Dividend Kings List: Top 15

3. Northwest Natural Holding Company (NYSE:NWN)

Dividend Yield as of December 3: 4.51%

Northwest Natural Holding Company (NYSE:NWN) is a natural gas distribution company that offers a wide range of related products and services to its consumers. The company recently revealed that it had reached a $425 million agreement, including cash and assumed debt, to acquire a gas utility operating in the Texas Triangle region. It made this announcement on November 18, and since then, the stock has surged by over 3%. Its year-to-date returns came in at over 8%.

Northwest Natural Holding Company (NYSE:NWN)’s third-quarter revenue came in at $137 million, surpassing analysts’ estimates by $4.47 million. The company’s net income for the quarter came in at $34 million. Over the past 12 months, it increased its gas and water utility connections by nearly 17,000, achieving a combined growth rate of 1.9% as of September 30, 2024, largely fueled by successful water acquisitions. Palm Valley Capital Management made the following comment about NWN in its Q1 2024 investor letter:

“During the quarter, we purchased Northwest Natural Holding Company (NYSE:NWN). Founded in 1859, NW Natural is a natural gas utility operating in Oregon and Washington. While the company targets long-term earnings growth of 4%-6%, earnings per share in 2024 are expected to decline by 7% to 15%. Earnings are being pressured by above average investments in the utility’s infrastructure and higher than expected inflation. In response, management filed for a rate increase with regulators in December 2023, which would provide the utility with a 10.1% return on equity. If approved, new rates are expected to go into effect in November and should move earnings in 2025 closer to our normalized estimate of $2.80/share. NW Natural is currently trading at 13x our normalized EPS estimate and 1.2x tangible book value—both near historical lows. The firm has increased its dividend for 68 years in a row, and the stock offers a 5.3% yield. While there remains uncertainty related to regulatory decisions and interest rates, at its current price, we believe we’re being adequately compensated for risk assumed.”

Northwest Natural Holding Company (NYSE:NWN) has been generating solid cash this year. In the first nine months of 2024, the company reported an operating cash flow of nearly $220 million. It ended the quarter with over 35 million available in cash and cash equivalents. The company holds one of the longest dividend growth streaks in the market, having raised its dividends by 69 years in a row. Currently, it pays a quarterly dividend of $0.49 per share and has a dividend yield of 4.5%, as of December 3.

As of the close of Q3 2024, 14 hedge funds in Insider Monkey’s database owned stakes in Northwest Natural Holding Company (NYSE:NWN), up from 11 in the previous quarter. These stakes are valued at over $62.7 million.