You don't search for dividend stocks that require high maintenance. Investors prefer to buy set-and-forget kinds of stocks that pay solid dividends quarter after quarter. The less drama, the better.
Dividend Aristocrats tend to meet these criteria. These are stocks that have not only paid out dividends regularly but also increased their dividends for at least 25 consecutive years. Here are three great Dividend Aristocrats that you can buy and hold forever.
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1. Abbott Labs
Abbott Labs (ABT -0.03%) has several healthcare irons in the fire. The company ranks as a top medical-device maker. It runs a huge diagnostics business. Abbott markets established pharmaceutical products, particularly in emerging markets. And it has a global nutrition products business.
These varied businesses provide a consistent revenue stream for Abbott. That's enabled the company to boost its dividend for 47 years in a row. While you might not think Abbott's current dividend yield of a little over 1.5% is impressive, consistent annual dividend increases add up over time.
What's especially appealing about buying Abbott Labs stock right now is that it's poised for tremendous growth. The company awaits U.S. Food and Drug Administration (FDA) clearance for a new version of its super-popular Freestyle Libre continuous glucose monitoring system. The new device is expected to be a massive commercial success for Abbott. The company also should enjoy strong sales growth from its Alinity line of diagnostics systems and its MitraClip mitral valve clip.
Long-time Abbott CEO Miles White plans to transition to the role of Executive Chairman in March 2020. This shouldn't be a concern at all for investors, though. White will hand the reins over to Abbott's current president and COO Robert Ford, who has been with the company for 23 years and led the launch of Freestyle Libre.
2. Air Products and Chemicals
If you're looking for a dividend stock that's on a roll, you'll probably love Air Products and Chemicals (APD 0.17%). Shares of the industrial giant have soared close to 50% so far in 2019.
Air Products and Chemicals focuses primarily on marketing atmospheric gases used in industrial processes and equipment used for separation, storage, and transport of these gases. It's the world's largest supplier of hydrogen and ranks as a leader in supplying helium and in natural gas liquification.
The company has increased its dividend for 37 consecutive years. Its dividend yield currently stands at just under 2%. Keeping the dividends flowing shouldn't be a problem, with Air Products' payout ratio at close to 58%.
Perhaps the best reason to like Air Products is the management team's focus on generating long-term shareholder value. The company continually looks for ways to deploy capital more effectively and more profitably. Its performance this year reflects this shareholder-friendly strategy.
3. Chubb
There's a great reason Warren Buffett likes the insurance business: It generates steady cash flow. While Buffett doesn't own Chubb (NYSE: CB), it's the kind of stock he'd probably love.
Chubb is the largest publicly traded property and casual insurer in the world. It takes pride in its underwriting expertise and solid financial strength. The company's operations span across the globe, with nearly 40% of premiums coming from outside the United States.
The company joined the Dividend Aristocrats club last year and notched its 26th consecutive year of dividend increases in 2019. Chubb's dividend yields nearly 2%. The company also boasts a low payout ratio of 37%.
Is Chubb likely to deliver the kind of growth that some dividend stocks like Abbott Labs will? Probably not. But while property and casualty insurance isn't the most exciting business in the world, it's delivers a reliable stream of cash, especially when a company has the extensive industry track record Chubb has.
