About
Estimating the expected 5 years future total returns are based on two main components for dividend growth stocks:
- Dividend yield
- Change in share price
The change in share price often comes from dividend growth which is mainly driven by earnings per share growth and the difference between the share price and the fair value. The expected price-to-earnings ratio over the next 5 years or the average dividend yield over the last 5 years is often used to estimate the change in the share price. The assumption made is that the share price will return over time to this average value.
To estimate the future total return the following values are added together:
- Estimated EPS growth next 5 years, as an indicator for the average dividend growth
- Average dividend yield, assuming
- Extra return due to over/undervaluation
The table below lists the top-10 Dividend Aristocrats with the highest estimated future total return for the next 5 years (CAGR), the EPS estimate for the next 5 years, and the extra positive or negative return due to over/undervaluation. The dividend score is also a factor that should be considered when evaluating those dividend stocks.
Name Ticker Valuation Dividend Score future return 5Y EPS next 5Y extra return 5Y avg div yield 5y Dividend Yield (%)
V.F. Corp.
VFC
May be undervalued
Current dividend yield is 170%
above its 5-year average77
45.78
21.46
21.94
2.37
6.40
Sysco Corp.
SYY
Looks reasonably valued
Current dividend yield is 8%
above its 5-year average70
32.18
28.37
1.60
2.21
2.39
Stanley Black & Decker
SWK
May be undervalued
Current dividend yield is 117%
above its 5-year average75
31.57
13.18
16.71
1.68
3.64
Franklin Resources
BEN
May be undervalued
Current dividend yield is 14%
above its 5-year average79
27.50
21.46
2.66
3.38
3.85
T. Rowe Price Group
TROW
May be undervalued
Current dividend yield is 43%
above its 5-year average87
24.89
14.69
7.44
2.76
3.95
Ecolab Inc.
ECL
May be undervalued
Current dividend yield is 35%
above its 5-year average73
23.44
16.24
6.21
0.99
1.34
Lowe's Cos.
LOW
May be undervalued
Current dividend yield is 12%
above its 5-year average79
23.07
19.14
2.37
1.55
1.75
NextEra Energy, Inc
NEE
May be undervalued
Current dividend yield is 89%
above its 5-year average
22.63
8.01
13.57
1.05
1.98
Medtronic plc
MDT
May be undervalued
Current dividend yield is 56%
above its 5-year average71
22.34
10.94
9.28
2.12
3.30
McDonald's Corp.
MCD
Looks reasonably valued
Current dividend yield is -7%
below its 5-year average74
21.30
20.43
-1.38
2.26
2.11
West Pharmaceutical Services, Inc
WST
Looks overvalued
Current dividend yield is -23%
below its 5-year average
21.16
25.80
-5.02
0.38
0.29
McCormick & Co.
MKC
May be undervalued
Current dividend yield is 84%
above its 5-year average76
20.52
6.50
13.02
1.00
1.84
3M Company
MMM
May be undervalued
Current dividend yield is 53%
above its 5-year average77
19.72
7.88
8.88
2.96
4.53
International Business Machines Corporation
IBM
Looks reasonably valued
Current dividend yield is -8%
below its 5-year average75
19.49
16.32
-1.66
4.84
4.45
Chubb Limited
CB
Looks overvalued
Current dividend yield is -26%
below its 5-year average65
19.06
22.85
-5.74
1.95
1.45
Walgreens Boots Alliance
WBA
May be undervalued
Current dividend yield is 61%
above its 5-year average68
18.37
5.14
10.05
3.18
5.13
Sherwin-Williams
SHW
May be undervalued
Current dividend yield is 28%
above its 5-year average85
17.33
11.50
5.06
0.77
0.98
Essex Property Trust, Inc
ESS
May be undervalued
Current dividend yield is 37%
above its 5-year average
17.22
7.90
6.44
2.88
3.93
Abbott Laboratories
ABT
May be undervalued
Current dividend yield is 15%
above its 5-year average84
17.09
12.84
2.76
1.49
1.71
Caterpillar Inc.
CAT
Looks overvalued
Current dividend yield is -22%
below its 5-year average61
16.60
19.06
-4.75
2.29
1.79
Illinois Tool Works
ITW
Looks reasonably valued
Current dividend yield is -1%
below its 5-year average80
16.09
14.13
-0.22
2.18
2.16
Cincinnati Financial
CINF
Looks reasonably valued
Current dividend yield is 1%
above its 5-year average79
15.45
12.77
0.17
2.51
2.53
Nucor Corp.
NUE
Looks overvalued
Current dividend yield is -50%
below its 5-year average68
15.40
25.67
-12.82
2.55
1.28
Pentair Ltd.
PNR
Looks reasonably valued
Current dividend yield is -5%
below its 5-year average60
15.39
14.70
-1.08
1.77
1.67
Leggett & Platt
LEG
May be undervalued
Current dividend yield is 34%
above its 5-year average68
14.87
5.20
6.08
3.58
4.81
PPG Industries
PPG
May be undervalued
Current dividend yield is 21%
above its 5-year average74
14.74
9.30
3.93
1.50
1.83
Becton Dickinson
BDX
Looks reasonably valued
Current dividend yield is 6%
above its 5-year average71
14.06
11.65
1.11
1.29
1.37
Albemarle Corporation
ALB
Looks overvalued
Current dividend yield is -50%
below its 5-year average
14.01
25.61
-12.90
1.29
0.65
Target Corp.
TGT
Looks reasonably valued
Current dividend yield is -2%
below its 5-year average67
13.57
11.45
-0.37
2.49
2.45
A.O. Smith
AOS
May be undervalued
Current dividend yield is 21%
above its 5-year average77
13.43
8.00
3.91
1.52
1.84
Air Products & Chemicals Inc
APD
Looks reasonably valued
Current dividend yield is -6%
below its 5-year average87
13.31
12.28
-1.16
2.19
2.07
Roper Technologies
ROP
Looks reasonably valued
Current dividend yield is 7%
above its 5-year average69
13.08
11.10
1.46
0.52
0.56
Linde plc
LIN
May be undervalued
Current dividend yield is 22%
above its 5-year average73
13.02
9.00
4.02
0.00
1.41
Cintas Corporation
CTAS
Looks reasonably valued
Current dividend yield is -6%
below its 5-year average78
12.69
12.85
-1.15
0.99
0.94
Federal Realty Investment Trust
FRT
Looks reasonably valued
Current dividend yield is 9%
above its 5-year average55
12.04
6.70
1.80
3.54
3.87
The Clorox Company
CLX
May be undervalued
Current dividend yield is 35%
above its 5-year average77
11.81
3.25
6.16
2.40
3.24
S&P Global, Inc.
SPGI
Looks reasonably valued
Current dividend yield is 1%
above its 5-year average80
11.65
10.50
0.26
0.89
0.90
Hormel Foods Corp.
HRL
May be undervalued
Current dividend yield is 12%
above its 5-year average80
11.21
7.00
2.22
1.99
2.22
Grainger (W.W.) Inc.
GWW
Looks overvalued
Current dividend yield is -27%
below its 5-year average66
11.10
15.48
-5.98
1.60
1.18
Colgate-Palmolive
CL
Looks reasonably valued
Current dividend yield is 4%
above its 5-year average77
10.99
7.89
0.80
2.30
2.40
Amcor plc
AMCR
Looks overvalued
Current dividend yield is -11%
below its 5-year average
10.81
8.66
-2.20
4.36
3.90
Atmos Energy Corporation
ATO
Looks reasonably valued
Current dividend yield is 7%
above its 5-year average
10.79
7.17
1.40
2.22
2.38
Coca-Cola Company (The)
KO
Looks reasonably valued
Current dividend yield is -7%
below its 5-year average66
10.73
9.05
-1.37
3.05
2.84
Realty Income Corp.
O
Looks reasonably valued
Current dividend yield is 5%
above its 5-year average80
10.62
5.45
1.02
4.16
4.37
PepsiCo Inc.
PEP
Looks reasonably valued
Current dividend yield is -8%
below its 5-year average73
10.36
9.20
-1.61
2.76
2.55
Johnson & Johnson
JNJ
Looks reasonably valued
Current dividend yield is 0%
below its 5-year average73
9.98
7.45
-0.01
2.53
2.53
Procter & Gamble
PG
Looks reasonably valued
Current dividend yield is -6%
below its 5-year average74
9.90
8.68
-1.33
2.55
2.39
Automatic Data Processing
ADP
Looks reasonably valued
Current dividend yield is -8%
below its 5-year average74
9.42
9.19
-1.71
1.94
1.78
Expeditors International of Washington, Inc
EXPD
Looks reasonably valued
Current dividend yield is 3%
above its 5-year average
8.43
6.60
0.66
1.17
1.21
Emerson Electric Company
EMR
Looks overvalued
Current dividend yield is -22%
below its 5-year average70
8.32
10.47
-4.81
2.66
2.08
AFLAC Inc
AFL
Looks reasonably valued
Current dividend yield is 0%
below its 5-year average77
8.24
6.11
-0.09
2.22
2.21
Brown-Forman Corp.
BFB
Looks reasonably valued
Current dividend yield is -9%
below its 5-year average71
7.72
8.40
-1.97
1.29
1.17
Dover Corp.
DOV
Looks overvalued
Current dividend yield is -21%
below its 5-year average64
7.49
10.26
-4.53
1.76
1.40
AbbVie Inc.
ABBV
Looks reasonably valued
Current dividend yield is -6%
below its 5-year average81
7.24
4.50
-1.18
3.92
3.70
Kimberly-Clark
KMB
Looks reasonably valued
Current dividend yield is 4%
above its 5-year average83
6.67
2.57
0.88
3.22
3.36
Wal-Mart Stores
WMT
Looks overvalued
Current dividend yield is -16%
below its 5-year average66
5.58
7.08
-3.32
1.82
1.54
Exxon Mobil Corp.
XOM
Looks overvalued
Current dividend yield is -44%
below its 5-year average73
4.79
10.14
-10.84
5.49
3.09
Consolidated Edison
ED
Looks overvalued
Current dividend yield is -12%
below its 5-year average66
4.10
2.95
-2.47
3.63
3.20
Cardinal Health Inc.
CAH
Looks overvalued
Current dividend yield is -34%
below its 5-year average67
2.64
6.83
-8.09
3.90
2.56
Genuine Parts
GPC
Looks overvalued
Current dividend yield is -26%
below its 5-year average70
1.61
4.60
-5.82
2.84
2.10
Archer-Daniels-Midland Co
ADM
Looks overvalued
Current dividend yield is -37%
below its 5-year average59
1.46
7.50
-8.95
2.91
1.82
General Dynamics
GD
Looks overvalued
Current dividend yield is -33%
below its 5-year average70
0.95
6.38
-7.70
2.27
1.52
Chevron Corp.
CVX
Looks overvalued
Current dividend yield is -28%
below its 5-year average78
-6.96
-4.90
-6.49
4.43
3.17
People's United Financial
PBCT
Looks overvalued
Current dividend yield is -100%
below its 5-year average73
-81.53
13.73
-100.00
4.74
0.00