In brief:

  • The Dividend Aristocrats are companies of the S&P 500 that have paid steadily increasing dividends for at least 25 years have outperformed the broader market over time.
  • These 66 are large, US companies that have historically provided (slightly) better performance and (slightly) lower volatility than the S&P 500 as a whole.
  • In 2021, the Dividend Aristocrats gained 25.9%, versus 28.71% for the S&P 500 index.

In this article:

  • Changes to the Dividend Aristocrats Index
  • Downloadable excel of all 65 dividend aristocrats
  • Dividend Aristocrats Historical Performance
  • Constituents of the Dividend Aristocrats by sector
  • no-fee DRIP Dividend Aristocrats

 

The Dividend Aristocrats Index

 

The Dividend Aristocrats are a select group of currently 65 S&P 500 stocks with 25+ years of consecutive dividend increases. These 66 are large, US companies that have historically provided (slightly) better performance and (slightly) lower volatility than the S&P 500 as a whole. They are the ‘upper class’ dividend growth stocks and a great source for dividend growth investors.

S&P 500 applies the following criteria to construct the Dividend Aristocrats list:

  • must be members of the S&P 500
  • must have increased dividends every year for at least 25 consecutive years
  • Market Cap at least USD 3 billion
  • Liquidity at least USD 5 million (average daily value traded)
  • Diversification, at least 40 constituents and no sector allocation above 30%
2022 Changes to the Dividend Aristocrats Index

 

On February 1st, 2022 Brown & Brown (BRO) and Church & Dwight (CHD) were added to the Dividend Aristocrats Index. AT&T (T) was removed, leaving 66 Dividend Aristocrats. This means that the number of constituents will increase to 66.

hanges-dividend-aristocrats-2022-jan

Previous Changes to the Dividend Aristocrats Index

In February 2021, IBM (IBM), Nextra Energy (NEE), and West Pharmaceutical Services (WST) were added to the index as new members. Carrier Global Corp (CARR), Otis World Corp (OTIS), and Raytheon Technologies Corp (RTX) lost their status.

This meant that the number of constituents remained at 65.

Ross Stores (ROST), added in January announced it is suspending its dividend on May 21st, 2020, and has been removed from The Dividend Aristocrats Index prior to the market open on July 1st, bringing the total members down from 66 to 65 again.

On March 31st, 2020, United Technologies merged with Raytheon to Raytheon Technologies, changed its ticker to RTX, and spun off Carrier Global (CARR) and Otis Worldwide (OTIS) to bring the total Dividend Aristocrat to 66.

Early 2020, Amcor (AMCR), Atmos Energy (ATO), Realty Income (O), Essex Property Trust (ESS), Ross Stores (ROST), Albemarle (ALB), and Expeditors International (EXPD) were added to the Dividend Aristocrats Index which brought the total number of Dividend Aristocrats to 64 (from 57).

See also an overview of all changes since 2009

 

Download Dividend Aristocrats List (excel)

There are currently 66 Dividend Aristocrats. You can download an Excel spreadsheet of all 66 (with metrics) for FREE by joining our newsletter:

 

Instantly Get Your Free Dividend Aristocrats Spreadsheet
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The Dividend Aristocrats Excel spreadsheet contains the following fundamental and stock price performance metrics for each stock in the index.

Fundamental metrics:

  • Dividend & earnings per share
  • Dividend Yield
  • Price-to-earnings ratio
  • Pay-out ratio
  • Beta

Stock price performance metric (Members only):

  • 1 yr price target
  • 10 year weighted compound annual growth rate (WCAGR / GEOPAK10)
  • Win factor
  • Loss ratio
  • Total return

You can see a detailed analysis of all 66 Dividend Aristocrats on the page per stock as listed in the sections below. The analysis includes valuation, growth, and historical dividends, and more.

Performance Update December 2021

 

In December 2021, the Dividend Aristocrats gained 7.34% in December 2021 and outperformed the broader S&P 500 which jumped 4.48%.

in 2021 (full-year) the Dividend Aristocrats gained 25.99%, versus 28.71% for the S&P 500 index. The annualized returns over the past 10 years are 15.41% for the Dividend Aristocrats versus 16.55% for the S&P 500.

However, the Dividend Aristocrats have shown lower risk than the benchmark over the past 10 years, as measured by standard deviation and a higher indicated dividend yield (2.24%).

dividend-aristocrats-performance-historical-sept-2021

 

Dividend Aristocrats Performance 2021

 

The Dividend Aristocrats have historically shown smaller draw-downs during recessions versus the S&P 500. For example in 2008 the Dividend Aristocrats Index declined 21.9%, compared to the S&P 500 declined by 37%. In 2018 the Dividend Aristocrats (-2.73%) also outperformed the S&P500 (-4.38%) by 1.65%.

In 2020, the Dividend Aristocrats (+25.998.68%) underperformed the S&P 500 index (+28.71%) by -2.72%, which is significant.

The lower volatility could give some investors “peace of mind” but this comes also with a price. In the last 10 years, the dividend aristocrats are struggling to keep up with the total return. The average outperformance even dropped below zero and is now -0.32%. Also, this year’s lows and highs are not displaying the lower volatility, like the COVID-19 dip in March.

dividend-aristocrats-performance-chart-2020

The table below lists the yearly performance (total return) of the Dividend Aristocrats, the S&P 500, and the difference between the two.

dividend-aristocrats-yearly-table performance

Some additional data on the S&P 500 Dividend Aristocrats Index:

  • 10 Years annualized return: 15.41% (2020: 13.68%)
  • 10 years annualized risk: 12.67% (2020: 12.63%)
  • PE-ratio (trailing): 29.09
  • Dividend yield: 2.24% (2020: 2.59%)

The 10 years annualized return for the S&P 500 is 16%.

dividend-aristocrats-performance chart 2005-2021One good explanation for the current underperformance is the sector weighting of the Dividend Aristocrats. The dominating sectors are more defensive like Industrials (24.4%) and Consumer Staples (22.6%). The IT-sector represents only 1.7%, while in the S&P 500 index 27.6% is allocated to this sector.

Sector allocation aristocrats

Buy & Hold approach made easy

Dividend growth investing and a buy & hold approach go hand in hand. “Life is made easy” when investing in the Dividend Aristocrats Index, any holding period of 4 years or longer would have resulted in a positive performance. The diagram below shows the performance per holding period.

This performance/yield triangle shows the average annual returns for any investment period, ie combinations of buy and sell times on an annual basis. The “year of buy” is plotted on the horizontal axis and the “year of sell” on the vertical axis. The average annualized return can be seen at the intersection of these two coordinates.

dividend-aristocrats-yearly-triangleFor example, those who acquired the dividend aristocrats at the end of 2008 and sold them at the end of 2009 achieved an average annual return of 26.60%. With an exit in 2010, however, a per-annum return (CAGR) of 22.87% is calculated.

The average data in the bottom indicate which average annual yield was achieved at the start of the respective year. Starting with a position in the aristocrats at the end of 2008, Dividend Aristocrats (buy&hold) investors made e.g. average annual price returns of 18.34%.

Constituents of the Dividend Aristocrats by sector
You can see a detailed analysis of all 65 Dividend Aristocrats on the page per stock as listed in this section. The analysis includes valuation, growth, and historical dividends, and more. The information on the detailed pages is updated daily and members do have access to additional exclusive data analysis and charts

 

Energy

  • ExxonMobil (XOM)
  • Chevron (CVX)

Consumer Discretionary

  • Genuine Parts Company (GPC)
  • Lowe’s (LOW)
  • Target (TGT)
  • Walgreens Boots Alliance (WBA)
  • McDonald’s (MCD)
  • Leggett & Platt (LEG)
  • Wal-Mart (WMT)
  • V.F. Corp (VFC)

Consumer Staples

  • Archer Daniels Midland (ADM)
  • Amcor (AMCR)
  • Brown-Forman (BF.B)
  • Hormel Foods (HRL)
  • Kimberly-Clark (KMB)
  • McCormick & Company (MKC)
  • Sysco (SYY)
  • Procter & Gamble (PG)
  • Colgate-Palmolive (CL)
  • Clorox (CLX)
  • Coca-Cola (KO)
  • Pepsico (PEP)
  • Church & Dwight (CHD)

Industrials

  • 3M Company (MMM)
  • A.O. Smith (AOS)
  • Emerson Electric (EMR)
  • Dover (DOV)
  • Illinois Tool Works (ITW)
  • W.W. Grainger (GWW)
  • Pentair (PNR)
  • Roper Technologies (ROP)
  • Stanley Black & Decker (SWK)
  • Cintas (CTAS)
  • General Dynamics (GD)
  • Caterpillar (CAT)
  • Raytheon Technologies (RTX)
  • Expeditors International (EXPD)
  • Otis Worldwide (OTIS)
  • Carrier Global (CARR)

Financials

  • S&P Global Inc (formerly McGraw Hill Financial) (SPGI)
  • Aflac (AFL)
  • Franklin Resources (BEN)
  • T. Rowe Price (TROW)
  • Cincinnati Financial (CINF)
  • Chubb Limited (CB)
  • People’s United Financial (PBCT)
  • Brown & Brown (BRO)

Real Estate

  • Federal Realty Investment Trust (FRT)
  • Realty Income (O)
  • Essex Property Trust (ESS)

Healthcare

  • Becton, Dickinson and Company (BDX)
  • Cardinal Health (CAH)
  • Medtronic (MDT)
  • AbbVie (ABBV)
  • Abbott Laboratories (ABT)
  • Johnson & Johnson (JNJ)

Basic Materials

  • Air Products (APD)
  • PPG (PPG)
  • Sherwin-Williams (SHW)
  • Ecolab (ECL)
  • Nucor (NUE)
  • Linde (LIN)

Technology

  • Automatic Data Processing (ADP)

Telecommunication Services

  • AT&T (T)

Utilities

  • Consolidated Edison (ED)
  • Atmos Energy (ATO)
no-fee DRIP Dividend Aristocrats

 

A dividend reinvestment plan (DRIP) is a program that allows investors to reinvest their cash dividends into additional shares or fractional shares of the underlying stock on the dividend payment date. Dividend Aristocrats are perfect for DRIPs as a long-term investor. Below is the list of all 15 Dividend Aristocrats, that offer no-fee DRIPs to shareholders:

  • 3M Company (MMM)
  • A.O. Smith (AOS)
  • AbbVie Inc. (ABBV)
  • Aflac Incorporated (AFL)
  • Chubb Limited (CB)
  • Cincinnati Financial (CINF)
  • Emerson Electric (EMR)
  • Exxon Mobil (XOM)
  • Federal Realty Investment Trust (FRT)
  • Hormel Foods (HRL)
  • Johnson & Johnson (JNJ)
  • Nucor (NUE)
  • Realty Income (O)
  • S&P Global (SPGI)
  • Sherwin-Williams (SHW)

 

Other Sources of Dividend Investment Ideas

There are several lists to quickly screen for businesses that regularly pay rising dividends.

Next to selecting the right dividend stocks, important principles for successful long-term investing are Disciple, Diversification, Defensive & indeed Dividend. Read more about this in our free e-book.

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