Since 1926, dividends have accounted for almost a third of the total return of the S&P 500, so regardless of whether the market is up, down, or flat, regular dividend payments from high-quality blue chip stocks provide investors with a much better chance for success. With inflation staying frustratingly strong and the potential for more stock market turbulence in the fourth quarter, looking at quality stocks that pay dependable quarterly dividends makes sense.
Often, when income investors look for defensive companies paying big dividends, they are drawn to the Dividend Aristocrats, and with good reason. The 68 companies that made the cut for the 2024 S&P 500 Dividend Aristocrats list have increased dividends (not just remained the same) for 25 years straight. But the requirements go even further, with the following attributes also mandatory for membership on the dividend aristocrats list:
- Companies must be worth at least $3 billion each quarterly rebalancing.
- Average daily volume of at least $5 million transactions for every trailing three-month period at every quarterly rebalancing date.
- Be a member of the S&P 500
We screened the 2024 Dividend Aristocrats and found seven companies that could be primed for a huge year and are among the highest-yielding in the group.
This top company could jump with an economic pick-up and pay a very rich 5.66% dividend. 3M Co. (NYSE: MMM) is a diversified technology company worldwide.
It operates through four segments:
- Safety and Industrial
- Transportation and Electronics
- Health Care
The Safety and Industrial segment offers:
- Industrial abrasives and finishing for metalworking applications
- Auto body repair solutions;
- Closure systems for personal hygiene products
- Masking and packaging materials
- Electrical products and materials for construction and maintenance
- Power distribution and electrical original equipment manufacturers;
- Structural adhesives and tapes
- Respiratory, hearing, eye, and fall protection solutions
- Natural and color-coated mineral granules for shingles
The 3M Transportation and Electronics segment provides Ceramic solutions;
- Attachment tapes
- Sound and temperature management for vehicles
- Premium large-format graphic films for advertising and fleet signage
- Light management films and electronics assembly solutions
- Packaging and interconnection solutions
- Reflective signage for highway and vehicle safety
Italy, the company’s Healthcare segment offers:
- Food safety indicator solutions
- Healthcare procedure coding and reimbursement software
- Skin, wound care, and infection prevention products and solutions
- Dentistry and orthodontic solutions
- Filtration and purification systems.
The Consumer segment provides:
- Consumer bandages
- Braces, supports, and respirators
- Home cleaning products
- Retail abrasives and paint accessories
- Car care DIY products;
- Picture hanging and consumer air quality solutions
- Stationery products.
It offers its products through e-commerce and traditional wholesalers, retailers, jobbers, distributors, and dealers.
This stock is one of the top pharmaceutical stock picks across Wall Street and pays a dependable 3.83% dividend. AbbVie Inc. (NYSE: ABBV) is a global, research-based biopharmaceutical company formed in 2013 following separation from Abbott Laboratories.
The company develops and markets drugs in areas such as:
- Renal disease
One of the biggest concerns with AbbVie is what might eventually happen with the anti-inflammatory therapy Humira, which has some of the most significant sales for a drug ever recorded.
The company was concerned, so in June of 2019, they announced they had agreed to pay $63 billion for rival drugmaker Allergan Plc, the latest merger in an industry where some of the biggest companies have been willing to pay a high price to resolve questions about their future growth.
AbbVie may be nearing the limits of how far it can boost Humira’s price as cheaper competitors come to market. This is a problem Allergan is already grappling with as more alternatives to Botox emerge.
This is a very off-the-radar idea, but it makes sense as they produce products that are always needed and in demand. Amcor PLC (NYSE: AMCR) manufactures and sells packaging products in Europe, North America, Latin America, Africa, and Asia Pacific regions.
The company operates through two segments:
- Rigid Packaging
The Flexibles segment provides flexible and film packaging products in:
- Food and beverage
- Medical and pharmaceutical
- Fresh produce
- Snack food
- Personal care
- Other industries
The Rigid Packaging segment offers rigid containers for a range of beverage and food products, including:
- Carbonated soft drinks
- Sports drinks
- Milk-based beverages
- Spirits and beer
- Personal care items
- Plastic caps for various applications
The company sells its products primarily through its direct sales force.
Federal Realty Investment Trust
While real estate has slowly come back, hard assets are good in inflationary times, and this stock pays a solid 4.35% dividend. Federal Realty Investment Trust (NYSE: FRT) is a recognized leader in the ownership, operation, and redevelopment of high-quality retail-based properties in major coastal markets from Washington, D.C., to Boston, San Francisco, and Los Angeles.
Federal Realty’s mission is to deliver long-term, sustainable growth through investing in densely populated, affluent communities where retail demand exceeds supply.
Its expertise includes creating urban, mixed-use neighborhoods like:
- Santana Row in San Jose, California
- Pike & Rose in North Bethesda, Maryland
- Assembly Row in Somerville, Massachusetts
Federal Realty’s 105 properties include approximately 3,300 tenants in 26 million square feet and over 3,100 residential units. Federal Realty has increased its quarterly dividends to its shareholders for 56 consecutive years, the longest record in the REIT industry.
This company is a mutual fund powerhouse that pays a safe and secure 4.53% dividend. Franklin Resources Inc. (NYSE: BEN) is among the most prominent global money managers.
The firm markets mutual funds and institutional separate accounts under:
- Mutual Series brands
At times, 50% of its sales are from outside the US, an advantage given a maturing US market.
Franklin Resources offers its products and services under the brands of:
- Franklin Mutual Series
- Franklin Bissett
- Fiduciary Trust, Darby
- Balanced Equity Management
- Edinburgh Partners
The 2023 bull market was a solid tailwind for the company, and while withdrawals from baby boomers may be a concern, the path forward looks solid.
This is another ideal stock for growth and income investors looking for a safer contrarian idea for 2024 that pays a whopping 5.38% dividend. Realty Income Corp. (NYSE: O) is an S&P 500 company that provides stockholders with dependable monthly income.
The company is structured as a REIT, and its monthly dividends are supported by the cash flow from over 13,250 real estate properties owned under long-term lease agreements with commercial tenants.
The company has declared 640 consecutive common stock monthly dividends throughout its 54-year operating history and increased the dividend 122 times since Realty Income’s public listing in 1994. It is a top real estate member of the S&P 500 Dividend Aristocrats index.
T. Rowe Price Group
This is another top mutual fund company with tremendous assets under management and pays a 4.61% dividend. T. Rowe Price Group Inc. (NASDAQ: TROW) is a publicly owned investment manager.
The firm provides services to:
- Institutional investors
- Retirement plans,
- Financial intermediaries and Institutions
It launches and manages equity and fixed-income mutual funds.
T. Rowe Price invests in public equity and fixed-income markets across the globe. It employs fundamental and quantitative analysis with a bottom-up approach.
The firm utilizes in-house and external research to make its investments. It employs socially responsible investing focusing on environmental, social, and governance issues.
It also invests in late-stage venture capital transactions and usually invests between $3 million and $5 million.
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