN) – [2/25/21 Sure Analysis report]
- Parker Hannifin (PH) – [2/10/21 Sure Analysis report]
- Stanley Black & Decker (SWK) – [2/1/21 Sure Analysis report]
- American States Water (AWR) – [3/8/21 Sure Analysis report]
- Black Hills Corp. (BKH) – [2/13/21 Sure Analysis report]
- California Water Service (CWT) – [3/10/21 Sure Analysis report]
- Northwest Natural Gas (NWN) – [3/1/21 Sure Analysis report]
- SJW Group (SJW) – [2/20/21 Sure Analysis report]
Additionally, you can see the Dividend Kings analyzed in the video below.
Performance Of The Dividend Kings
The Dividend Kings outperformed versus the S&P 500 ETF (SPY) in March 2021. Return data for the month is shown below:
- Dividend Kings March 2021 total return: 6.8%
- SPY March 2021 total return: 4.5%
Stable dividend growers like the Dividend Kings tend to under-perform in bull markets, and outperform on a relative basis during bear markets.
The Dividend Kings are not officially regulated and monitored by any one company. There’s no Dividend King ETF. This means that tracking the historical performance of the Dividend Kings can be difficult. More specifically, performance tracking of the Dividend Kings often introduces significant survivorship bias.
Survivorship bias occurs when one looks at only the companies that ‘survived’ the time period in question. In the case of Dividend Kings, this means that the performance study does not include ex-Kings that reduced their dividend, were acquired, etc.
But with that said, there is something to be gained from investigating the historical performance of the Dividend Kings. Specifically, the performance of the Dividend Kings shows that ‘boring’ established blue-chip stocks that increase their dividend year-after-year can significantly outperform over long periods of time.
Notes: S&P 500 performance is measured using the S&P 500 ETF (SPY). The Dividend Kings performance is calculated using an equal weighted portfolio of today’s Dividend Kings, rebalanced annually. Due to insufficient data, Farmers & Merchants Bancorp (FMCB) returns are from 2000 onward. Performance excludes previous Dividend Kings that ended their streak of dividend increases which creates notable lookback/survivorship bias. The data for this study is from Ycharts.
Sector & Market Capitalization Overview
The sector and market capitalization characteristics of the Dividend Kings are very different from the characteristics of the broader stock market. The following bullet points show the number of Dividend Kings in each sector of the stock market.
- Industrial: 7
- Consumer Defensive: 9
- Utilities: 5
- Consumer Cyclical: 2
- Financial Services: 3
- Basic Materials: 2
- Real Estate: 1
- Healthcare: 1
- Energy: 1
The Dividend Kings are overweight in the Industrials, Consumer Defensive, and Utilities sectors. Interestingly, The Dividend Kings have no exposure to the Technology sector, which is the largest component of the S&P 500 index.
The Dividend Kings also have some interesting characteristics with respect to market capitalization. These trends are illustrated below.
- 3 Mega caps ($200 billion+ market cap; JNJ, PG, and KO)
- 13 Large caps ($10 billion to $200 billion market cap)
- 11 Midcaps ($2 billion to $10 billion)
- 4 Small caps ($300 million to $2 billion)
Interestingly, 19 out of the 31 Dividend Kings have market capitalizations below $20 billion. This shows that corporate longevity doesn’t have to be accompanied by massive size.
Screening to find the best Dividend Kings is not the only way to find high quality dividend growth stock ideas.
Sure Dividend maintains similar databases on the following useful universes of stocks:
- The Dividend Aristocrats: S&P 500 stocks with 25+ years of consecutive dividend increases.
- The Dividend Champions: stocks with 25+ years of dividend increases, including stocks that may not otherwise qualify as Dividend Aristocrats.
- The Dividend Contenders: 10-24 consecutive years of dividend increases.
- The Dividend Challengers: 5-9 consecutive years of dividend increases.
- The Dividend Achievers: dividend stocks with 10+ years of consecutive dividend increases.
- The Complete List of High Dividend Stocks: Stocks with 5%+ dividend yields.
- The Complete List of Monthly Dividend Stocks: our database currently contains more than 30 stocks that pay dividends every month.
- The Sure Dividend Blue Chip Stocks List: our list of “blue chip stocks” is a combination of our Dividend Kings, Dividend Aristocrats, and Dividend Achievers lists.
There is nothing magical about investing in the Dividend Kings. They are simply a group of high-quality businesses with shareholder-friendly management teams that have strong competitive advantages.
Purchasing businesses with these characteristics at fair or better prices and holding them for long periods of time will likely result in strong long-term investment performance.
The most appealing part of investing is that you have unlimited choice. You can buy into mediocre businesses, or just the excellent companies. As Warren Buffett says:
“When we own portions of outstanding businesses with outstanding managements, our favorite holding period is forever.”
– Warren Buffett