In this article, we will be looking at 10 stocks with over 10 years of dividend increases. If you want to skip our detailed analysis of these companies and dividend investing, you can go directly to the 5 Stocks with Over 10 Years of Dividend Increases.
While some investors may prefer investing in bonds instead of stocks, particularly during times of market volatility and financial instability, the importance of dividend-paying stocks can never be understated. According to Ave Maria Funds, for instance, between 1970 to 2021, the S&P 500’s growth of $1,000 with dividends was a total of $193,630, of which $150,441 was contributed solely by dividends. As for the question of their performance in times of economic volatility, Global X Management Company LLC has estimated that since 1960, during the 10 time periods of increasing interest rates, dividend stocks, and particularly high-yielding dividend stocks, were able to outperform the market by an annualized average of 0.80%.
With the above in mind, investing in dividend stocks has managed to remain a prevalent practice with many investors gravitating towards dividend-yielders because of their attractive returns and the possibility of setting up a reliable income stream to get them through times of financial distress. Moreover, the fact that dividends were responsible for generating about a third of the total return for the S&P 500 since 1926 means that having a sustainable income from dividends is an important consideration for total return expectations. As such, dividend stocks with attractive yields and reliable payout histories like Microsoft Corporation (NASDAQ: MSFT), Mastercard Incorporated (NYSE: MA), UnitedHealth Group Incorporated (NYSE: UNH), and Merck & Co., Inc. (NYSE: MRK) can be considered good investment options in financially difficult circumstances.
Investing is becoming difficult by the day, even for the smart money. The entire hedge fund industry is feeling the reverberations of the changing financial landscape. Its reputation has been tarnished in the last decade, during which its hedged returns couldn’t keep up with the unhedged returns of the market indices. On the other hand, Insider Monkey’s research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 124 percentage points since March 2017. Between March 2017 and February 26th 2021 our monthly newsletter’s stock picks returned 197.2%, vs. 72.4% for the SPY. Our stock picks outperformed the market by more than 124 percentage points (see the details here). We were also able to identify in advance a select group of hedge fund holdings that significantly underperformed the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 13% through November 16th. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to. You can subscribe to our free newsletter on our homepage to receive our stories in your inbox.
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Let’s now look at the 10 stocks with over 10 years of dividend increases. The stocks selected for our list below were chosen on the basis of their fundamentals and growth potential based on core business strengths. We also took into account analysts’ ratings and hedge fund sentiment to pick out the stocks most popular among the hedge funds tracked by Insider Monkey. They have been thus ranked from the lowest to the highest number of hedge fund holders.
Stocks with Over 10 Years of Dividend Increases
10. QUALCOMM Incorporated (NASDAQ: QCOM)
Number of Hedge Fund Holders: 73
Number of Years of Consecutive Dividend Increases: 19
Dividend Yield: 1.9%
QUALCOMM Incorporated (NASDAQ: QCOM) is a leading tech company that develops technology for use in mobile devices and wireless products. The company also invests in start-ups in the AI, automotive, digital healthcare, enterprise, IoT, mobile, and networking industries. It ranks 10th on our list of stocks with over 10 years of dividend increases.
This July, Rod Hall from Goldman Sachs upgraded QUALCOMM Incorporated (NASDAQ: QCOM) shares from Sell to Neutral with a $148 price target, raised from $136. Hall commented that QUALCOMM Incorporated (NASDAQ: QCOM) may benefit from the early iPhone launch and an improvement in the supply situation in the latter half of 2021.
In the fiscal second quarter of 2021, QUALCOMM Incorporated (NASDAQ: QCOM) had an EPS of $1.90, beating estimates by $0.23. The company’s revenue was $7.92 billion, up 52.23% year over year and also beating estimates by $304.53 million. QUALCOMM Incorporated (NASDAQ: QCOM) has gained about 53.53% in the past year as well.
By the end of the first quarter of 2021, 73 hedge funds out of the 866 tracked by Insider Monkey held stakes in QUALCOMM Incorporated (NASDAQ: QCOM) worth roughly $2.76 billion. This is compared to 85 hedge funds in the previous quarter with stakes worth approximately $2.72 billion.
Like Microsoft Corporation (NASDAQ: MSFT), Mastercard Incorporated (NYSE: MA), UnitedHealth Group Incorporated (NYSE: UNH), and Merck & Co., Inc. (NYSE: MRK), QUALCOMM Incorporated (NASDAQ: QCOM) is a good dividend stock to invest in.
ClearBridge Investments, an investment management firm, mentioned QUALCOMM Incorporated (NASDAQ: QCOM) in its first-quarter 2021 investor letter. Here’s what they said:
“Within IT, we have also increased exposure to a cyclical semiconductor industry currently working through a severe supply shortage due to several years of capacity reductions, COVID-19 shutdowns and one-off production delays as well as demand resilience in areas like autos and smartphones. The main risk for semiconductors is short-term revenue pressure until capacity catches up with demand, which hurt wireless chipmaker Qualcomm. Looking past current constraints, we expect the industry to see a strong second half and solid growth in 2022.”
9. Union Pacific Corporation (NYSE: UNP)
Number of Hedge Fund Holders: 75
Number of Years of Consecutive Dividend Increases: 15
Dividend Yield: 1.9%
Union Pacific Corporation (NYSE: UNP) is a company operating in the railroads industry in the US and offers transportation services for grain and grain products, fertilizers, food and refrigerated products, and coal and renewables. It ranks 9th on our list of stocks with over 10 years of dividend increases.
Loop Capital’s Rick Paterson upgraded Union Pacific Corporation (NYSE: UNP) shares from Hold to Buy just this July, with a $269 price target set on the company’s shares.
In the first quarter of 2021, Union Pacific Corporation (NYSE: UNP) had an EPS of $2.00, missing estimates by $0.05. The company’s revenue was $5.00 billion, also missing estimates by $11.72 million. Union Pacific Corporation (NYSE: UNP) has however gained about 4.86% in the past 6 months and 6.98% year to date as well.
By the end of the first quarter of 2021, 75 hedge funds out of the 866 tracked by Insider Monkey held stakes in Union Pacific Corporation (NYSE: UNP) worth roughly $4.68 billion. This is compared to 68 hedge funds in the previous quarter with stakes worth approximately $3.53 billion.
Like Microsoft Corporation (NASDAQ: MSFT), Mastercard Incorporated (NYSE: MA), UnitedHealth Group Incorporated (NYSE: UNH), and Merck & Co., Inc. (NYSE: MRK), Union Pacific Corporation (NYSE: UNP) is a good dividend stock to invest in.
Vltava Fund, an investment management firm, mentioned Union Pacific Corporation (NYSE: UNP) in its first-quarter 2021 investor letter. Here’s what they said:
“There was a slight change in Vltava Fund’s portfolio in the first quarter. We sold shares of Union Pacific. It was one of three stocks we bought a year ago at the market bottom. Although from a P/E viewpoint this was one of our most expensive purchases ever, the shares worked out quite well, and, when they were more than 90% higher at the beginning of this year, we decided to take profit and put the money into stocks with more attractive valuations.”
8. Activision Blizzard, Inc. (NASDAQ: ATVI)
Number of Hedge Fund Holders: 76
Number of Years of Consecutive Dividend Increases: 10+
Dividend Yield: 0.5%
Activision Blizzard, Inc. (NASDAQ: ATVI) is a communication services company operating in the interactive home entertainment industry to develop entertainment content. The company’s content is for video game consoles, computers, and mobile devices, and it also operates an online gaming service called Battle.net. It ranks 8th on our list of stocks with over 10 years of dividend increases.
This July, Berenberg’s Jamie Bass, while covering Activision Blizzard, Inc. (NASDAQ: ATVI), raised his price target on the company’s shares to $110, keeping a Buy rating on the stock.
In the first quarter of 2021, Activision Blizzard, Inc. (NASDAQ: ATVI) had an EPS of $0.84, beating estimates by $0.15. The company’s revenue was $2.07 billion, up 35.74% year over year and also beating estimates by $285.55 million. Activision Blizzard, Inc. (NASDAQ: ATVI) has gained about 12.42% in the past year as well.
By the end of the first quarter of 2021, 76 hedge funds out of the 866 tracked by Insider Monkey held stakes in Activision Blizzard, Inc. (NASDAQ: ATVI) worth roughly $3.58 billion. This is compared to 81 hedge funds in the previous quarter with stakes worth approximately $3.73 billion.
Like Microsoft Corporation (NASDAQ: MSFT), Mastercard Incorporated (NYSE: MA), UnitedHealth Group Incorporated (NYSE: UNH), and Merck & Co., Inc. (NYSE: MRK), Activision Blizzard, Inc. (NASDAQ: ATVI) is a good dividend stock to invest in.
7. NIKE, Inc. (NYSE: NKE)
Number of Hedge Fund Holders: 78
Number of Years of Consecutive Dividend Increases: 20
Dividend Yield: 0.7%
NIKE, Inc. (NYSE: NKE) is a footwear manufacturer and seller that provides athletic footwear, alongside apparel and other equipment, across the world. Its Converse, Chuck Tayler, All Star, and Jordan brands are among the best athletic footwear and apparel brands in the world, and it ranks 7th on our list of stocks with over 10 years of dividend increases.
In July, John Staszak from Argus raised his price target on NIKE, Inc. (NYSE: NKE) shares to $182, commenting that he expects the company’s Jordan brand to lead it as it comprises over 12% of NIKE, Inc.’s (NYSE: NKE) sales. Staszak kept a Buy rating on the stock as well.
In the fiscal fourth quarter of 2021, NIKE, Inc. (NYSE: NKE) had an EPS of $0.93, beating estimates by $0.42. The company’s revenue was $12.34 billion, up 95.53% year over year and also beating estimates by $1.32 billion. NIKE, Inc. (NYSE: NKE) has gained about 15.59% in the past 6 months and 14.98% year to date as well.
By the end of the first quarter of 2021, 78 hedge funds out of the 866 tracked by Insider Monkey held stakes in NIKE, Inc. (NYSE: NKE) worth roughly $5.17 billion. This is compared to 82 hedge funds in the previous quarter with stakes worth approximately $6.28 billion.
Like Microsoft Corporation (NASDAQ: MSFT), Mastercard Incorporated (NYSE: MA), UnitedHealth Group Incorporated (NYSE: UNH), and Merck & Co., Inc. (NYSE: MRK), NIKE, Inc. (NYSE: NKE) is a good dividend stock to invest in.
6. Merck & Co., Inc. (NYSE: MRK)
Number of Hedge Fund Holders: 79
Number of Years of Consecutive Dividend Increases: 11
Dividend Yield: 3.3%
Merck & Co., Inc. (NYSE: MRK), a global healthcare company, ranks 6th on our list of stocks with over 10 years of dividend increases. The company is collaborating with AstraZeneca PLC, Bayer AG, and Ridgeback Biotherapeutics, among others, and provides health products in oncology, immunology, neuroscience, virology, among other areas in the medical field.
Mizuho holds a Buy rating on Merck & Co., Inc. (NYSE: MRK) shares alongside a $100 price target as of this July, led by analyst Mara Goldstein.
In the first quarter of 2021, Merck & Co., Inc. (NYSE: MRK) had an EPS of $1.40, higher than the previous quarter’s $1.32 EPS. The company’s revenue was $12.08 billion, up 0.19% year over year but missing estimates by $567.83 million. Merck & Co., Inc. (NYSE: MRK) has gained about 1.69% in the past year.
By the end of the first quarter of 2021, 79 hedge funds out of the 866 tracked by Insider Monkey held stakes in Merck & Co., Inc. (NYSE: MRK) worth roughly $6.49 billion. This is compared to 82 hedge funds in the previous quarter with stakes worth approximately $7.17 billion.
Artisan Partners, a high value-added investment management firm, mentioned Merck & Co., Inc. (NYSE: MRK) in its first-quarter 2021 investor letter. Here’s what they said:
“In Q1, we initiated a position in Merck, a provider of health care solutions including prescription medicines, vaccines, biologic therapies, animal health and consumer care products. We purchased Merck when the stock came under pressure in part on concerns that the newly minted Biden administration could implement regulatory changes and lower drug costs in the pharmaceutical industry. Recent, but anticipated changes to Merck’s management team have also weighed on shares, as have concerns over the company’s heavy reliance on immunotherapy treatment Keytruda. Notably, Merck is not getting much credit from investors for the 60+ programs it has in clinical development, despite having several solid and large new product opportunities. Additionally, the company’s strong balance sheet and robust free cash flow provide it multiple options for future partnerships and acquisitions. While Merck is undergoing a period of transition, we think the company’s fundamentals are strong and believe changes to management should be a catalyst for improvement.”
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Disclosure: None. 10 Stocks with Over 10 Years of Dividend Increases is originally published on Insider Monkey.
