10 Magnificent Dividend Growth Stocks to Invest In

8. A. O. Smith Corporation (NYSE:AOS)

5-Year Average Dividend Growth Rate: 7.49%

A. O. Smith Corporation (NYSE:AOS) is an American manufacturing company, headquartered in Wisconsin. The company specializes in residential and commercial water heaters for its consumers. It reported mixed Q4 2024 earnings, with revenues amounting to $912.4 million, down 8% from the same period last year. Following three consecutive years of record sales, the company experienced a decline in revenue in 2024, largely attributed to a sluggish economy in China that continued to weigh on consumer demand. Additionally, water heater sales in North America softened in the second half of the year. However, boiler sales in the region saw an 8% increase, driven by strong demand for high-efficiency commercial products.

Despite reporting weak results, A. O. Smith Corporation (NYSE:AOS)’s cash position remained stable in 2024. The company generated $581.8 million in operating cash flow and its free cash flow for the year came in at $473.8 million. It also returned $496 million to shareholders through dividends and share repurchases. At the end of December 31, 2024, the company had approximately $240 million available in cash and cash equivalents.

On January 17, A. O. Smith Corporation (NYSE:AOS) declared a quarterly dividend of $0.34 per share, which was in line with its previous dividend. Overall, the company has raised its dividends for 32 years in a row. Moreover, it has been making uninterrupted dividends to shareholders for 85 years. With a dividend yield of 3.06%, as of March 9, AOS is one of the best dividend aristocrat stocks on our list.