Dividend Aristocrats List: Top 25 Among Billionaires

Vardah Gill

Thu, Dec 7, 2023, 9:08 AM14 min read

In this article:

In this article, we will discuss top 25 dividend aristocrats among billionaires. You can skip our detailed analysis of dividend aristocrats and the performance of dividend growers in the past, and go directly to read Dividend Aristocrats List: Top 10 Among Billionaires.

Investing in dividend stocks offers a distinct opportunity for investors seeking consistent income. With market sentiments fluctuating, there's a growing recognition of the significance of having cash readily available. Dividend investments address this need by providing a source of regular income. However, dividend investing is not solely about immediate earnings, it also presents the potential for growth over time. Companies that consistently grow dividends often demonstrate financial strength and stability, reflecting their ability to generate profits consistently. For this reason, analysts advise investors to focus on dividend aristocrats, which are companies that have raised their payouts for 25 consecutive years or more. According to a report by Fortune, despite trailing its benchmark, the S&P 500 Dividend Aristocrat Index has outperformed almost every US active manager in the last decade. Rupert Watts, head of factors and dividend indices at S&P Dow Jones Indices, spoke with the global media organization about dividend growers. Here is what the analyst said:

“Raising your dividend for 25 plus years is no easy feat. These are high-quality companies.”

Throughout history, dividends have been a crucial component of investors' overall returns, particularly in times when market returns remained below ten percent for extended durations. In the long run, dividends have substantially contributed to the returns received by investors. Looking back over the last five decades, approximately 72% of the total return of the S&P 500 Index has been credited to reinvested dividends and the remarkable effect of compounding, according to a report by RBC Wealth Management. The report further mentioned that firms that consistently increase their dividends or begin paying dividends altogether have typically offered higher overall returns with lower volatility compared to companies that either kept their dividends steady or reduced them.

While dividend stocks might be trailing the overall market performance in 2023, it's essential to note that they have outperformed the broader market during specific periods throughout history, as reported by ProShares. With an upside-downside capture of 91% and 80%, the S&P 500 Dividend Aristocrat Index has proven its strength in both upward and downward market movements. Its resilience shines through notably during market downturns, evident from its standout performance in 2022 when it surpassed the broader S&P 500 by a substantial 12%. Remarkably, this index has outperformed the S&P 500 in eight out of the ten worst quarterly market downturns since 2005. The report further mentioned by steadily increasing their dividends, dividend aristocrats have shown higher yield-on-cost than companies with initially higher dividend yields, even though their starting yields might be lower.

The Procter & Gamble Company (NYSE:PG), Colgate-Palmolive Company (NYSE:CL), and PepsiCo, Inc. (NASDAQ:PEP) are some of the best dividend aristocrat stocks as these companies have earned this distinction due to their consistent track record of increasing dividends over extended periods. What sets them apart is not just their dividend prowess but also their robust financial foundations. In this article, we will further discuss the top dividend aristocrat stocks according to billionaires.

Dividend Aristocrats List: Top 25 Among Billionaires

Photo by Annie Spratt on Unsplash

Our Methodology:

For this article, we first scanned the database of billionaire-owned stocks maintained by Insider Monkey as of Q3 2023. From this database, we picked dividend aristocrats, which are the companies with at least 25 consecutive years of dividend growth. We also measured hedge fund sentiment around each stock from our database of 910 hedge funds at the end of Q3. The stocks are ranked in ascending order of the number of billionaire investors having stakes in them.