5 Companies Likely to be Dividend Kings in the Future

In this article, we discuss 5 companies likely to be dividend kings in the future. If you want to read our detailed analysis of the returns of dividend growers, go directly to read 10 Companies Likely to be Dividend Kings in the Future. 

5. Brown-Forman Corporation (NYSE:BF-B)

Consecutive Years of Dividend Growth: 39
5-Year Average Dividend Payout Ratio: 39.5%

Brown-Forman Corporation (NYSE:BF-B) is a Kentucky-based company that produces spirits and wines. In fiscal Q2 2023, the company reported revenue of $1.09 billion, which showed a 9.7% growth from the same period last year. At the end of October 2022, it had over $1 billion available in cash and cash equivalents, up from $868 million six months before that.

On January 24, Brown-Forman Corporation (NYSE:BF-B) declared a quarterly dividend of $0.2055 per share, consistent with its previous dividend. The company maintains a 39-year streak of consistent dividend growth and has a dividend yield of 1.25%, as of February 7. With a 5-year average dividend payout ratio of 39.5%, BF-B is likely to be a dividend king in the future.

At the end of September 2022, 36 hedge funds in Insider Monkey’s database owned investments in Brown-Forman Corporation (NYSE:BF-B), up from 28 a quarter earlier. These stakes have a total value of over $1.5 billion. With over 12.2 million shares, Fundsmith LLP was the company’s leading stakeholder.

4. Aflac Incorporated (NYSE:AFL)

Consecutive Years of Dividend Growth: 41
5-Year Average Dividend Payout Ratio: 20.9%

Aflac Incorporated (NYSE:AFL) is a Georgia-based insurance company that provides supplemental insurance to its consumers. On February 1, the company declared a 4.5% hike in its quarterly dividend to $0.42 per share. This marked the company’s 41st consecutive year of dividend growth. The stock’s dividend yield on February 7 came in at 2.39%. It has a solid 5-year average payout ratio of 20.9%.

In the fourth quarter of 2022, Aflac Incorporated (NYSE:AFL) missed Street estimates on various accounts. The company’s revenue for the quarter came in at $4.01 billion and its total investment income stood at $117.4 billion.

As of the close of Q3 2022, 34 hedge funds in Insider Monkey’s database reported owning stakes in Aflac Incorporated (NYSE:AFL), up from 32 in the previous quarter. These stakes are collectively valued at nearly $380 million.

3. Franklin Resources, Inc. (NYSE:BEN)

Consecutive Years of Dividend Growth: 42
5-Year Average Dividend Payout Ratio: 49.6%

Franklin Resources, Inc. (NYSE:BEN) is an American multinational holding company, headquartered in California. In January, BMO Capital maintained a Market Perform rating on the stock, presenting a positive stance on the company’s alternative platform expansion plans.

Franklin Resources, Inc. (NYSE:BEN) is likely to be a dividend king in the future as the company’s 5-year average payout ratio stands at 49.6%. Moreover, it has been raising its dividends consistently for the past 42 years. The company pays a quarterly dividend of $0.30 per share for a dividend yield of 3.74%, as of February 7.

At the end of September, 25 hedge funds in Insider Monkey’s database owned stakes in Franklin Resources, Inc. (NYSE:BEN), up from 24 in the previous quarter. These stakes have a collective value of nearly $126 million.

2. The Sherwin-Williams Company (NYSE:SHW)

Consecutive Years of Dividend Growth: 43
5-Year Average Dividend Payout Ratio: 26.7%

The Sherwin-Williams Company (NYSE:SHW) is an Ohio-based company that specializes in the manufacturing of coating and painting materials. The company offers a quarterly dividend of $0.60 per share and has a dividend yield of 1.01%, as of February 7. With a five-year average dividend payout ratio of 26.7% and a 43-year streak of dividend growth, the company is likely to be a dividend king in the future.

In January, RBC Capital maintained an Outperform rating on The Sherwin-Williams Company (NYSE:SHW) with a $267 price target. The firm mentioned that the company is well-positioned to benefit from ‘carried over volume backlogs’.

At the end of September 2022, 63 hedge funds tracked by Insider Monkey owned stakes in The Sherwin-Williams Company (NYSE:SHW), up from 52 in the previous quarter. The collective value of these stakes is over $2.8 billion.

Baron Funds mentioned The Sherwin-Williams Company (NYSE:SHW) in its Q4 2022 investor letter. Here is what the firm has to say:

“In the most recent quarter, following a more than 40% correction over the course of 2022 in its share price from a high of $348 to $195, we re-acquired shares of The Sherwin-Williams Company (NYSE:SHW).

The company is a global leader in the manufacturing, development, distribution, and sale of paint, coatings, and related products to professional, industrial, commercial, and retail customers. Its well-known brands include Sherwin-Williams, Dutch Boy, Krylon, Minwax, Thompson’s Water Seal, and Valspar.

Sherwin-Williams products are sold exclusively through more than 4,850 company-operated stores and facilities, while the company’s other brands are sold through leading mass merchandisers, home centers, independent paint dealers, hardware stores, automotive retailers, and industrial distributors…” (Click here to read the full text)

1. Pentair plc (NYSE:PNR)

Consecutive Years of Dividend Growth: 47
5-Year Average Dividend Payout Ratio: 35.6%

Pentair plc (NYSE:PNR) is an American water treatment company, based in Minnesota. It mainly provides sustainable water solutions to its consumers. Following the company’s recent quarterly earnings, Loop Capital raised its price target on the stock to $75 in February with a Buy rating on the shares. Mizuho also maintained a Buy rating on PNR.

Pentair plc (NYSE:PNR) pays a quarterly dividend of $0.22 per share, raising it by 4.8% in December 2022. Through this increase, the company extended its dividend growth streak to 47 years. The stock’s dividend yield on February 7 came in at 1.53%. Its five-year average dividend payout ratio stands at 35.6%, which shows that it is likely to be a dividend king in the future.

At the end of Q3 2022, 29 hedge funds tracked by Insider Monkey reported owning stakes in Pentair plc (NYSE:PNR), compared with 31 in the previous quarter. The collective value of these stakes is over $914.3 million. Impax Asset Management was the company’s leading stakeholder in Q3.

You can also take a look at Jim Cramer’s Favorite Energy and Bank Stock Picks and 10 Monthly Dividend Stocks with over 5% Yield

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