Buying and holding great dividend stocks is arguably the best way to predictably generate wealth over the long term. And of course, it helps if both the share prices and dividends of those stocks are poised to grow over time.

To help point you in the right direction to that end, we asked three top Motley Fool investors to each discuss a growth dividend stock they believe investors would be wise to purchase this month. Read on to see why they chose Corning (GLW -0.19%), ONEOK (OKE), and Enbridge (ENB -0.32%).

Three stacks of coins, each larger than the previous one, sitting on soil with green leaves growing out of them.


Putting billions back in shareholders' pockets

Steve Symington (Corning): I previously singled out Corning as a promising growth dividend stock to buy almost exactly eight months ago. And though shares of the glass technology specialist have returned more than 30% since then, excluding dividends, I still think Corning is worth buying today.

Corning shares rightly climbed to a 10-year high following its latest strong quarterly report. In it, Corning confirmed that core sales rose 14.5% year over year, to $2.485 billion, led by 34% growth in optical communications revenue, to $818 million, as telecommunications leaders invested billions in optical fiber to build out their respective next-gen networks.

Corning also saw revenue from its smaller specialty materials segment grow 32%, to $300 million, driven by strong demand for its latest high-margin Gorilla Glass products. And though sales in its core display technologies business rose just 2%, to $846 million, earnings for the segment climbed 15%, to $256 million, thanks to continued increases in efficiency, moderating LCD glass price declines, and ongoing cost-reduction efforts.

To that end, Corning's consolidated bottom line continued to fare well last quarter, with core earnings rising 19.7%, to $407 million. And thanks to the company's ambitious share repurchases, core earnings per share climbed 39.3% last quarter, to $0.39. As a reminder, Corning has promised to boost its dividend payments by at least 10% each year through 2019, and has already returned $6.5 billion to shareholders in the form of dividends and repurchases as part of a $12.5 billion goal set almost two years ago.

With Corning stock still trading below 16 times this year's expected earnings, I think investors who buy now and watch Corning fulfill that goal should be poised to enjoy more market-beating returns from here.

ONEOK's merger set to drive big dividend growth

Jason Hall (ONEOK Inc.): Now that ONEOK has completed its acquisition of ONEOK Partners, the natural gas and natural gas liquids gathering systems and pipeline operator is set to grow its dividend sharply. The company expects to increase the dividend an incredible 21% this year, and follow that up with 9%-11% growth each year through 2021. 

Considering that ONEOK shares are already yielding very close to 5% at recent prices, this is a fantastic opportunity to buy one of the best midstream energy companies and lock in very aggressive income growth that could see investors getting an insanely good yield on their original investments -- approaching 9% by 2021. And it's not just the short-term dividend growth that has me excited about owning ONEOK.

Over the past couple of years, the company has done a solid job structuring its long-term contracts to reduce its exposure to commodity prices. That may put a bit of a lid on the upside to its cash flows if commodity prices -- particularly natural gas liquids -- were to sharply increase, but it also means the company's ability to sustain the dividend is almost unquestioned. 

Furthermore, there's growth in the pipeline, with as much as $2.5 billion in new projects under development. These projects are set to increase ONEOK's access to some of the fastest-growing plays, such as Oklahoma's STACK, which will further boost distributable cash flows. 

There's some risk here, as ONEOK is more leveraged than many of its peers. But that risk is balanced by the outstanding opportunity for reliable income growth. 

Perhaps the clearest path to a growing dividend

Chuck Saletta (Enbridge): Canadian pipeline giant Enbridge has done something that very few companies are willing to do: It has projected its dividend growth all the way out to 2024, expecting hikes of 10% to 12% annually during that time period. Both the act of projecting its dividend that far out and the strength of its expected dividend growth over that time are incredible displays of its expected corporate financial strength.

Behind that unusually strong projection sits an equally strong business model -- that of an energy toll-road operator. Enbridge is North America's largest energy infrastructure company (thanks in part to its recent acquisition of Spectra Energy),  with pipelines, processing facilities, and generating plants across the U.S. and Canada. Enbridge makes much of its money moving energy from where it's produced to where it's consumed. As long as there's demand for energy in places far away from where it's produced, those types of services will be needed.

Still, that near certainty of demand is only part of the story. It provides a reason to believe that Enbridge can maintain its dividend over time, but the ability to grow that dividend comes from two key places:

  • First, Spectra has very strong plans to continue expanding its infrastructure network, increasing the carrying capacity -- and thus, cash-generating capabilities -- of its pipelines.
  • Second, Enbridge recently acquired fellow pipeline-giant Spectra Energy and expects to be able to wring out over $400,000,000 of annual synergy savings by combining the two companies' operations. 

Those two factors, in addition to the toll-booth-like nature of its base operations, give Enbridge a real opportunity to provide a growing income stream to its shareholders.