Retirees Take Note: DGRO Yields 2.4%, Has Raised Its Dividend Every Single Year for Over a Decade

By Austin Smith Published Mar 8, 9:54AM EDT

Retirees Take Note: DGRO Yields 2.4%, Has Raised Its Dividend Every Single Year for Over a Decade — © 24/7 Wall St.

DGRO has raised its annual dividend every single year since inception, through a pandemic, a rate-hiking cycle, and multiple bouts of market panic. For retirees building an income portfolio, that consistency matters more than a flashy headline yield.

How DGRO Generates Its Income

The iShares Core Dividend Growth ETF holds more than 400 dividend-paying companies screened specifically for their ability to grow dividends over time. Income flows from the quarterly dividends paid by those underlying companies, which the fund collects and passes through to shareholders. With an expense ratio of just 8 basis points, almost all of that income reaches investors.

The portfolio leans heavily on sectors known for durable cash flows: Financials (18.6%), Healthcare (17.4%), Consumer Staples (13.4%), and Industrials (12.9%). The top holdings read like a dividend blue-chip roster: Exxon Mobil (3.6%), Johnson & Johnson (3.32%), Apple (2.64%), JPMorgan Chase (2.61%), and AbbVie (2.61%).

The Distribution Record Is the Real Story

DGRO’s quarterly payouts have grown steadily since the fund launched in June 2014. The trajectory is clear looking at Q4 distributions alone: $0.152 in 2016, $0.194 in 2017, $0.200 in 2018, $0.235 in 2019, $0.273 in 2020, $0.299 in 2021, $0.329 in 2022, $0.370 in 2023, $0.378 in 2024, and $0.447 in 2025. That is an unbroken decade of growth, including through 2020 when many individual companies were suspending dividends entirely.

The current yield sits at approximately 2.04% on a trailing basis. That is below the 10-year Treasury yield of 4.09%, which is worth acknowledging honestly. Retirees who need maximum current income will find Treasuries more competitive right now. DGRO’s value proposition is different: it offers income that grows over time, not just income today.

Total Return Puts the Yield in Perspective

Price appreciation has contributed meaningfully to total return. DGRO has gained 16.53% over the past year and 73.43% over five years. Since inception, the fund is up 279.25%. The past month has seen a pullback of -2.33%, but that is noise against the longer trend.

Verdict

DGRO’s dividend is about as safe as an equity income stream gets. Broad diversification across 400+ holdings, a decade of uninterrupted dividend growth, and a portfolio anchored in high-quality businesses make a distribution cut unlikely under normal market conditions. The yield will not replace a Treasury bond for pure income today, but for retirees who want income that keeps pace with inflation over a 10- to 20-year horizon, DGRO earns its place in a portfolio.

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About the Author Austin Smith, PhD, MD, CFA →

Austin Smith is a financial publisher with over two decades of experience as an investor, analyst, and advisor. He covers stocks, ETFs, Artificial intelligence and personal finance for 24/7 Wall St. Previously, he spent over a decade at The Motley Fool as a senior editor for Fool.com, portfolio advisor for Millionacres, and launched The Ascent to help reader take control of their personal finances.

His work has been featured on Fool.com, NPR, CNBC, USA Today, Yahoo Finance, MSN, AOL, Marketwatch, and many other publications. He is as an advisor to private companies, and co-hosts The AI Investor Podcast with Eric Bleeker.

When not looking for investment opportunities, he can be found skiing, running, or playing soccer with his children. Learn more about Austin's investment approach here.