Investing Insights 13 Elite Companies With Fast-Growing Dividends
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May 30, 2025 David Harrell, the Editor of Morningstar’s DividendInvestor newsletter and a dividend investment expert, dives into the secrets behind the coveted Dividend Growers list. He reveals 13 companies with impressive dividend growth, while discussing why some fell short. Harrell emphasizes the long-term benefits of dividend growth investing and the nuances of identifying undervalued stocks. He also touches on the sustainability of double-digit growth in dividends, providing insights for both seasoned and novice investors looking to enhance their portfolios.
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Strict Dividend Growers Criteria
- Only 13 companies met the criteria of 10% dividend growth for five years with a wide or narrow moat and at least 1% yield.
- These firms were chosen for consistent payout growth and strong economic moat as per Morningstar coverage.
Low Yield in Growth Stocks
- Companies with higher dividend yields often pay out a large earnings portion, limiting dividend growth potential.
- The list's average yield was 1.8%, below typical income-seeking investor expectations due to growth focus.
Dividend Growth for Long-Term Investors
- Dividend growers suit investors focused on earnings growth rather than just current income.
- Strong dividend growth reflects rising earnings, potentially boosting stock prices over time.