If you are currently investing for dividends, passive income, or have any plans to begin dividend investment then you should sit down and familiarize yourself with the Dividend Aristocrats. No, these are not cats that pay dividends nor are they snobby men that hand out money, it is an index of stocks that have something in common: they pay dividends, they do it consistently, and they consistently increase the payout.
To be more specific, the companies on this list have paid dividends for the last 25 years, they have raised their dividends for the past 25 years and at no point have they suspended or decreased payout. If you are wondering why this list is so important then you first need to understand the concept of yield on cost.
Yield On Cost
In short, your yield will continue to grow on your original cost of investment. If you buy a stock for $10.00 today with a dividend of 30 cents a year, then you fast forward 10 years and the dividend is now at 90 cents! A measly 3% dividend yield is now at a more beefy 9% yield on cost! Who wouldn’t love to have a savings account yielding 9%? Good luck finding it, but investing this way is pretty close risk-wise.
Dividend Aristocrats Index List 2010
So what stocks are in this magical little index? This Dividend Aristocrats Index 2010 list is current as of August 2010. Please view below:
|Air Products & Chemicals Inc||APD|
|Automatic Data Processing||ADP|
|Bard, C.R. Inc||BCR|
|Becton, Dickinson & Co||BDX|
|Bemis Co Inc||BMS|
|Brown-Forman Corp B||BF/B|
|Cincinnati Financial Corp||CINF|
|Consolidated Edison Inc||ED|
|Emerson Electric Co||EMR|
|Exxon Mobil Corp||XOM|
|Family Dollar Stores Inc||FDO|
|Grainger, W.W. Inc||GWW|
|Integrys Energy Group Inc||TEG|
|Johnson & Johnson||JNJ|
|Leggett & Platt||LEG|
|Lilly, Eli & Co||LLY|
|Lowe’s Cos Inc||LOW|
|McGraw-Hill Cos Inc||MHP|
|PPG Industries Inc||PPG|
|Pitney Bowes Inc||PBI|
|Procter & Gamble||PG|
|Stanley Black & Decker||SWK|
There are quite a few household names on that list. That is because, generally, companies that can afford to consistently payout and raise dividends are well-managed, well-established businesses. Many of them have pioneered their industry or become the dominant force. Throughout the next couple of months we are going to slowly be building up a series about this particular index. You will be able to look forward to a more in-depth analysis on some of the companies that are listed as we continue forward.
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