In this article, we discuss top 25 dividend challengers by yield. You can skip our detailed analysis of dividend stocks and their performance over the years, and go directly to read Dividend Challengers List Ranked By Yield: Top 10.
Dividend Challengers are companies that have raised their dividends for five years or more. These companies tend to have strong financials and are often viewed as more mature than non-dividend-paying companies. Moreover, they are likely to continue growing their payouts in the future and can be a reliable investment option for risk-averse investors. Examples of popular dividend stocks that have rewarded investors with decades-long dividend growth include The Procter & Gamble Company (NYSE:PG), Johnson & Johnson (NYSE:JNJ), and A. O. Smith Corporation (NYSE:AOS).
With the growing risks of a global recession, dividend stocks are taking the spotlight as these securities have helped investors through previous periods of economic decline. According to a report by Charles Schwab, high-dividend stocks outperformed the overall market in every recessionary bear market of the past 50 years, except for the financial crisis of 2008-2009, when companies were made to slash their payouts. The same report also highlighted the importance of diversified portfolios, with securities scattered through various sectors.
When evaluating dividend stocks, investors should be aware of some potential risks so that they can make more informed investment decisions. Companies with relatively high payout ratios are more vulnerable to a dividend cut. On the other hand, companies that have consistently raised their dividends have solid cash flow generation, which makes them more committed to shareholder obligation. As many companies showed confidence in their sufficient cash flow, dividend spending is likely to increase this year as well. In 2022, companies in the S&P 500 distributed approximately $561 billion in dividends, reaching their highest amount on record. Given the above discussion, we will further elaborate on Dividend Challengers in this article.
Photo by Marga Santoso on Unsplash
Our Methodology:
For this list, we selected stocks from the list of Dividend Challengers, the companies that have raised their payouts for consecutive five years or more. From that list, we selected stocks that have the highest dividend yields. We also measured the hedge fund sentiment around each stock using Insider Monkey’s database of 920 hedge funds for the third quarter of 2022. The stocks are ranked in ascending order of their dividend yields, as of February 3.
Dividend Challengers List Ranked By Yield: Top 25
25. Best Buy Co., Inc. (NYSE:BBY)
Dividend Yield as of February 3: 3.90%
Best Buy Co., Inc. (NYSE:BBY) is an American consumer electronics company that is based in Minnesota. The company currently pays a quarterly dividend of $0.88 per share and has a dividend yield of 3.90%, as of February 3. The company maintains a 9-year streak of consistent dividend growth. It is among the best dividend stocks on our list due to its strong dividend policy.
In addition to popular dividend stocks like The Procter & Gamble Company (NYSE:PG), Johnson & Johnson (NYSE:JNJ), and A. O. Smith Corporation (NYSE:AOS), analysts are also positive about BBY’s future dividend growth.
Credit Suisse appreciated the improving gross margins of Best Buy Co., Inc. (NYSE:BBY) in December and initiated its coverage on the stock with a Neutral rating and a $90 price target.
Best Buy Co., Inc. (NYSE:BBY) was a part of 31 hedge fund portfolios in Q3 2022, growing from 26 in the previous quarter, as per Insider Monkey’s data. The stakes owned by these funds have a total value of $296.8 million. With over 1.3 million shares, Citadel Investment Group was the company’s leading stakeholder in Q3.
24. NextEra Energy Partners, LP (NYSE:NEP)
Dividend Yield as of February 3: 4.37%
NextEra Energy Partners, LP (NYSE:NEP) is a Florida-based renewable energy company that acquires and manages clean energy projects. On February 2, the company declared a 3.2% hike in its quarterly dividend to $0.8125 per share. This was the company’s ninth consecutive year of dividend growth, which makes it one of the best dividend stocks on our list. The stock’s dividend yield on February 3 came in at 4.37%.
In Q4 2022, NextEra Energy Partners, LP (NYSE:NEP) reported revenue of $266 million, which showed a 14.7% growth from the same period last year. The company also grew its distributions per unit by 15% year-over-year.
In January, Oppenheimer raised its price target on NextEra Energy Partners, LP (NYSE:NEP) to $94 with an Outperform rating on the shares. The firm appreciated the company’s dividend per share growth estimates over the next three years.
At the end of Q3 2022, 21 hedge funds in Insider Monkey’s database owned stakes in NextEra Energy Partners, LP (NYSE:NEP), up from 17 in the previous quarter. These stakes have a total value of roughly $250 million.
23. VICI Properties Inc. (NYSE:VICI)
Dividend Yield as of February 3: 4.50%
VICI Properties Inc. (NYSE:VICI) is an American real estate investment trust company that invests in casino properties. Deutsche Bank raised its price target on the stock to $38 in December with a Buy rating on the shares, appreciating the company’s recent acquisitions.
On December 8, VICI Properties Inc. (NYSE:VICI) declared a quarterly dividend of $0.39 per share, which fell in line with its previous dividend. The company started its dividend policy in 2018 and has raised its payouts every year since then. The stock has a dividend yield of 4.50%, as of February 3.
The number of hedge funds tracked by Insider Monkey owning stakes in VICI Properties Inc. (NYSE:VICI) grew to 33 in Q3 2022, from 26 in the previous quarter. These stakes have a consolidated value of $307.8 million. Among these hedge funds, AEW Capital Management was the company’s leading stakeholder in Q3.
Meridian Funds mentioned VICI Properties Inc. (NYSE:VICI) in its Q2 2022 investor letter. Here is what the firm has to say:
“VICI Properties Inc. (NYSE:VICI) is a real estate investment trust company specializing in casinos and other entertainment properties. We invested in VICI in 2018 when earnings were declining due to dilutive acquisitions. Our thesis was that, as investors grew more comfortable with casinos as a REIT subsector, the value of their properties would increase. We also liked the defensive characteristics of the company, specifically the triple-net lease structure, which dictates that lessees pay all maintenance and capital expenditures, and the history of casino REITs with zero rent payments missed by casinos during either the global financial crisis or the 2020 pandemic. Furthermore, we were confident that VICI’s growth prospects would increase as more casinos monetized land holdings with VICI’s ability to use its extensive cash and liquidity to make acquisitions. VICI’s stock outperformed in the quarter due to its appeal as a fairly defensive investment and the news that it would be included in the S&P 500 Index. We maintained our position in VICI.”
22. LCNB Corp. (NASDAQ:LCNB)
Dividend Yield as of February 3: 4.54%
LCNB Corp. (NASDAQ:LCNB) is a holding company of LCNB National Bank that provides commercial, banking, and other related services in Ohio, US. At the end of December 31, the company’s total assets amounted to nearly $2 billion, up from $1.9 billion from a year ago period. In Q4, it generated nearly $20 million in revenues, up from 6.3% in the same period last year.
LCNB Corp. (NASDAQ:LCNB) is one of the best dividend stocks on our list as the company has raised its dividend at a CAGR of 5.7% since 2018. Moreover, the company has been raising its dividends consistently for the past 5 years. It currently pays a quarterly dividend of $0.21 per share and has a dividend yield of 4.54%, as of February 3.
At the end of September 2022, 5 hedge funds tracked by Insider Monkey reported owning stakes in LCNB Corp. (NASDAQ:LCNB), up from 4 in the previous quarter. These stakes have a consolidated value of nearly $5.7 million.
21. Midland States Bancorp, Inc. (NASDAQ:MSBI)
Dividend Yield as of February 3: 4.54%
Midland States Bancorp, Inc. (NASDAQ:MSBI) is an American bank holding company that provides commercial and personal banking services to its consumers. In Q4 2022, the company reported revenue of $97.3 million, which showed a 26.8% growth from the same period last year. At the end of December 31, it had $150.3 million available in cash and cash equivalents and its total assets amounted to $7.8 billion.
Midland States Bancorp, Inc. (NASDAQ:MSBI), one of the best dividend stocks, currently pays a quarterly dividend of $0.29 per share and has a dividend yield of 4.54%, as of February 3. The company has been raising its dividends consistently for the past 22 years.
Midland States Bancorp, Inc. (NASDAQ:MSBI) was a part of 10 hedge fund portfolios at the end of Q3 2022, according to Insider Monkey’s data. The stakes owned by these hedge funds have a total value of over $9.3 million. Two Sigma Advisors was one of the company’s leading stakeholders in Q3.
20. Cousins Properties Incorporated (NYSE:CUZ)
Dividend Yield as of February 3: 4.71%
Cousins Properties Incorporated (NYSE:CUZ) is a Georgia-based real estate investment trust company that mainly invests in office buildings. In December, Barclays maintained an Overweight rating on the stock with a $36 price target. The firm mentioned that the company is well-positioned to benefit from favorable migration trends.
Cousins Properties Incorporated (NYSE:CUZ) currently pays a quarterly dividend of $0.32 per share and has a dividend yield of 4.71%, as of February 3.
As of the close of Q3 2022, 15 hedge funds in Insider Monkey’s database owned stakes in Cousins Properties Incorporated (NYSE:CUZ), compared with 16 in the previous quarter. These stakes have a total value of over $51 million. Among these hedge funds, Citadel Investment Group was the company’s leading stakeholder in Q3.
19. Farmers National Banc Corp. (NASDAQ:FMNB)
Dividend Yield as of February 3: 4.75%
An Ohio-based bank holding company, Farmers National Banc Corp. (NASDAQ:FMNB) is another best dividend stock on our list. In its fourth quarter, the company posted revenue of $37.6 million, up 315.5% from the same period last year. It also reported loan growth of $5.2 million for the quarter.
In December, Piper Sandler raised its price target on Farmers National Banc Corp. (NASDAQ:FMNB) to $16 and maintained a Neutral rating on the shares.
On November 22, Farmers National Banc Corp. (NASDAQ:FMNB) declared a 6% growth in its quarterly dividend to $0.17 per share. This was the company’s eighth consecutive year of dividend growth, which places it as one of the best dividend stocks on our list. The stock has a dividend yield of 4.75%, as of February 3.
As per Insider Monkey’s Q3 2022 database, 13 hedge funds owned stakes in Farmers National Banc Corp. (NASDAQ:FMNB), up from 10 in the previous quarter. The collective value of these stakes is over $13.5 million.
18. Intel Corporation (NASDAQ:INTC)
Dividend Yield as of February 3: 5.02%
Intel Corporation (NASDAQ:INTC) is a California-based multinational tech company that mainly specializes in cloud computing and data centers. On January 26, the company declared a quarterly dividend of $0.365 per share, consistent with its previous dividend. It maintains a seven-year streak of consistent dividend growth.
In Q4 2022, Intel Corporation (NASDAQ:INTC) reported revenue of $14 billion, which fell by 28.2% from the same period last year. The company generated $7.7 billion in operating cash flow and returned $1.5 billion to shareholders in dividends. Its commitment to shareholders makes it one of the best dividend stocks on our list.
As of the end of the September quarter, 69 hedge funds owned stakes in Intel Corporation (NASDAQ:INTC), up from 65 in the previous quarter. These stakes have a total value of roughly $2 billion. With over 15 million shares, Two Sigma Advisors was one of the company’s leading stakeholders in Q3.
ClearBridge Investments mentioned Intel Corporation (NASDAQ:INTC) in its Q3 2022 investor letter. Here is what the firm has to say:
“Also on the detractor side, Intel Corporation (NASDAQ:INTC) delivered a disappointing revenue miss and lowered full-year revenue and earnings guidance as COVID-19-driven demand for PCs abated (where Intel enjoys half its sales) and a delay in its flagship Sapphire Rapids CPU hurt its data center business. Despite these issues, we still believe Intel is an economically sensitive turnaround story with substantial upside.”
17. STORE Capital Corporation (NYSE:STOR)
Dividend Yield as of February 3: 5.09%
STORE Capital Corporation (NYSE:STOR) is an American real estate investment trust company that provides net lease solutions to middle market estate capital. The company pays a quarterly dividend of $0.41 per share. In 2022, it extended its dividend growth streak to six years. The stock’s dividend yield on February 3 came in at 5.09%.
In the third quarter of 2022, STORE Capital Corporation (NYSE:STOR) reported revenue of $230.5 million, up 15.8% from the same period last year. During the quarter, it paid nearly $116 million in dividends to shareholders, which makes it one of the best dividend stocks on our list.
STORE Capital Corporation (NYSE:STOR) was a popular stock among hedge funds in Q3 2022, as 34 funds tracked by Insider Monkey reported having stakes in the company, up from 22 a quarter earlier. These stakes have a collective value of $606.7 million.
16. Peoples Bancorp Inc. (NASDAQ:PEBO)
Dividend Yield as of February 3: 5.13%
Peoples Bancorp Inc. (NASDAQ:PEBO) is an American bank holding company, based in Ohio. In its recently announced Q4 earnings, the company posted revenue of $89.6 million, which showed a 20.3% growth from the prior-year period. At the end of December 31, it had over $154 million available in cash and cash equivalents.
On January 24, Peoples Bancorp Inc. (NASDAQ:PEBO) declared a quarterly dividend of $0.38 per share, which fell in line with its previous dividend. The company maintains an eight-year streak of consistent dividend growth. As of February 3, the stock has a dividend yield of 5.13%.
At the end of September 2022, 13 hedge funds in Insider Monkey’s database owned stakes in Peoples Bancorp Inc. (NASDAQ:PEBO), up from 12 in the previous quarter. The collective value of these stakes is over $20.3 million. Elizabeth Park Capital Management was the company’s leading stakeholder in Q3.
15. Taitron Components Incorporated (NASDAQ:TAIT)
Dividend Yield as of February 3: 5.14%
Taitron Components Incorporated (NASDAQ:TAIT) is a California-based manufacturing company that specializes in electronic components. The company currently pays a quarterly dividend of $0.05 per share and has a dividend yield of 5.14%, as of February 3. In 2022, it raised its dividends for the fifth consecutive year, coming through as one of the best dividend stocks on our list.
At the end of Q3 2022, only one hedge fund owned a stake in Taitron Components Incorporated (NASDAQ:TAIT), worth nearly $1.3 million.
14. Community Healthcare Trust Incorporated (NYSE:CHCT)
Dividend Yield as of February 3: 5.18%
Community Healthcare Trust Incorporated (NYSE:CHCT) is an American self-managed healthcare real estate investment trust company that finances properties that are leased to hospitals and other healthcare facilities. In October 2022, the company raised its quarterly dividend to $0.445 per share for a dividend yield of 5.18%, as of February 3. It maintains a 7-year streak of consistent dividend growth.
Community Healthcare Trust Incorporated (NYSE:CHCT) gained positive ratings from Street analysts in the current inflationary environment. In January, both Truist and Piper Sandler raised their price targets on the stock to $48 and $45, respectively.
At the end of Q3 2022, 8 hedge funds tracked by Insider Monkey reported having stakes in Community Healthcare Trust Incorporated (NYSE:CHCT), worth $34.2 million collectively.
13. Kilroy Realty Corporation (NYSE:KRC)
Dividend Yield as of February 3: 5.27%
Kilroy Realty Corporation (NYSE:KRC) is a California-based real estate investment trust company that engages in the acquisition of office properties located in the US. In Q4 2022, the company reported revenue of $284.3 million, which showed an 8.9% growth from the same period last year. At the end of December, it had over $347.3 million available in cash and cash equivalents and its total assets stood at $10.8 billion.
In January, Mizuho maintained a Buy rating on Kilroy Realty Corporation (NYSE:KRC) with a $48 price target, as the firm sees a more balanced risk/reward for the REIT sector.
On December 7, Kilroy Realty Corporation (NYSE:KRC) declared a quarterly dividend of $0.54 per share, consistent with its previous dividend. The company is one of the best dividend stocks on our list as it has been raising its payouts for the past seven years. As of February 3, the company’s shares have a yield of 5.27%.
As per Insider Monkey’s Q3 2022 database, 23 hedge funds owned investments in Kilroy Realty Corporation (NYSE:KRC), the same as in the previous quarter. These investments are worth $422.3 million collectively. Paul Tudor Jones and Jim Simons are some of the company’s leading stakeholders in Q3.
12. CareTrust REIT, Inc. (NYSE:CTRE)
Dividend Yield as of February 3: 5.33%
CareTrust REIT, Inc. (NYSE:CTRE) specializes in the acquisition, development, and leasing of skilled nursing and other healthcare facilities. The company pays a quarterly dividend of $0.275 per share and has a dividend yield of 5.33%, as of February 3. It has been rewarding shareholders with increased dividends for the past seven years consistently.
In October, Barclays presented a positive stance on the healthcare services sector, expecting a sequential improvement in EBITDA across the industry. Given this, the firm maintained an Equal Weight rating on the shares.
As of the close of Q3 2022, 14 hedge funds tracked by Insider Monkey owned stakes in CareTrust REIT, Inc. (NYSE:CTRE), compared with 15 a quarter earlier. These stakes have a total value of $45.5 million.
11. National Storage Affiliates Trust (NYSE:NSA)
Dividend Yield as of February 3: 5.37%
National Storage Affiliates Trust (NYSE:NSA) is a Colorado-based REIT that invests in high-quality self-storage facilities located within high-growth markets. The company started paying dividends in 2015 and has raised its payouts multiple times since then. It currently pays a quarterly dividend of $0.55 per share and has a dividend yield of 5.37%, as of February 3.
National Storage Affiliates Trust (NYSE:NSA) can be added to dividend portfolios due to its consistent dividend payments alongside some of the best dividend stocks like The Procter & Gamble Company (NYSE:PG), Johnson & Johnson (NYSE:JNJ), and A. O. Smith Corporation (NYSE:AOS).
At the end of Q3 2022, National Storage Affiliates Trust (NYSE:NSA) was a part of 23 hedge fund portfolios, compared with 28 in the previous quarter. The stakes owned by these funds have a total value of over $220 million.
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Disclosure. None. Dividend Challengers List Ranked By Yield: Top 25 is originally published on Insider Monkey.