Dividend stocks give investors the benefit of receiving regular passive income inside a growth investment. Investors can use the consistent cash flow from dividends to cover living expenses, buy other investments, or reinvest them to maximize their total return.
Companies that pay dividends are generally mature companies that generate free cash flow that they can deploy to reward shareholders. And once companies start paying dividends, they are likely to make paying their dividend a priority.
However, like any investment, some dividend stocks are better than others. This special presentation highlights seven dividend achievers. This is a group of companies that have increased their dividend for at least 10 consecutive years.
This is significant due to the benefit of compounding. This is when you reinvest the dividends you earn to buy more shares. Over time your investment grows, which allows you to earn a larger dividend. It's a proven low-risk wealth building strategy.
Quick Links
- Albemarle
- Texas Instruments
- Lennox International
- Caterpillar
- Tractor Supply
- Altria Group
- Royal Gold
#1 - Albemarle (NYSE:ALB)
Albemarle Corp. (NYSE: ALB) is one of the top lithium miners in the world. Lithium is one of the core materials needed in battery applications – including electric vehicles.
With the Trump trade firmly in place in the United States, you may feel that lithium stocks are a bad investment. Albemarle’s revenue and earnings are sharply lower in 2024. This move correlates to the fall in lithium prices as the EV market is well supplied.
However, the EV revolution will continue to move forward, and it may even accelerate. That’s why lithium stocks are likely to outperform in the coming years.
How long will you have to wait for this growth? ALB stock is down approximately 33% in 2024, but it’s expected to show strong earnings growth in 2025. Albemarle stock has delivered a total return of 56.81% over the past five years. That includes a dividend that Albemarle has increased for 30 consecutive years and has a 1.68% yield.
About Albemarle
Albemarle Corporation develops, manufactures, and markets engineered specialty chemicals worldwide. It operates through three segments: Energy Storage, Specialties and Ketjen. The Energy Storage segment offers lithium compounds, including lithium carbonate, lithium hydroxide, and lithium chloride; technical services for the handling and use of reactive lithium products; and lithium-containing by-products recycling services.
Read More - Current Price
- $96.58
- Consensus Rating
- Hold
- Ratings Breakdown
- 7 Buy Ratings, 15 Hold Ratings, 1 Sell Ratings.
- Consensus Price Target
- $117.30 (21.5% Upside)
#2 - Texas Instruments (NASDAQ:TXN)
Texas Instruments (NASDAQ: TXN) is a company in the semiconductor industry. In 2023, 74% of the company’s revenue came from analog chips. These chips take in inputs like sound or temperature and convert that information into digital form.
A core audience for the company’s analog chips is the automotive industry, particularly in China. While the semiconductor sector at large is in a slump, the slowdown is less pronounced in the automotive sector. That shows up in analysts’ earnings estimates for 2025, which show a 13.8% gain. Those expectations have been going up since the company’s October 2024 earnings report.
That’s one reason that TXN stock is up 23.9% in 2024 but is facing resistance near its all-time high around $213. And with a forward price-to-earnings ratio of around 41x earnings, investors may want to wait for a better entry point.
But if you do get involved, you’ll benefit from a dividend that has been growing for 21 consecutive years and has a yield of 2.54%.
About Texas Instruments
Texas Instruments Incorporated designs, manufactures, and sells semiconductors to electronics designers and manufacturers in the United States and internationally. The company operates through Analog and Embedded Processing segments. The Analog segment offers power products to manage power requirements across various voltage levels, including battery-management solutions, DC/DC switching regulators, AC/DC and isolated controllers and converters, power switches, linear regulators, voltage references, and lighting products.
Read More - Current Price
- $214.97
- Consensus Rating
- Hold
- Ratings Breakdown
- 9 Buy Ratings, 11 Hold Ratings, 3 Sell Ratings.
- Consensus Price Target
- $206.95 (3.7% Downside)
#3 - Lennox International (NYSE:LII)
The housing market is expected to get a boost as the economy improves. Lennox International Inc. (NYSE: LII) is one of the construction sector stocks to keep an eye on. The company is known for its heating and cooling products. Demand remains strong, as shown by year-over-year topline and bottom-line growth.
LII stock is up more than 34% in 2024, and it’s been finding resistance around $620 per share. That’s one reason analysts give the stock a consensus Hold rating and suggest the stock may drop. But since the company’s earnings report in late October, analysts are beginning to raise their price targets
If you’re looking to get involved, Lennox stock trades at around 29x forward earnings, which is decidedly lower than the average 41x earnings of the construction sector. And the company’s dividend has been increasing for 15 consecutive years and has increased at an average annual rate of over 12% in the last three years, nearly five times the current rate of inflation.
About Lennox International
Lennox International Inc, together with its subsidiaries, designs, manufactures, and markets a range of products for the heating, ventilation, air conditioning, and refrigeration markets in the United States, Canada, and internationally. The Home Comfort Solutions segment provides furnaces, air conditioners, heat pumps, packaged heating and cooling systems, indoor air quality equipment, comfort control products, and replacement parts and supplies; residential heating, ventilation, cooling equipment, and air conditioning; and evaporator coils and unit heaters under Lennox, Dave Lennox Signature Collection, Armstrong Air, Ducane, AirEase, Concord, MagicPak, Advanced Distributor Products, Allied, Elite Series, Merit Series, Comfort Sync, Healthy Climate, iComfort, ComfortSense, and Lennox Stores name.
Read More - Current Price
- $604.78
- Consensus Rating
- Hold
- Ratings Breakdown
- 5 Buy Ratings, 6 Hold Ratings, 1 Sell Ratings.
- Consensus Price Target
- $583.92 (3.4% Downside)
#4 - Caterpillar (NYSE:CAT)
Caterpillar Inc. (NYSE: CAT) is another way that investors can invest in the construction sector. The company’s stock has been on a tear in the past 12 months as infrastructure spending continues to make its way into the economy.
Prior to the U.S. presidential election on November 5, 2024, CAT stock was down more than 3% after a double miss in its third quarter earnings report. However, with the outcome of the election known, investors are stepping on the gas in expectation that there will be demand for the company’s heavy equipment.
One question will be if analysts will follow this price movement by raising their price targets. Trading at around 18.9x forward earnings, CAT stock carries a slight premium to other heavy equipment companies. But the company’s solid financials including a dividend that has grown for 30 consecutive years is a good reason to add Caterpillar to your portfolio heading into 2025.
About Caterpillar
Caterpillar Inc manufactures and sells construction and mining equipment, off-highway diesel and natural gas engines, industrial gas turbines, and diesel-electric locomotives in worldwide. Its Construction Industries segment offers asphalt pavers, compactors, road reclaimers, forestry machines, cold planers, material handlers, track-type tractors, excavators, telehandlers, motor graders, and pipelayers; compact track, wheel, track-type, backhoe, and skid steer loaders; and related parts and tools.
Read More - Current Price
- $416.97
- Consensus Rating
- Hold
- Ratings Breakdown
- 7 Buy Ratings, 8 Hold Ratings, 3 Sell Ratings.
- Consensus Price Target
- $358.19 (14.1% Downside)
#5 - Tractor Supply (NASDAQ:TSCO)
Tractor Supply Co. (NASDAQ: TSCO) is a retail stock that is set up to outperform the sector heading into 2025. TSCO stock has pulled back from an all-time high after a mixed earnings report in which the company issued cautious guidance for coming quarters.
And earnings may be affected by Tractor Supply’s planned all-cash acquisition of the online pet pharmacy, Allivet. Tractor Supply already generates about 25% of its revenue from pet supplies, so this acquisition aligns with the company’s existing business model. The acquisition is expected to add $15 million to Tractor Supply’s 2025 top line. That would almost double the company’s projected full-year revenue for 2014.
The deal is expected to close in the first quarter of 2025. However, this looks like an ideal opportunity for investors to buy the dip. That was true even before the outcome of the presidential election became clear. If the economy begins to grow as expected, analysts are likely to look past the company’s somewhat lofty valuation.
About Tractor Supply
Tractor Supply Company operates as a rural lifestyle retailer in the United States. The company offers various merchandise, including livestock and equine feed and equipment, poultry, fencing, and sprayers and chemicals; food, treats, and equipment for dogs, cats, and other small animals, as well as dog wellness products; seasonal and recreation products comprising tractors and riders, lawn and garden, bird feeding, power equipment, and other recreational products; truck, tool, and hardware products, such as truck accessories, trailers, generators, lubricants, batteries, and hardware and tools; and clothing, gift, and décor products consist of clothing, footwear, toys, snacks, and decorative merchandise.
Read More - Current Price
- $288.95
- Consensus Rating
- Hold
- Ratings Breakdown
- 12 Buy Ratings, 9 Hold Ratings, 2 Sell Ratings.
- Consensus Price Target
- $282.82 (2.1% Downside)
#6 - Altria Group (NYSE:MO)
Altria Group Inc. (NYSE: MO) is the only dividend king on this list. The company is one of the big-3 international tobacco companies and is the parent company of Phillip Morris. The company falls into the “sin stock” category. However, these stocks tend to be defensive in nature because people will buy the company’s products even when the economy is slowing.
The growth thesis for Altria centers around its pivot into smokeless tobacco products. Altria is seeing significant market share gains with its NJOY and on! Brands. In its most recent quarter, the company reported it had tripled device shipments. And it now has 6.2% market share after the FDA approved its menthol e-cigarettes.
The analyst outlook for Altria is mixed. Nevertheless, several analysts give MO stock a price target of $60. That would be about a 10% gain from the current price. But when you include the company’s 7.49% dividend yield, investors are forecast to get a total return that’s slightly above the stock’s five-year average total return of around 15%.
About Altria Group
Altria Group, Inc, through its subsidiaries, manufactures and sells smokeable and oral tobacco products in the United States. The company offers cigarettes primarily under the Marlboro brand; large cigars and pipe tobacco under the Black & Mild brand; moist smokeless tobacco and snus products under the Copenhagen, Skoal, Red Seal, and Husky brands; oral nicotine pouches under the on! brand; and e-vapor products under the NJOY ACE brand.
Read More - Current Price
- $54.28
- Consensus Rating
- Hold
- Ratings Breakdown
- 2 Buy Ratings, 3 Hold Ratings, 2 Sell Ratings.
- Consensus Price Target
- $51.33 (5.4% Downside)
#7 - Royal Gold (NASDAQ:RGLD)
Royal Gold Inc. (NASDAQ: RGLD) is an intriguing investment option if you’re looking to get in on the growth of gold. Gold has been one of the best-performing assets in 2024. The reason for the metal’s growth is based on the increase in government spending over the past four years. That's not new, but what is new is that there seems to be a growing bipartisan sentiment that the nation’s national deficit is unsustainable.
Mining stocks are an alternative to owning physical gold. However, Royal Gold is not an ordinary mining company. Instead, the company acquires and manages precious metals streams and royalties while the companies are in the production, development, or exploration stage in exchange for stream or royalty interests.
Analysts project the company’s earnings will grow by more than 26% in 2024. And analysts have a price target of $159.50 which is a 10% increase in addition to the company’s 1.1% dividend yield. The company has increased that dividend for 24 consecutive years including an average annual return of over 10% in the last three years.
About Royal Gold
Royal Gold, Inc, together with its subsidiaries, acquires and manages precious metal streams, royalties, and related interests. The company engages in acquiring stream and royalty interests or to finance projects that are in production, development, or in the exploration stage in exchange for stream or royalty interests, which primarily consists of gold, silver, copper, nickel, zinc, lead, and other metals.
Read More - Current Price
- $144.84
- Consensus Rating
- Hold
- Ratings Breakdown
- 2 Buy Ratings, 5 Hold Ratings, 1 Sell Ratings.
- Consensus Price Target
- $159.50 (10.1% Upside)
Within the group of dividend achievers, you'll find stocks that have increased their dividend by 25 or 50 consecutive years. These are known as dividend aristocrats and dividend kings, respectively. Therefore, every dividend aristocrat and dividend king is a dividend achiever, but the opposite is not true.
Dividend achievers can be the target of traders. But, generally speaking, these are stocks you're looking to hold for some time. That's because moving quickly in and out of these stocks diminishes the benefit of compounding. While they may not be stocks you own forever, a long position is the best strategy for maximizing your gains in these stocks.
MarketBeat provides a free tool with a current list of Dividend Achievers that you can filter by characteristics such as market cap, sector, and analyst sentiment. And once you find a stock to add to your portfolio or watchlist, you can count on MarketBeat to keep you current on news that affects that stock.
More Investing Slideshows:
