Dividend Kings are often overlooked when building a solid investment portfolio. However, they can be a valuable addition. These companies have consistently paid and increased dividends for at least 50 years. It's a (pretty solid) indicator of the business’s financial stability and grit, even in challenging economic times.
Although investors like myself understand that no investment is without risk, investing in Dividend Kings can benefit investors by providing a reliable income stream, lower volatility compared to the broader market, and the power of compounding returns over the long term.
How I Screened For The Following Dividend Kings
For this analysis, I made use of Barchart’s Free Stock Screener tool to find Dividend Kings with an "Overall Opinion" of over 80%. To create the screen, I added the following filters:
- Annual Dividend Yield: Left Empty (to sort later),
- Overall Opinion (buy): Greater than 80%
For starters, the Annual Dividend Yield is the annual dividend expressed as a % that the company pays its stockholders. We get the yield by totaling the last 12 months of dividends and dividing it by the current stock price. The result is the annual dividend yield.
On the other hand, the Overall Opinion is unique to Barchart and is based on the proprietary Barchart Opinion system. It runs a particular stock through 13 analytical techniques while looking at short-, medium-, and long-term periods. Then, it translates the results into buy, sell, or hold signals.
After setting the Barchart filters, I was left with 17 Dividend Kings to choose from, and clicked “Div Yield(a)” to get my list:
You might have noticed that 3M is at the top of the list; however, 3M recently announced it will cut its dividend, meaning it will no longer be a Dividend King.
National Fuel Gas Company (NFG)
National Fuel Gas Company is an energy holding company that operates across the natural gas value chain. Its operations are divided into four main segments—exploration and production, pipeline and storage, gathering, and utility.
The company’s Q2’24 financials show it’s doing well with its YOY growth in key areas: operating income increased from $141.8 million to $165.3 million, while net income rose by 18% YOY, boosting EPS to $1.79.
Feeling good about these numbers, the company has increased its fiscal 2024 EPS guidance from $4.75 to $5.05.
Investors might like the sound of National Fuel Gas Company's dividend yield of 3.50% ($1.98 per share, per year.) Plus, it’s been paying dividends for 121 years straight and increasing them for 53 years in a row, which I think, is pretty impressive.
Meanwhile, the overall opinion is giving NFG stock a thumbs up with a buy signal of 88%, suggesting that the company's financial potential for making shareholders happy looks promising.
Black Hills Corp (BKH)
Another Dividend King on our Radar is Black Hills Corporation. It’s a growth-oriented utility company focusing on eight states: Arkansas, Colorado, Iowa, Kansas, Montana, Nebraska, South Dakota, and Wyoming. The company operates through two main segments: Electric Utilities, which generate, transmit, and distribute electricity, and Gas Utilities, which serve natural gas.
2023 was kind to Black Hills Corps, with its Q4'23 report pointing to operating income rising $130 million to $136.5 million from the same quarter last year and its net income rising from $76.1 million to $83.2 million - driving EPS to $1.17 from $1.11.
Looking at the future, the company is initiating a 2024 EPS guidance range of $3.80 to $4.00 and raising its 5-year capital forecast by $800 million to $4.3 billion for 2024-2028.
BKH stock offers a $2.60 annual dividend, translating to a 4.51% yield. The company has consistently paid dividends for 82 years and increased them for 54 years straight.
The overall opinion gives BKH stock a buy signal of 100%, which is a very strong indicator of confidence in the company's future.
Altria Group (MO)
The last buy-rated Dividend King on the list, Altria Group, is a big shot in the U.S. tobacco world, with numerous companies under its umbrella. The company has something for every tobacco user, but strictly over 21 years old—from cigarettes and cigars to smokeless tobacco and nicotine pouches. Many people have certainly encountered some of their famous brands, like Marlboro, Copenhagen, and so on.
As part of a broader $3.4 billion buyback plan, Altria is accelerating its share repurchase program, buying back $2.4 billion of its stock. The company also participated in a global offering, selling 35 million shares of Anheuser-Busch InBev or ABI. Interestingly, during this transaction, ABI purchased $200 million of its shares directly from Altria.
Altria Group reported its YOY results for Q1’24. Although revenue slightly declined by 2.5%, reported diluted EPS increased by 21%,
Mapping out the road ahead, the company reaffirmed its full-year EPS guidance for this year, projecting a range of $5.05 to $5.17. This represents a growth rate of 2% to 4.5% over FY'23.
Altria Group has also been a consistent dividend payer. MO stock pays $3.92 annually, translating to an 8.76% yield. Impressively, the company has increased its dividends for 54 consecutive years. Overall, the consensus has a positive sentiment toward MO stock, with an 88% buy signal.
Final Thoughts
Barchart Opinion is an excellent complementary indicator for high-yielding Dividend Kings, as it gives you a technical advantage. Of course, don’t forget to do your due diligence, review your chosen company’s financials, and look out for warning signals.
On the date of publication, Rick Orford did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
