What's the most exclusive group of dividend stocks? It might not be what first comes to mind.

Many investors are familiar with Dividend Aristocrats. These stocks are members of the S&P 500 that have increased their dividends for at least 25 consecutive years.

But there's an even more elite group of dividend stocks that doesn't receive as much attention: Dividend Kings. To become a Dividend King, a company must boost its dividend for at least 50 years in a row. Here's what you need to know about the current Dividend Kings and how they can fit into your investment portfolio.

Dividend aristocrats vs dividend kings is a matter of 25 years versus 50 years of increased dividend payments to investors.

Image source: The Motley Fool.

2021 Dividend Kings

Only 31 stocks qualified as Dividend Kings in 2021:

Company Sector Consecutive Years of Dividend Increases
American States Water (NYSE:AWR) Utilities 67 
Dover Corporation (NYSE:DOV)  Industrials 66 
Emerson Electric (NYSE:EMR) Industrials 65 
Northwest Natural Holding (NYSE:NWN) Utilities 65 
Genuine Parts (NYSE:GPC) Consumer cyclical 65 
Procter & Gamble (NYSE:PG)  Consumer defensive 65 
Parker Hannifin (NYSE:PH) Industrials 65 
3M (NYSE:MMM) Industrials 63 
Cincinnati Financial (NASDAQ:CINF) Financial services 61 
Johnson & Johnson (NYSE:JNJ) Healthcare 59 
Coca-Cola (NYSE:KO) Consumer defensive 59 
Lowe's (NYSE:LOW)  Consumer cyclical 59 
Lancaster Colony (NASDAQ:LANC) Consumer defensive 58 
Colgate-Palmolive (NYSE:CL) Consumer defensive 58
Nordson (NASDAQ:NDSN) Industrials 58 
Farmers & Merchants Bancorp (OTC:FMCB) Financial services 56 
Hormel Foods (NYSE:HRL) Consumer defensive 55 
California Water Service Corp. (NYSE:CWT) Utilities 54 
Stanley Black & Decker (NYSE:SWK) Industrials 54 
Federal Realty Investment Trust (NYSE:FRT) Real estate 54 
ABM Industries (NYSE:ABM) Industrials 53 
Stepan (NYSE:SCL) Basic materials 53 
SJW Group (NYSE:SJW) Utilities 53 
Commerce Bancshares (NASDAQ:CBSH) Financial services 53 
Sysco (NYSE:SYY) Consumer defensive 52 
H.B. Fuller (NYSE:FUL) Basic materials 52 
Altria Group (NYSE:MO) Consumer defensive 51 
Grainger (NYSE:GWW) Industrials 50
Leggett & Platt (NYSE:LEG) Consumer cyclical 50 
PPG Industries (NYSE:PPG) Materials 50 
Target (NYSE:TGT) Consumer defensive 50 

Data sources: Company press releases, Yahoo! Finance.

Two sectors — consumer defensive and industrials — each have eight stocks on the 2021 Dividend Kings list. There were also four utility stocks in the group. This shouldn't be a surprise. Companies in these sectors tend to pay dividends, and many of them have been in operation for a long time.

There aren't any exchange-traded funds (ETFs) that focus exclusively on Dividend Kings. However, the ProShares S&P 500 Dividend Aristocrats ETF (NYSEMKT:NOBL) owns shares of all Dividend Aristocrats. Since Dividend Kings are also Dividend Aristocrats, investing in this ETF would allow you to buy most of the Dividend Kings in one fell swoop (plus a lot of other stocks with great track records of dividend increases.)

Potential changes for 2022

It's likely that all the Dividend Kings in 2021 will remain on the list in 2022. Why? There's a tremendous amount of pressure on companies that have increased their dividends for 50-plus years to keep their streak going. No CEO wants to be known as the leader to mess up an impressive dividend track record.

However, there could be new companies on the Dividend Kings list in 2022. Here are four companies that were just shy of 50 consecutive years of dividend increases in 2021:

Company Sector Consecutive Years of Dividend Increases
Abbott Laboratories (NYSE:ABT) Healthcare 49 
AbbVie (NYSE:ABBV) Healthcare 49 
Becton, Dickinson & Co. (NYSE:BDX) Healthcare 49 
PepsiCo (NASDAQ:PEP) Consumer staples 49 

Data sources: Company press releases, Yahoo! Finance.

Of course, there's no guarantee that these four companies will join the ranks of the Dividend Kings. However, the same factors incentivizing the current Dividend Kings to continue increasing their dividends are incentivizing the companies close to making the cut.

Likely winners in 2022

There are two key factors that should affect many stocks in 2022, including several of the Dividend Kings:

  • Turning the corner on the COVID-19 pandemic
  • Continued low interest rates

These factors could benefit some stocks but hurt others. Here are five Dividend Kings that should be winners in 2022:

Johnson & Johnson

Johnson & Johnson (NYSE:JNJ) might not just benefit from the world turning the corner on the COVID-19 pandemic; the healthcare giant could be key to making it happen. J&J ranks among the leaders in the coronavirus vaccine market and is the biggest of all of the vaccine stocks.

The company committed to selling its COVID-19 vaccine at cost during the pandemic. However, J&J has several other pharmaceutical products on the market that are driving its profits higher. Autoimmune disease drugs Stelara and Tremfya and blood cancer drugs Darzalex and Imbruvica continue to be especially big winners. 

In addition, Johnson & Johnson's multibillion-dollar medical device segment should see its revenue rise as the pandemic subsides. This business was hurt in 2020 because many people put off nonurgent surgical procedures.

Federal Realty Investment Trust

Federal Realty Investment Trust (NYSE:FRT) seems like a surefire winner if COVID-19 cases fall significantly in 2022. The real estate investment trust (REIT) owns more than 100 retail properties.

The company's tenants should be stronger financially as coronavirus concerns fade. That will improve the prospects for Federal Realty in collecting a higher percentage of the recurring rents that it's owed.

Federal Realty should also benefit from sustained low interest rates. REITs usually have to borrow money to fund the addition of new properties. When interest rates are low, it reduces the interest expenses these companies must pay.

Sysco

Sysco (NYSE:SYY) was the kind of stock many investors wanted to avoid during the worst part of the COVID-19 pandemic. Many of Sysco's restaurant customers have been hit hard by the pandemic, resulting in the company's sales declining in 2020 and 2021.

However, a stock to avoid during a pandemic could be a stock that soars when the coronavirus crisis subsides. Sysco should be poised for a solid recovery if Americans return to past levels of dining out in 2022.

The company just might find that its customer base is more loyal than ever before when the pandemic is over. Sysco has worked hard to help its restaurant customers navigate the coronavirus challenge, including by helping them extend their outdoor dining season and revise their menus to boost profitability.

Lowe's

Home-improvement retail giant Lowe's (NYSE:LOW) performed quite well during the worst of the COVID-19 pandemic in 2020. The company's sales and profits soared as many Americans embarked on home-improvement projects.

Lowe's has kept the momentum going in 2021. It expects to boost sales going into 2022 with its transition to a delivery model where large, bulky products are shipped directly to customers' homes from distribution centers, bypassing Lowe's stores altogether.

The company is likely to continue benefiting from low interest rates. As long as rates remain low, home sales should be strong. People who buy new homes often have to fix up their old homes first, which could translate to more business for Lowe's.

Stanley Black & Decker

The same trends that are helping Lowe's are also working to the advantage of Stanley Black & Decker (NYSE:SWK). The company's sales of tools used in do-it-yourself (DIY) projects skyrocketed during the pandemic.

Also like Lowe's, Stanley Black & Decker's tool sales for the DIY market should continue to grow as long as interest rates remain low. Many Americans who start to make repairs to their existing homes in anticipation of buying new ones will need tools for these efforts.

Stanley Black & Decker's other businesses have also bounced back after being hit hard by lockdowns during the pandemic. The company should experience increased growth with its acquisition of MTD Holdings, which makes outdoor power equipment.

Why invest in Dividend Kings?

Dividend Kings aren't necessarily a good fit for every investor. Many of these stocks frequently deliver relatively low growth. For example, three of the five Dividend Kings with the longest records of dividend increases underperformed the S&P 500 over the past 10 years.

However, Dividend Kings can be a great component of retirement portfolios. Most of these stocks offer dividend yields that are higher than the average dividend yield of S&P 500 members. Their consistency in paying and increasing dividend payouts also can provide a measure of confidence for retirees, depending on income generated by the dividend stocks they own.