2 Safe S&P 500 Dividend Stocks Boomers Can Buy and Hold Forever
One of these household-name S&P 500 stocks has raised its dividend every single year for seven decades, and both pay their checks from cash left over after covering every other business need. Here is what stands between them and an…
If you are at or near retirement, the dividend that matters most is the one that keeps arriving and keeps growing through recessions, lawsuits and bear markets. Chasing the biggest yield often means owning a business that strains to pay it, while durable companies whose free cash flow covers the check with room to spare can let their raises compound for decades. The two S&P 500 members below both qualify, and one of them has raised its payout for 70 consecutive years.
Johnson & Johnson
Through its Innovative Medicine and MedTech divisions, Johnson & Johnson (NYSE:JNJ | JNJ Price Prediction) makes prescription drugs and medical devices. That spread across cancer drugs, immunology, neuroscience, heart devices, surgical tools and contact lenses is the source of its durability: when one product loses patent protection, dozens of others carry the load. The company now has 29 products and platforms generating at least $1 billion in annual sales, and its chief executive said on the latest earnings call that J&J is on track to "exceed $100 billion in annual revenue for the first time in our company’s 140-year history."
Dividend Safety Check for J&J
Yield: At a recent price of $265.78, the $1.34 quarterly dividend ($5.36 annualized) works out to a forward yield of about 2.02%, with a trailing yield of 1.97%. That is modest current income, but it is income that rises every year.
Coverage: Management guides to $21 billion of free cash flow this year. Paying $5.36 a share across all outstanding shares costs roughly $12.9 billion a year, or about 61% of that free cash flow. Measured against the adjusted EPS guidance midpoint of $11.10, the payout ratio is about 48%. GAAP earnings look far worse: third-quarter diluted EPS was $0.09 versus $2.12 a year ago, after roughly $7 billion in charges tied to a proposed talc settlement and two pipeline deals. That explains the trailing P/E of 40 next to a forward P/E of 21. Dividends are paid from cash, and the quarter still produced more than $6 billion of free cash flow.
Balance sheet: J&J ended the third quarter with about $17 billion of cash and marketable securities against roughly $45 billion of debt, for net debt near $28 billion. Full-year net interest expense guidance is only $150 million to $200 million, and the company’s profile notes it is one of only two U.S.-based companies with a AAA credit rating.
Track record: In April the board lifted the quarterly dividend 3.1% from $1.30 to $1.34, marking the 64th consecutive year of increases, well past the 50-year bar for Dividend King status. The payment history backs it up: the quarterly rate stepped from $1.01 in 2020 to $1.06, $1.13, $1.19, $1.24 and $1.30 in the following years before reaching today’s $1.34. The next $1.34 payment goes out December 8 to holders of record on November 24.
Why J&J Can Anchor an Income Portfolio for Decades
The growth engine is accelerating. Oncology sales grew about 17% last quarter, Tremfya rose 68.2% and Rybrevant climbed 64%, more than offsetting biosimilar losses on older drugs. Management says it sees a path to double-digit growth by the end of the decade without assuming any acquisitions. Raising the payout sits inside the company’s stated priorities, with the CFO describing capital allocation "centered on prioritizing investments that support key commercial launches, accelerate future innovation, increase our annual dividend." With a beta of 0.206, the shares have also historically moved far less than the broader market, a useful quality for a retiree who depends on stable income.
What Would Break the J&J Case
Talc litigation is the threat to watch. The proposed $5.5 billion ovarian talc resolution depends on participation from at least 95% of claimants. If that threshold fails and the cases drag on with larger judgments, cash that would otherwise fund future raises gets diverted to litigation, and while a dividend this well covered can absorb a lot, a long, open-ended legal bill is the scenario that would slow the streak.
Procter & Gamble
Procter & Gamble (NYSE:PG) sells the things households replace every week no matter what the economy does: Tide, Pampers, Gillette, Charmin, Dawn, Crest, Pantene, Olay and SK-II, organized into five divisions. Demand is strengthening. In the first quarter of fiscal 2027, organic sales rose 4.0%, all 10 product categories grew, and core EPS of $2.00 beat the $1.89 consensus, the sixth consecutive quarter P&G exceeded expectations. The Thorne acquisition, which closed October 1, adds a health and wellness brand to the portfolio.
Dividend Safety Check for P&G
Yield: At $161.25, the $1.0885 quarterly dividend ($4.354 annualized) yields about 2.70% on a forward basis, with a trailing yield of 2.61%.
Coverage: P&G generated $15.835 billion of free cash flow in fiscal 2026, up 12.74%, on $19.556 billion of operating cash flow. Its plan to pay over $10 billion in dividends this fiscal year equals around 63% of that free cash flow. Against the core EPS guidance midpoint of $7.00, the payout ratio is about 62%. The latest quarter shows the same buffer: $4.401 billion of free cash flow against $2.6 billion of dividends paid.
Balance sheet: Cash and equivalents reached $15.365 billion at quarter end, up 37.54% from a year earlier, with $55.337 billion of shareholders’ equity. The company is confident enough in that position to plan a combined $15 billion return to shareholders this fiscal year. In management’s words: "We expect to pay over $10 billion in dividends and to repurchase approximately $5 billion of common stock."
Track record: P&G highlights its 70th consecutive year of dividend increases and 136th consecutive year of dividend payments since incorporating in 1890. Payments confirm the steady climb, from $0.7907 a quarter in early 2021 through $0.8698, $0.9133, $0.9407, $1.0065 and $1.0568 to today’s $1.0885. The next payment arrives November 16.
Why P&G Can Keep Funding Dividend Raises for Decades
Few businesses are this woven into daily life. P&G’s scale gives it a productivity machine that funds reinvestment and the dividend at the same time: it delivered $2.8 billion of productivity savings last fiscal year. Growth is broadening, with Greater China organic sales up 8% and Europe up 4%. A beta of 0.377 reflects how little the stock tends to swing with the market, and the valuation trades at a forward P/E of 21 after the shares gained 10.14% over the past month.
What Would Break the P&G Case
A extended margin squeeze. This fiscal year’s outlook absorbs about $1.4 billion in after-tax commodity costs, and combined input costs and below-the-line items amount to roughly $1.9 billion, or 79 cents per share. Core gross margin already fell 150bps year over year. Management warned, "We expect these headwinds to increase in the next few quarters." If consumers push back on price increases for years rather than quarters, earnings would stall and the annual raises would likely shrink toward token size.
Two Dividend Kings Built for the Long Haul
Both carry balance sheets that can absorb a bad year. Johnson & Johnson and P&G pay their dividends out of roughly 60% of free cash flow and have raised their payouts for 64 and 70 straight years. Each faces a real threat, litigation for J&J and cost inflation for P&G, and each has the cash to work through it, so for a retiree building an income stream meant to outlast market cycles, these two durable, growing payers offer long records worth studying closely.
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Lee Jackson has covered Wall Street analysts' equity and debt research and equity strategy daily for 24/7 Wall St. since 2012. His broad, diverse career, including a stint as creative services director at an NBC affiliate in Austin, Texas, gives him unique insight into the financial industry.
Lee Jackson's journey in the financial industry spans more than 30 years, including nearly two decades as an institutional equity salesperson at Bear Stearns, Lehman Brothers, and Morgan Stanley. His career spanned pivotal sell-side Wall Street events, from the dot-com rise and bubble to the Long-Term Capital Management debacle, 9/11, and the Great Recession of 2008. This reflects his resilience and adaptability amid market volatility.
Lee Jackson’s practical financial industry experience, gained through a career at some of the biggest banks and brokerage firms, is complemented by a lifetime of writing across various platforms. This unique combination allows him to shed light on the intricacies of Wall Street in a way only someone with deep insider experience and knowledge can. Moreover, his extensive network across Wall Street continues to provide direct access for him and 24/7 Wall St., a privilege few firms enjoy.
Since 2012, Jackson’s work for 24/7 Wall St. has been featured in Barron’s, Yahoo Finance, MarketWatch, Business Insider, TradingView, Real Money, The Street, Seeking Alpha, Benzinga, and other media outlets. He attended the prestigious Cranbrook Schools in Bloomfield Hills, Michigan, and has a degree in broadcasting from the Specs Howard School of Media Arts.
