Some companies pay out a percentage of their earnings to shareholders as a dividend, and restaurant company Domino's Pizza (DPZ 1.78%), home-goods retailer Williams-Sonoma (WSM 2.52%), and swimming pool supplies company Pool Corporation (POOL 1.96%) are three of those companies. 

The term "magnificent" from the headline could apply to these three dividend payers. But allow me to explain what makes them magnificent, in my opinion. Each company has paid an uninterrupted quarterly dividend for some time -- Domino's since 2013, Williams-Sonoma since 2006, and Pool Corp. since 2013. Moreover, each dividend stock has regularly increased its quarterly payments, leading to sensational dividend growth over the past decade, as the chart below shows.

WSM Dividend Chart.

WSM Dividend data by YCharts.

Shares of Domino's, Williams-Sonoma, and Pool Corp are all down more than 40% from their respective all-time highs, marking a substantial drawdown for these consistent companies. And that could make them attractive buying opportunities for some investors. As we'll see, each stock trades at a downright cheap valuation.

1. Domino's Pizza

As of this writing, Domino's stock trades at a price-to-earnings (P/E) valuation of 26. Its cheapest P/E ratio over the past decade is only a hair lower at about 24, which was only reached in a couple of brief instances in 2019 and 2022. Therefore, right now, there's one of the cheapest opportunities to invest in Domino's stock -- a stock that's up over 550% over the past 10 years.

I don't expect 550% returns for Domino's Pizza stock over the next decade. Indeed, the company only expects to grow global retail sales by 4% to 8% per year over the next two to three years. That modest growth will likely lead to modest stock performance as well. 

That said, Domino's increased its market share in the pizza space once again in 2022, according to management -- a testament to its strength and resilience. And the company has a long, uninterrupted history of profitability, even through the Great Recession. Therefore, Domino's is still a high-quality business, albeit with more modest growth at the moment. For these reasons, this is a dip worth buying.

2. Williams-Sonoma

Late in 2022, Williams-Sonoma stock dipped below a P/E ratio of 7, which was the cheapest the stock had been in over a decade -- even cheaper than the market crash of 2020. Right now, Williams-Sonoma stock still trades at a downright cheap valuation, with a P/E ratio slightly above 7.

Being a profitable business and having a cheap stock is a great combination for Williams-Sonoma shareholders right now. Management is repurchasing shares at an aggressive pace -- the outstanding share count is down 20% over just the last five years, providing a huge additional boost to its earnings-per-share (EPS) growth, as the chart below shows.

WSM EPS Diluted (TTM) Chart.

WSM EPS Diluted (TTM) data by YCharts.

Looking ahead, Williams-Sonoma's management expects to grow revenue modestly, and it also expects its operating margin to contract from about 17% in its fiscal 2022 (which ended in January) to about 15% in fiscal 2023. However, the company just authorized management to repurchase $1 billion in shares, or about 13% of shares outstanding.

Considering management repurchased $880 million in shares during fiscal 2022, it's possible that Williams-Sonoma could use all $1 billion of its authorization in the coming year alone. And as long as the stock stays this cheap, that will be a big boost to shareholder value at an attractive price.

3. Pool Corporation 

Finally, Pool Corp. may be the least-known stock on this list, and that's a shame. This pool supplies company went public in 1995 and is up more than 36,000% since, making it one of the greatest stocks over the last 30 years. And regarding valuation, Pool stock never dipped below a P/E ratio of 20 from 2011 until 2022.

Pool stock finally dipped below a P/E ratio of 20 in 2022, and it still trades below this threshold today with a P/E of just 18 -- a historical bargain for this market-beater.

Pool Corporation's sales have roughly doubled since the beginning of the COVID-19 pandemic. And having experienced such robust growth in recent years, management expects revenue in 2023 to finally moderate, coming in the same as or even slightly less than revenue in 2022. However, there is still reason for long-term optimism.

According to management, more than half of Pool Corporation's revenue comes from ongoing pool maintenance products -- this spending should be considered non-discretionary and gives the company a fairly reliable income stream. Moreover, with over 420 retail locations, Pool Corp. is the largest wholesale pool equipment company in the world, giving it an edge for winning business in new pool construction and remodels.

Like the other two companies on this list, Pool Corp. is also boosting shareholder value by reducing its share count, albeit at a slower rate. The share count is down about 18% over the past decade, a trend that should continue -- management still has $230 million available from its previous authorization.

DPZ Average Diluted Shares Outstanding (Quarterly) Chart.

DPZ Average Diluted Shares Outstanding (Quarterly) data by YCharts.

Great dividends at a reasonable value

Growth for Domino's and Pool Corp. is slowing. And Williams-Sonoma's margins are contracting. In short, there are reasons that these stocks are down more than 40% and trade at historically inexpensive valuations. However, as we've seen in this article, these are durable businesses as well, and they're still in a position to create long-term shareholder value.

Moreover, all three companies have grown their dividends by a substantial amount over the last decade. And there's reason to believe that will continue for the foreseeable future. The dividend payout ratios are low for these companies -- 35% for Domino's, 20% for Pool Corp, and 19% for Williams-Sonoma. All three could double their dividends from here without placing themselves in a hard place financially.

Therefore, if you're looking for dividend growth, Domino's, Williams-Sonoma, and Pool Corp. could provide above-average potential, which is another reason to consider this trio today.