Published on 23 Mar 2023 on Insider Monkey via Yahoo Finance
In this article, we discuss 12 future dividend kings in the next 6 years or less. You can skip our detailed analysis of dividend stocks and their returns over the years, and go directly to read 5 Future Dividend Kings in the Next 6 Years or Less.
Dividend Kings are companies that have dividend growth streaks of 50 years or more. Investors are inclined toward these securities as these companies are financially stable and are more likely to raise their payouts in the future. Moreover, these stocks also offer regular income to shareholders along with the potential for capital appreciation as the stock price grows over time. Some of the best dividend kings that investors are paying attention to include The Coca-Cola Company (NYSE:KO), PepsiCo, Inc. (NASDAQ:PEP), and The Procter & Gamble Company (NYSE:PG) as these companies have strong cash flow generation which enabled them to raise their payouts for decades.
The current inflationary environment has enhanced the importance of dividend growers. Analysts also recommend loading up on companies with strong dividend growth track records instead of those with high yields. According to a report by Nuveen, global dividend-payers with modest yields of around 3% generally exhibit better earnings potential and higher profit margins when compared with high-yielding dividend stocks. The report also mentioned that dividend growth stocks outperformed their peers during monthly periods of rising volatility. From December 2002 to December 2022, dividend growers delivered an average excess return of 0.7% when the monthly volatility increase was over 20%.