Printed on February twentieth, 2025 by Bob Ciura
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The Dividend Aristocrats are a choose group of 69 S&P 500 shares with 25+ years of consecutive dividend will increase.
The necessities to be a Dividend Aristocrat are:
- Be within the S&P 500
- Have 25+ consecutive years of dividend will increase
- Meet sure minimal measurement & liquidity necessities
There are presently 69 Dividend Aristocrats.
You’ll be able to obtain an Excel spreadsheet of all 69 Dividend Aristocrats (with metrics that matter similar to dividend yields and price-to-earnings ratios) by clicking the hyperlink beneath:
Disclaimer: Certain Dividend is just not affiliated with S&P World in any approach. S&P World owns and maintains The Dividend Aristocrats Index. The knowledge on this article and downloadable spreadsheet relies on Certain Dividend’s personal overview, abstract, and evaluation of the S&P 500 Dividend Aristocrats ETF (NOBL) and different sources, and is supposed to assist particular person buyers higher perceive this ETF and the index upon which it’s based mostly. Not one of the data on this article or spreadsheet is official knowledge from S&P World. Seek the advice of S&P World for official data.
Nevertheless, even Dividend Aristocrats can fall from grace. For instance, Walgreens Boots Alliance (WBA) was faraway from the Dividend Aristocrats listing in 2024.
The corporate slashed its dividend resulting from a pronounced enterprise downturn within the brick-and-mortar pharmacy retail trade, amid elevated aggressive threats from on-line pharmacies.
This was after Walgreens Boots Alliance had maintained a 40+ 12 months streak of consecutive dividend will increase.
Whereas dividend cuts from Dividend Aristocrats are surprising, they’ve occurred–and will occur once more. To be clear, the next 3 Dividend Aristocrats will not be presently in jeopardy of reducing their dividends.
Their dividend payouts are supported with ample underlying earnings (for now). If their earnings stay secure or proceed to develop, they’ve not less than an honest change of constant their dividend progress.
However, the three Dividend Aristocrats beneath are going through elementary challenges to various levels, and presently obtain our lowest Dividend Threat Scores of C, D, or F.
This text will present an in depth evaluation on the three Dividend Aristocrats most in peril of a future dividend lower.
Desk of Contents
Crimson Flag Dividend Aristocrat For 2025: Fastenal Co. (FAST)
- Dividend Threat Rating: C
- Dividend Yield: 2.3%
Fastenal started in 1967 when Bob Kierlin and 4 pals pooled collectively $30,000 to open the primary retailer. The unique intent was to dispense nuts and bolts by way of merchandising machine, however that concept acquired off the bottom after 20 years.
The corporate went public in 1987 and right now offers fasteners, instruments and provides to its clients by way of 1,597 public branches, 2,031 energetic Onsite places and over 126,900 managed stock gadgets.
In mid-January, Fastenal reported (1/17/25) outcomes for the fourth quarter of fiscal 2024. It grew its web gross sales 4% over the prior 12 months’s quarter because of progress in Onsite places whereas costs remained flat. Earnings-per-share remained flat at $0.46, lacking the analysts’ consensus by $0.02.
One cause for stagnant earnings is that the corporate’s margins have steadily declined over the previous two years.
Supply: Investor Presentation
Fastenal’s earnings-per-share are anticipated to extend in 2025, however the firm’s dividend payout has elevated sooner than its earnings in recent times.
In consequence, the payout ratio is anticipated to succeed in 80% in 2025. This can be a dangerously excessive degree that doesn’t go away a lot monetary wiggle room. If earnings unexpectedly declined, resulting from a recession or another excuse, the dividend payout could possibly be in peril.
Click on right here to obtain our most up-to-date Certain Evaluation report on FAST (preview of web page 1 of three proven beneath):
Crimson Flag Dividend Aristocrat For 2025: Amcor plc (AMCR)
- Dividend Threat Rating: F
- Dividend Yield: 5.0%
Amcor plc is among the world’s most outstanding designers and producers of packaging for meals, pharmaceutical, medical, and different client merchandise. The corporate emphasizes making accountable packaging that’s light-weight, recyclable, and reusable.
Right this moment, the Amcor plc, which trades on the NYSE, was fashioned in June 2019 with the merger between two packaging corporations, U.S-based Bemis Co. Inc. and Australia-based Amcor Ltd. Amcor plc’s present headquarters is in Bristol, U.Okay.
The present dividend yield is engaging in comparison with the broader market, however the payout ratio is excessive at almost 70% anticipated for 2025.
As a packaging producer, Amcor is especially uncovered to the worldwide financial system. It could be troublesome for the corporate to keep up its dividend in a steep recession in consequence. AMCR inventory receives our lowest Dividend Threat Rating of ‘F’.
Click on right here to obtain our most up-to-date Certain Evaluation report on AMCR (preview of web page 1 of three proven beneath):
Crimson Flag Dividend Aristocrat For 2025: Franklin Sources (BEN)
- Dividend Threat Rating: C
- Dividend Yield: 6.1%
Franklin Sources is an funding administration firm. It was based in 1947. Right this moment, Franklin Sources manages the Franklin and Templeton households of mutual funds.
On January thirty first, 2025, Franklin Sources reported web earnings of $163.6 million, or $0.29 per diluted share, for the primary fiscal quarter ending December 31, 2024.
This marked a major enchancment from the earlier quarter’s web lack of $84.7 million, although EPS remained decrease than the $251.3 million web earnings recorded in the identical quarter final 12 months.
Supply: Investor presentation
The previous few years have been troublesome for Franklin Sources. Franklin Sources was gradual to adapt to the altering surroundings within the asset administration trade.
The explosive progress in exchange-traded funds and indexing investing stunned conventional mutual funds.
ETFs have develop into extremely popular with buyers due largely to their decrease charges than conventional mutual funds. In response, the asset administration trade has needed to lower charges and commissions or threat shedding shopper belongings.
Earnings-per-share are anticipated to say no in 2025 in consequence. The corporate nonetheless maintains a manageable payout ratio of 51% anticipated for 2025, but when EPS continues to say no, the dividend payout could possibly be in peril down the highway.
Click on right here to obtain our most up-to-date Certain Evaluation report on BEN (preview of web page 1 of three proven beneath):
Last Ideas
The Dividend Aristocrats are among the many finest dividend progress shares out there.
And whereas most Dividend Aristocrats will proceed to boost their dividends every year, there could possibly be some that find yourself reducing their payouts.
Whereas it’s uncommon, buyers have seen a number of Dividend Aristocrats lower their dividends over the previous a number of years, together with Walgreens Boots Alliance, 3M Firm (MMM), V.F. Corp. (VFC), and AT&T Inc. (T).
Whereas the three Dividend Aristocrats offered right here have been profitable elevating their dividends every year so far, all of them face various ranges of challenges to their underlying companies.
For that reason, earnings buyers ought to view the three purple flag Dividend Aristocrats on this article cautiously going ahead.
Further Studying
Moreover, the next Certain Dividend databases comprise essentially the most dependable dividend growers in our funding universe:
For those who’re on the lookout for shares with distinctive dividend traits, take into account the next Certain Dividend databases:
Thanks for studying this text. Please ship any suggestions, corrections, or inquiries to [email protected].
