It's a dream many investors share: finding stocks they can simply buy and hold and never have to sell. Warren Buffett himself is most likely a member of that club -- he has famously said that his favorite holding period is forever.

It's quite a challenge to find companies that fit that bill. Even among the Fortune 500, the average corporate life expectancy is only around 40 to 50 years. You may very well invest for longer than that, which makes it critical for you to invest in only the best of the best if you truly want to own stocks you'll never have to sell.

Can you tell who will last?
There are still no guarantees in investing, but there are some common traits that long-lived companies often share:

Strong economic moats protecting their businesses: Oil pipeline firms like Kinder Morgan Energy Partners (NYSE:KMP), for instance, are literally in the business of digging moats. Pipelines are capital-intensive eyesores that often garner huge resistance when they're run near populated areas. Those factors tend to favor entrenched players who've already got a strong infrastructure built.

Value-focused management: Wal-Mart (NYSE:WMT) is so famously cheap that its founder Sam Walton used to share rooms with colleagues at budget motels while on business trips. Contrast that with the wild executive excesses like the $1,200 trash bin that got former Merrill Lynch CEO John Thane fired after that company failed.

Policies that reward long-term shareholders: Perhaps the clearest way to tell whether a company is trying to be a one-decision stock is how well it treats its shareholders. Firms that actively reward their shareholders as their businesses prosper are ones more likely to view those shareholders as business owners, rather than mere financiers. The most direct way a company can reward its shareholders is with dividends.

The cornerstone of one-decision stocks
In fact, those dividends should be of primary importance to you in your quest to find your own one-decision stocks. After all, aside from dividends, the only other way to get money out of your investments is to sell your shares. If you sell them, then you're not an owner anymore. Ironically, you've not only made a second decision on your stock, but to remain an investor somewhere, you have to even make a third decision on what to buy to replace what you've sold.

Over time, in fact, dividends can potentially become even more lucrative than selling your shares. Oh, sure, you may only get a few percent on your investment the first year you own a dividend-paying stock, but those dividends can keep coming as long as the company succeeds. And not only can they keep getting paid, but as the company grows over time, those payments can grow right along with it.

Just take a look at how much the payouts on these companies have grown since 1999:


Current Dividend

1999 Dividend

10-Year Change

Payout Ratio

Praxair (NYSE:PX)





International Business Machines (NYSE:IBM)





United Technologies (NYSE:UTX)





Hasbro (NYSE:HAS)





General Dynamics (NYSE:GD)





Not only have their dividends climbed dramatically over the past decade, but with payout ratios below 50% of earnings, they still potentially have even more room to grow.

Yesterday, today, and tomorrow
Nobody can predict with 100% certainty what the future will bring -- even Warren Buffett himself acknowledged that he overpaid for ConocoPhillips when oil was near its peak. By looking for companies that routinely raise their dividends and have room to continue doing so in the future, you can improve your chances of finding your own one-decision stocks.

At Motley Fool Income Investor, we understand just how powerful those seemingly small dividend payouts can be. Getting cash today is nice, but it's the long-term stream of income that grows over time that truly makes those payments worthwhile -- especially when combined with strong economic moats and value-focused management.

If you're looking to find stocks that can reward you today, tomorrow, and potentially for as long as you own them, then join us now for your 30-day free trial of Income Investor.

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At the time of publication, Fool contributor Chuck Saletta owned shares of Kinder Morgan Management, a related company to Kinder Morgan Energy Partners. Hasbro is a Motley Fool Stock Advisor selection. Wal-Mart is a Motley Fool Inside Value pick. The Fool has a disclosure policy.