The 10 Most Recession-Proof Dividend Aristocrats

#6 – Consolidated Edison

• 2007 through 2009 total return of 10.5% (versus -15.9% for the S&P 500)
• 2007 through 2009 maximum drawdown of 30.9% (versus 55.2% for the S&P 500)

Consolidated Edison, Inc. (NYSE:ED) is viewed as a safety stock – and for good reason. The company generated extremely stable cash flows from its heavily regulated gas and electric utilities businesses in New York, New Jersey, and Pennsylvania. Consolidated Edison provides gas utility services for over 3 million customers, and electric utility services for over 1 million customers.

The company’s earnings-per-share and dividends-per-share through the Great Recession of 2007 to 2009 are shown below:

• 2007 earnings-per-share of $3.48 & dividends-per-share of $2.32
• 2008 earnings-per-share of $3.36 & dividends-per-share of $2.34
• 2009 earnings-per-share of $3.14 & dividends-per-share of $2.36

Earnings recovered to $3.47 a share the following year. Throughout the Great Recession, Consolidated Edison’s dividend payments were never in any doubt. At its worst, the company had a 75% payout ratio. Earnings-per-share fell just 9.8% through the worst of the Great Recession.

Consolidated Edison, Inc. (NYSE:ED) currently has earnings-per-share of $3.77 a share and pays dividends of $2.60 a share. This gives the company a payout ratio of 69%. If earnings-per-share were to decline 10% (about as much as they did during the Great Recession), the company would still have a payout ratio of 76.6%.

Investors looking for steady, consistent dividends should look no further than Consolidated Edison. It is highly unlikely that the company reduces its dividend payments – even if we enter into a full global recession.

Relevant stats for Consolidated Edison, Inc. (NYSE:ED) are shown below:

• Dividend yield of 4.2%
• Price-to-earnings ratio of 16.5
• 10 year dividend growth rate of 1.5%