The famous US Dividend Aristocrats are a select group of S&P 500 stocks with 25+ years of consecutive dividend increases. The UK Dividend Aristocrats Index is created by S&P and is based on a managed dividends policy of increasing or stable dividends for at least 10 consecutive years. In Europe, it is not common to focus on paying a dividend in a row ( consecutive years) to the shareholders.

Difference UK and US Dividend Aristocrats

The S&P 500 applies the following criteria to construct the US 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 not sector allocation above 30%

The UK Dividend Aristocrats are based (by S&P) on the 40 highest dividend-yielding UK companies within the S&P Europe Broad Market Index (BMI) and a managed dividends policy of increasing or stable dividends for at least 10 consecutive years.

Next to the currencies (GBP vs USD), the two major difference are:

  • Increasing or stable dividends for at least 10 consecutive years vs 25 consecutive years (US)
  • 40 highest dividend-yielding (UK), in the US the height of the yield is not a selection factor.

Due to COVID-19 and the above-mentioned criteria, the current number of UK dividend aristocrats is only 35.

Download UK Dividend Aristocrats List (excel)

 

The Dividend UK 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
  • Pay-out ratio

There is also a European Dividend Aristocrats list, which entails European stocks with 10+ consecutive years of dividend increases or stable dividends.

UK Dividend Aristocrats performance

In 2020 the UK Dividend Aristocrats index performance is at the moment of writing down almost 20% year-to-date. The annualized total return over 10 years is 6.08%. The indicated dividend yield is around 4.1% and the average projected PE is 14.85 for the stocks in this index.

UK-dividend-aristocrats-performance-2020

Sector overview of the Dividend Aristocrats

As explained the UK Dividend Aristocrats Index currently contains 35 stocks. As you can see below, the Financial sector accounts for 29.9% of the index.  Materials are on the other end of the spectrum at less than 2% of the European Dividend Aristocrats Index. To compare, the largest US dividend aristocrats sector is Consumer staples.

Sector dividend aristocrats UK

 

High Yield Dividend UK Stocks

The UK Dividend Aristocrats are based on the 40 highest dividend-yielding UK companies with increasing or stable dividends for at least 10 consecutive years. High yields are typically seen as a warning sign that dividends are unsustainable. For the UK stocks one should keep in mind that dividend yields on (all) UK shares are at their highest level, on average 4.8%, since 2009. So the UK Dividend Aristocrats list will consist of many stocks above this average.

Dividends continue to grow even while investors have concerns over the trade war, Brexit, and interest rates. Rising profitability, more special dividends, and a weaker pound helped UK dividends rise 5.1% in 2018 to a record GBP 99.8bn. Forecasts for 2019 are even higher and expecting the total dividends paid to GBP 104bn.

It will not be a surprise that the top-5 of the highest UK dividend aristocrats yields are well above 5% :

top-5-dividend-yield-uk-aristocrats

All 35 UK Dividend Aristocrats

Here are all 35 UK dividend aristocrats group by sector according to the criteria set by S&P.

Uk Dividend Aristocrats list

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.

Also, our monthly newsletter and premium member data will help you to invest smarter.

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