- The Dividend Aristocrats are a select group of currently 63 S&P 500 stocks with 25+ years of consecutive dividend increases.
- These 63 are large, US companies that have historically provided (slightly) better performance and (slightly) lower volatility than the S&P 500 as a whole.
- By showing the recent performance of the Dividend Aristocrats, some active dividend growth investors may be able to identify relative bargains.
US equities continued their rally in July, the S&P 500 gained 5.6% and the Dividend Aristocrats followed closely with 5.13%. The investors struggled with weak macroeconomic data, concerns on the COVID-19 virus combined with Fed stimulus, and some strong earnings, especially from big techs.
Dividend aristocrats underperforming
Year-to-date the US Dividend Aristocrats are still down -5.04% underperforming the S&P 500, given the +2.38% for this benchmark.
The 10 years annualized total returns of the Dividend Aristocrats and the S&P 500 are almost alike with 13.61% for the aristocrats and 13.84% for the SPX.
Dividend Aristocrats performance in July 2020
The table below lists all 63 constituents, excluding the recently added spin-offs Carrier Global (CARR) and Otis Worldwide (OTIS), sorted by indicated dividend yield and lists returns over trailing last month, 3-, 6-, and 12-month periods.
Ross Stores (ROST) lost its dividend aristocrat status due to a dividend cut and has been removed from this list.
Key takeaways from July’s performance:
- 18 dividend aristocrats generated a negative return, while 14 generate a return of more than 10%
- ADP lost almost 11% this month, mainly after its earnings report on 07/29.
- The best performing sectors are Basic Materials and Utilities.
- Energy and Real Estate struggled this month.
The above-presented performance data of the Dividend Aristocrats could assist active dividend growth investors to find some bargains for the long run. Interested in the latest data and also dividend growth rates, check our dividend aristocrats dashboard.
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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