Dividend-paying stocks like these tend to beat the broader market over the long haul
Seasoned dividend investors know that there are big
differences between stocks that pay dividends and companies that legitimately
have “dividend stocks.” Companies in the latter category have, in many cases,
displayed lengthy commitments to not only paying dividends but growing payouts
as well.
Many investors label companies with long dividend track
records as “dividend aristocrats.” That is not just a catchy term. There are
indices devoted to dividend aristocrats, including the S&P 500 Dividend
Aristocrats Index. The Dividend Aristocrats Index, which serves as the
benchmark for a well-known exchange-traded fund (ETF), holds companies with
dividend increase streaks of at least 25 years.
The index gauges the “performance of S&P 500 companies
that have increased dividends every year for the last 25 consecutive years. The
Index treats each constituent as a distinct investment opportunity without
regard to its size by equally weighting each company,” according to S&P Dow
Jones Indices.
While many dividend aristocrat stocks are trailing the
broader market this year, historical data suggest dividend growers usually
outpace broader benchmarks over the long haul. Here are some dividend
aristocrats to consider buying now.
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