Top 53 U.S. Dividend Kings: Analyzing the Royalty of Dividend-Paying Companies

In the U.S. stock market, Dividend Kings are companies that have consistently increased their dividends for over 50 years. This remarkable track record reflects their financial stability, growth potential, and commitment to rewarding shareholders. Despite market volatility, these Dividend Kings have provided stable income through decades of dividend growth, making them an attractive choice for long-term investors.

In this article, we’ll explore the 53 companies classified as Dividend Kings, analyze their recent five-year performance, and discuss their future prospects.

Top 53 U.S. Dividend Kings and Key Metrics

Key Company Analysis

1. American States Water Co. (AWR)

• Sector: Utilities
• Dividend Growth Period: 69 years
• Dividend Yield: 2.4%
• 5-Year Average Dividend Growth Rate: 8.5%

Dividend Performance Over the Last 5 Years:

Performance and Business Outlook (Q2 2024):

1. Highlights

• Continued Dividend Growth: The Q3 2024 cash dividend increased by 8.3%, marking 70 consecutive years of dividend growth. Long-term compounding growth potential is substantial.
• Expansion in Military Base Contracts: AWR subsidiary ASUS began operations at new military bases. A 50-year contract at Naval Air Station Patuxent River increased to a fixed price of $378M, with additional revenue expected from a 15-year contract at Joint Base Cape Cod.
• Water Rate Adjustments: Water rate changes agreed upon with the California Public Utilities Commission (CPUC) will take effect in 2025, with over $573M in approved infrastructure investments planned over the next three years.

2. Financial Performance

• EPS Decline: Earnings per share (EPS) for the water business declined by $0.24 to $0.67 due to rising supply costs and regulatory adjustments.
• Growth in Contract Services: The contract services segment, including military base operations, reported $0.19 per share in earnings, a $0.07 increase year-over-year.

3. Future Outlook

• Increased Infrastructure Investments: Annual investments of $170M to $200M are planned for 2024, aimed at improving and expanding water supply systems. These investments are expected to drive higher revenues in the coming years.
• Regulatory Changes and Risk Management: Regulatory changes in California could impact earnings. AWR is pursuing cost-reduction strategies to enhance efficiency and profitability.

4. Investor Insights

AWR demonstrates strong dividend growth and revenue stability through military base contracts. However, rising supply costs and regulatory risks could pose challenges. Long-term dividend reliability remains a key attraction, with cost control and efficient infrastructure investment critical to future success.

Source: Shareholder Presentation

2. Procter & Gamble Co. (PG)

• Sector: Consumer Defensive
• Dividend Growth Period: 68 years
• Dividend Yield: 2.4%
• 5-Year Average Dividend Growth Rate: 5.0%

Dividend Performance Over the Last 5 Years:

Performance and Business Outlook (Q2 2024):

P&G reported strong results for Q2 2024, prompting an upward revision to its guidance. Key highlights are detailed below.

1. Q2 2024 Highlights

• Revenue Growth: Net sales rose 3% year-over-year to $21.4B.
• Organic Sales Growth: Increased by 4%, driven by price adjustments despite variable transportation and operational costs.
• EPS Changes: Diluted EPS decreased 12% to $1.40, affected by Gillette's intangible asset write-down. Core EPS, however, grew by 16% to $1.84.
• Cash Flow and Dividend Payout: Operating cash flow was $5.1B, with $2.3B allocated to dividends and $1B to share buybacks.

2. Performance by Business Segment

• Beauty: Organic sales grew 1%, with haircare leading growth despite declines in SK-II sales.
• Grooming: Sales increased 9%, driven by premium product growth and price adjustments.
• Health Care: Organic sales rose 2%, led by strong performance in oral care.
• Fabric & Home Care: The segment grew 6%, fueled by innovative and premium products.
• Baby, Feminine & Family Care: Organic sales rose 3%, supported by price increases and favorable product mixes.

3. Guidance and Outlook

• Sales Guidance: Full-year revenue growth is projected at 2-4%, with organic sales expected to rise 4-5%.
• Core EPS Growth: Core EPS growth guidance has been revised upward to 8-9%, reflecting revenue increases and cost-saving initiatives.
• Currency and Raw Material Costs: Adverse currency impacts of $1B are anticipated, partially offset by $800M in raw material cost reductions.
• Dividends and Share Buybacks: P&G plans to distribute over $9B in dividends and repurchase $5-6B in shares during the 2024 fiscal year.

Source: Procter & Gamble Investor Relations

3. Johnson & Johnson (JNJ)

• Sector: Healthcare
• Dividend Growth Period: 62 years
• Dividend Yield: 3.4%
• 5-Year Average Dividend Growth Rate: 5.5%

Dividend Performance Over the Last 5 Years:

Performance and Business Outlook (Q2 2024):

1. Q2 2024 Highlights

• Net Sales: Increased 5% year-over-year to $27.4B.
• EPS Growth: Diluted EPS rose 8% to $2.10.
• Organic Sales Growth: Up 4%, driven by robust pharmaceutical performance.
• Dividend Payout and Buybacks: $2.5B was distributed as dividends, with $1B allocated for share buybacks.

2. Segment Performance

• Pharmaceuticals: Organic sales grew 7%, with strong sales of IMBRUVICA and STELARA.
• Medical Devices: Achieved 3% growth, led by orthopedics and cardiovascular devices.
• Consumer Health: Recorded 2% growth, with NEUTROGENA and AVEENO driving performance.

3. Guidance and Outlook

• Sales Guidance: Full-year revenue growth is expected at 3-4%, with organic growth projected at 4-5%.
• Core EPS Growth: Core EPS guidance has been raised to 9-10%, reflecting strong pharmaceutical results.
• Dividends and Buybacks: Over $10B in dividends and $6-7B in share buybacks are planned for 2024.

Source: Johnson & Johnson Q2 2024 Earnings Report

Why Invest in Dividend Kings?

Dividend Kings represent companies with extraordinary commitment to shareholder returns through decades of consistent dividend growth. Their ability to sustain payouts during economic cycles highlights their financial resilience. For investors, these companies offer:

• Stable Cash Flow: Even in volatile markets, dividend payments provide steady income.
• Proven Growth: A long history of dividend increases indicates reliable corporate performance.
• Attractive for Long-Term Investors: Combining stability and growth, Dividend Kings are ideal for those seeking financial freedom and stable returns.

Key Considerations for Investing in Dividend Kings

1. Diversification: Spread investments across sectors to minimize risk.
2. Growth Potential: Look for companies not only offering high yields but also demonstrating future growth capacity.
3. Consistency: Prioritize companies with a proven history of maintaining and growing dividends.

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