Hey everyone, Hirokichi here.
Today I want to introduce five well-known U.S. stocks that are famous for their long streaks of consecutive dividend increases. In the U.S., there are quite a few companies that have raised their dividend every single year for decades, and more and more investors are steadily buying into these kinds of stocks with the goal of eventually covering part of their living expenses with dividend income alone — what’s often called a “dividend lifestyle.” All five stocks featured here are well-known household names, so I think this will be a useful starting point even if you’re new to U.S. stock investing.
■ What are “Dividend Kings” and “Dividend Aristocrats”? The basics of consecutive dividend growers
Among U.S. stocks, there’s a group called “Dividend Kings” — companies that have increased their dividend for 50+ consecutive years — and another called “Dividend Aristocrats,” which have done so for 25+ consecutive years. Raising dividends every year for that long, through recessions, the Lehman Shock, and the COVID pandemic, says a lot about how stable these businesses are and how committed they are to returning value to shareholders. I picked five representative names from this group below.
■ Top 5 U.S. High-Dividend Stocks
(1) Coca-Cola (KO): A “Dividend King” with 64 consecutive years of dividend increases. A global beverage giant whose strengths are brand power and stable cash flow. Dividend yield is around 2.70%.
(2) Johnson & Johnson (JNJ): A “Dividend King” with 61 consecutive years of increases. A healthcare heavyweight spanning pharmaceuticals and medical devices, with a business mix that tends to hold up well regardless of the economic cycle. Dividend yield is around 3.04%.
(3) Procter & Gamble (PG): A “Dividend King” with 67 consecutive years of increases. A leading name in consumer staples, with a large portfolio of detergent and household product brands. Dividend yield is around 2.90%.
(4) PepsiCo (PEP): A “Dividend King” with 54 consecutive years of increases. A food and beverage giant often compared to Coca-Cola, since it holds both snack and drink businesses. Dividend yield is around 3.80% — notably higher than the three stocks above.
(5) Realty Income (O): A “Dividend Aristocrat” with 31 consecutive years of increases. A REIT (real estate investment trust) that invests in commercial real estate, known as “The Monthly Dividend Company” for paying dividends every month rather than quarterly. Dividend yield is around 5.30%, the highest of the five.
■ Things to Watch Out for with High-Dividend Investing
(1) Watch out for currency risk. U.S. stocks are basically traded in U.S. dollars, so a stronger yen will shrink the yen value of both your assets and your dividend income. (2) Don’t concentrate on a single stock — spread across multiple names and sectors. Even the five stocks introduced here span consumer staples, healthcare, and real estate, which helps diversify risk. (3) Don’t look at dividend yield alone — also check the number of consecutive years of increases and the payout ratio (how much of profit is being paid out as dividends). What matters most is whether a company can keep raising its dividend steadily over the long run.
■ Wrap-Up: Consecutive Dividend Growers as a Foundation for a Long-Term Dividend Lifestyle
Coca-Cola, Johnson & Johnson, Procter & Gamble, PepsiCo, and Realty Income have all kept raising their dividends for decades, weathering multiple economic downturns along the way. Of course, past performance doesn’t guarantee future results, but I think building a portfolio around these kinds of stocks can be a solid foundation if you’re aiming for a long-term dividend lifestyle. Why not start by looking a little deeper into whichever one caught your eye?
* This article is for informational purposes only and does not recommend any specific investment. Please research individual stocks carefully and make investment decisions at your own responsibility.
Let’s keep at it, slow and steady. See you next time!
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