13 Best Dividend Growth Stocks With 10%+ Yearly Increases

10. Target Corporation (NYSE:TGT)

5-Year Average Annual Dividend Growth Rate: 11.30%

Target Corporation (NYSE:TGT) ranks tenth on our list of the best dividend stocks with steady growth rates. The American retail corporation operates a chain of hypermarkets and discount department stores. In January, the company reaffirmed its focus on wellness by unveiling plans to launch over 2,000 new products across various categories, including more than 600 exclusive to Target. In addition, it is expanding its men’s wellness lineup with fresh offerings, such as Dr. Squatch body care, new additions to Dwayne Johnson’s Papatui men’s care line, and a new men’s fragrance from the vegan brand Fin’ery.

Over the past year, Target Corporation (NYSE:TGT) has steadily increased its operating income while maintaining a solid financial standing. Although its debt remains relatively high, its cash holdings, cash equivalents, and short-term investments are sufficient to cover near-term liabilities. The company’s growing cash reserves, along with an interest coverage ratio of 11.6, further reinforce its financial stability. Moreover, its strong liquidity is backed by a clean balance sheet with no intangible assets and a healthy return on invested capital (ROIC) of 11.5%.

Target Corporation (NYSE:TGT) maintains a strong dividend track record and a solid financial foundation. During the first nine months of 2024, the company generated $4.07 billion in operating cash flow. By the end of the quarter, it held $3.4 billion in cash and cash equivalents. This financial strength allowed the company to distribute $516 million to shareholders in the form of dividends. In the past five years, it has raised its payouts at an annual average rate of 11.3%. Overall, the company maintains a 53-year streak of consistent dividend growth. Its quarterly dividend comes in at $1.12 per share and has a dividend yield of 3.41%, as of February 8.