- The Dividend Aristocrats gained 7.34% in December 2021 and outperformed the broader S&P 500 which jumped 4.48%.
- In total, the Dividend Aristocrats gained 25.99% in 2021, underperforming the S&P 500 index by 2.72%.
- The Dividend Aristocrats are a select group of currently 65 S&P 500 stocks with 25+ years of consecutive dividend increases.
- By showing the recent performance of the Dividend Aristocrats, some active dividend growth investors may be able to identify relative bargains.
The S&P 500 index (SPY) returned almost 29%, despite the ongoing pandemic, record inflation, and looming rate hikes. The Dividend Aristocrats (NOBL) were for the third year in a row not able to keep up with the S&P 500 index. However, in the long run, this dividend growth strategy is still showing a better performance.
The current 10-years annualized return is 15.41% for the Dividend Aristocrats (NOBL) versus 16.55% for the S&P 500.
The current dividend yield is 2.24% well above the 1.27% for the S&P 500 index.
Dividend Aristocrats performance in 2021
Gains for the Dividend Aristocrats were very good in the month of December with 60 constituents producing positive returns and only 5 constituents with negative returns.
The table below lists all 65 constituents, including the three 2021 dividend aristocrats IBM, NextEra Energy & West Pharmaceutical Services, sorted by indicated dividend yield, and lists price returns over trailing last month, and full-year 2021.
Here is what happened in December:
- Hormel Foods (HRL) returned 17.90% in December based on reporting strong Q4 double-digit sales growth in every segment.
- AbbVie (ABBV) closed the year up with a return of 17.45% in December.
- Laggards in December are Albemarle (ALB), Target (TGT), and Medtronic (MDT). Wells Fargo has downgraded MDT to Equal Weight from Overweight
- AT&T, Exxon Mobil, and IBM are still the top-3 highest dividend yield payers.
The above-presented performance and earnings data on the Dividend Aristocrats could assist active dividend growth investors to find some bargains for the long run.
Here is what happened in 2021:
- The Dividend Aristocrats gained 25.99% in 2021, while the S&P 500 index returned 28.71%.
- 57 Dividend Aristocrats delivered a positive price return while only 8 stocks were down for the full-year 2021.
- Leaders in 2021 were Nucor (NUE), West Pharmaceutical Services (WST), and Lowe (LOW).
- Laggards were especially AT&T (T) due to the dividend impact of the spinoff of Warner Media and its merger with Discovery. Also, Clorox (CLX), and VFC ended the year lower.
Other Sources of Dividend Investment Ideas
The Dividend Aristocrats list is not the only way to quickly screen for businesses that regularly pay rising dividends.
- The Dividend Kings List is even more exclusive than the Dividend Aristocrats. It is comprised of less than 20 businesses with 50+ years of consecutive dividend increases.
- The MoneyInvestExpert Defensive Aristocrats is a performance-based top-10 selection of the Dividend Aristocrats to outperform the market on the long-term.
- Portfolio lists like the Berkshire Hathaway Portfolio or Bill Gates’stock portfolio can be a source.
- For the European focused investors there is also the list of European Dividend Aristocrats.
- Dividend Champions are not necessarily members of the S&P 500 index, have increased their dividend for 25 or more consecutive years.
- 100+ years of dividend, the list of stocks that pay over 100 year of dividend can be an list of inspiration.
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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