8 Best Dividend Kings To Invest In For Safe Dividend Growth

3. Parker-Hannifin Corporation (NYSE:PH)

5-Year Average Annual Dividend Growth Rate: 13.38%

Parker-Hannifin Corporation (NYSE:PH) is an American manufacturing company that specializes in motion and control technologies. The company has experienced significant growth, with its stock rising by more than 232% over the past five years, significantly outperforming the broader market’s 96% increase. The company is also recognized for its strong dividend payouts and impressive cash flow generation. For fiscal 2024, it reported a 20% increase in year-to-date operating cash flow, reaching a record $2.1 billion, which represents 14.6% of sales, up from $1.8 billion in the prior-year period. The company also achieved notable improvements in adjusted segment operating margins, with the Aerospace Systems Segment delivering exceptional performance. This solid financial performance has led to record operating cash flow. Moving forward, the company expects a 50% increase in free cash flow and plans to double its dividend over the next five years, providing shareholders with larger payouts each year, which is expected to have a positive impact on the stock’s value.

Diamond Hill Capital highlighted PH in its Q3 2024 investor letter. Here is what the firm has to say:

“Other top Q3 contributors included Parker-Hannifin Corporation (NYSE:PH) and Ciena Corporation. Diversified industrial and aerospace manufacturer Parker-Hannifin is capitalizing on strength in its aerospace business to drive better-than-expected results against a challenging macroeconomic backdrop that has weighed on peers’ results.”

Parker-Hannifin Corporation (NYSE:PH) reported strong earnings in the third quarter, despite challenges in the industrial sector. The company reached a milestone with nearly $20 billion in sales, a record adjusted segment operating margin that saw a 200 basis point improvement from the previous year, and an 18% increase in adjusted earnings per share. It also generated a record $3 billion in free cash flow. With a strong outlook for fiscal year 2025, the company is well-positioned to achieve its financial goals for fiscal year 2029.

Parker-Hannifin Corporation (NYSE:PH), one of the best dividend kings, has been growing its dividends for 68 consecutive years. The company’s 5-year average annual dividend growth rate comes in at 13.38%. It currently offers a quarterly dividend of $1.63 per share and has a dividend yield of 0.95%, as of December 9.

Insider Monkey’s database of Q3 2024 indicated that 62 hedge funds owned stakes in Parker-Hannifin Corporation (NYSE:PH), down from 67 in the previous quarter. The consolidated value of these stakes is more than $2.22 billion.