2011's Top Dividend Aristocrats

Yes, dividend investing is popular. And it may become even more popular, now that Congress has extended legislation that maintains the low tax rate on corporate payouts for next year. You can find many great dividend stalwarts among the companies that have successfully paid out cash for decades.

When searching for great dividend stocks, it makes a lot of sense to start with companies that have been playing the dividend game the longest. Standard & Poor's has culled the dividend winners from the also-rans in a list it calls the "dividend aristocrats." These companies have paid and increased their dividend for at least 25 years.

Standard & Poor's just announced its annual adjustment to the dividend aristocrats, so this is the latest version of the popular list. Below are the highest-yielding constituents:

Company

Dividend Yield

5-Year Growth Rate

CenturyLink (NYSE: CTL  )

6.5%

64.7%

Pitney Bowes (NYSE: PBI  )

6.2%

3.3%

Cincinnati Financial (Nasdaq: CINF  )

5.1%

6.6%

Leggett & Platt (NYSE: LEG  )

4.9%

11.1%

Consolidated Edison (NYSE: ED  )

4.9%

0.9%

Kimberly-Clark (NYSE: KMB  )

4.3%

8.1%

Abbott Laboratories (NYSE: ABT  )

3.7%

9.7%

Clorox (NYSE: CLX  )

3.5%

13.4%

Johnson & Johnson (NYSE: JNJ  )

3.5%

10.9%

McDonald's (NYSE: MCD  )

3.1%

26.8%

Automatic Data Processing (NYSE: ADP  )

3.1%

17.0%

Procter & Gamble (NYSE: PG  )

3.0%

11.7%

PepsiCo (NYSE: PEP  )

3.0%

13.7%

VF Corp. (NYSE: VFC  )

2.9%

17.3%

Bemis (NYSE: BMS  )

2.8%

5.5%

Coca-Cola (NYSE: KO  )

2.7%

9.7%

PPG Industries (NYSE: PPG  )

2.7%

3.4%

McGraw-Hill (NYSE: MHP  )

2.6%

7.6%

Chubb Corp. (NYSE: CB  )

2.5%

11.7%

3M (NYSE: MMM  )

2.5%

5.2%

ExxonMobil (NYSE: XOM  )

2.4%

9.0%

McCormick (NYSE: MKC  )

2.4%

10.5%

Emerson Electric (NYSE: EMR  )

2.3%

10.1%

Wal-Mart (NYSE: WMT  )

2.2%

17.8%

Air Products & Chemicals (NYSE: APD  )

2.2%

9.0%

Source: Standard & Poor's.

According to a study by Ibbotson, reinvested dividends made up about 40% of total stock returns from 1926 to 2006. In fact, dividend investing is so appealing that superinvestor Warren Buffett has made it a significant component of his portfolio.

Given their strong track records, these stocks are a great place to begin your research, but they're not formal recommendations. High yields could be time bombs, and that really attractive high yield could suddenly die. So investigate such companies thoroughly, and diversify across sectors, no matter how delicious that dividend looks.

For a basket of some high-yield some dividend opportunities, click here to get The Motley Fool's five-page free report: 13 High-Yielding Stocks to Buy Today.

Coca-Cola, 3M, and Wal-Mart are Motley Fool Inside Value selections. Coca-Cola and Wal-Mart are Motley Fool Global Gains picks. ADP, Clorox, Emerson, Johnson & Johnson, Kimberly-Clark, Coca-Cola, McCormick, PepsiCo, and Procter & Gamble are Motley Fool Income Investor recommendations. Motley Fool Options has recommended diagonal call positions on Johnson & Johnson and PepsiCo. The Fool owns shares of and has written covered calls on P&G, and also owns shares of Coca-Cola, ExxonMobil, Johnson & Johnson, and Wal-Mart. Motley Fool Alpha owns shares of Abbott and Johnson & Johnson. Try any of our Foolish newsletter services free for 30 days. Phew. Give us a moment to catch our breath, OK?

Jim Royal, Ph.D., owns shares of P&G and J&J. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


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  • Report this Comment On December 24, 2010, at 8:16 PM, busterbuddy wrote:

    Would be interesting to run these stocks as a index and see how they turn out. Of course Funds like Vanguard with names like Vanguard Dividend growth have most of these companies. I've never understood why a Dividend Growth fund would have Exxon in it. The yield is bad given the revenue and reserves. And the growth of the stock is not that good. insiders getting stock options and high pay are the ones making money on XOM>

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