Dividend Aristocrats—S&P 500 companies that have consecutively increased dividends for 25 years or more—are excellent choices for consistent and reliable payouts. Companies in this prestigious group are favorites of income investors and those building their retirement nest eggs.
Today, the S&P 500 Aristocrat index currently includes 67 companies, and to be perfectly honest, few of us have the time to go through the entire list to find out which ones pay the highest dividends. Thankfully, there are tools that investors can use to make the search easier. Even better, you have me to list the top three Aristocrats with the highest yields. So, let’s get to it.
How I Screen For High-Yield Dividend Aristocrats
Barchart offers many features and functionality (most of them free) that can be used to take the pain out of stock selection. I used a previously prepared Dividend Aristocrats watch list for this selection and organized them by the highest yields using the stock screener.
To screen for the highest-yielding Dividend Aristocrats, I begin by logging into Barchart.com and clicking “Watchlist” at the top of the website. Then, I select Aristocrats from the watchlist dropdown and click the “Div Yield” field to sort by dividend yield.
If you don't already have an Aristocrats watchlist, click “New Watchlist” and then add the symbols. You're also able to add several other filters to refine searches further. But I understand that people are busy, so let’s list the three Dividend Aristocrats with the highest yields, starting with number one:
Amcor (AMCR)
First on our list of high-yielding Dividend Aristocrats is Amcor. This company specializes in flexible and rigid plastic packaging sold in EMEA and the Asia Pacific. The company’s global packaging solution has generated over $14.7 billion in sales, with over 218 production and distribution sites worldwide. Amcor provides packaging for various industries, including food and beverage, pharmaceuticals, and personal care.
Amcor currently pays a $0.125 quarterly dividend or 50-cent forward annual rate, representing a 5.38% yield for AMCR stock based on its last trading price. This attractive yield is further compounded by a 104.17% 5-year dividend growth rate, albeit with a slightly high yet acceptable 72.37% payout ratio.
3M Company (MMM)
There’s a big chance that people reading this have a 3M product somewhere in their home. The company operates as a multinational conglomerate that offers products across several industries, including automotive, electronics, health care, safety, manufacturing, transportation, and general consumer markets.
3M Company is a known innovator with over 100,000 product patents, the newest of which is the Padded Automatable Curbside Recyclable (PACR) Mailer Material. This is the first paper-based padded and fully recyclable packaging material that can be slotted into qualified automated packaging machines for automation. PACR is lightweight, heat-sealable, durable, resists moisture penetration, and comes in various sizes.
The company currently pays $6.04 in annualized dividends per share, per the latest increase in February 2024, which translates to a 5.76% yield for MMM.
Given 3M’s struggles in 2023, full-year 2024 guidance sees adjusted EPS ending between $9.35 and $9.75, comfortably covering its annual payout.
The company has increased dividend payments for 64 consecutive years, making it a Dividend Aristocrat and King. Further, 3M has also been paying dividends for over 100 years, ranking it among the few Dividend Zombies in the market.
Realty Income Corp (O)
Realty Income Corp is one of the most recognizable Dividend Aristocrats today. It is a real estate investment trust that focuses on commercial property investments in the US and various parts of the world. As of 2024, the company has long-term agreements with over 15,450 properties worldwide, which it uses to fund further investments and pay out an unbroken string of monthly dividends for shareholders.
Speaking of dividends, Realty Income recently increased its dividend, starting with the April 2024 payout. The new dividend is $0.2570 per share. For O stock, that translates to a 5.91% forward yield.
The company has also increased dividends for 106 consecutive quarters, or over 26 years, and boasts a 4.3% compound annual dividend growth rate since 1994.
By law, REITs must pay 90% of their earnings to investors, and funds from operations, or FFO, is a more suitable metric for measuring a REIT’s capacity to pay dividends. If you're an O stock shareholder, you'll be happy to know that management expects 2024 normalized FFO and adjusted FFO to end between $4.17-$4.29 and $4.13-$4.21, respectively- more than enough to cover the dividend.
As a result, dividend payouts—and the expected quarterly dividend increases—are more or less assured for investors, making O an excellent and reliable Dividend Aristocrat.
Final Thoughts
Investment doesn’t have to be a fancy word for“gambling.” Dividend Aristocrats are safe for investors with milder dispositions, and yet these stocks don’t preclude growth over the long run. Patience is a virtue, as they say, and the potential returns are even better when tempered with good stock picks.
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.
