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These ‘Dividend Aristocrat’ stocks have been raising their dividends for decades, and there have been no dividend cuts during the pandemic

In a yr of a lot uncertainty, having a little bit of surety about your investments is a luxurious.

The S&P 500 Dividend Aristocrats — stocks of 65 corporations that have elevated their dividends for no less than 25 years — have been stable, in that none of them have minimize their payouts.

You is perhaps considering: Isn’t that what they’re presupposed to do? Yes. But when you take a look at the elements of the benchmark S&P 500 Index
SPX,
+0.36%,
63 corporations have minimize or suspended their dividends this yr. That’s 14% of the non-Aristocrats. They are listed under, and the year-to-date returns are ugly. Of 63 dividend cutters, 56 have suffered double-digit declines (with dividends reinvested), and 49 are down no less than 20%.

Among the 65 elements of the S&P 500 Dividend Aristocrats Index
SP50DIV,
+0.08%,
gainers and decliners are just about evenly cut up for 2020, with 33 exhibiting optimistic returns by means of Aug. 21.

The whole  S&P 500 Dividend Aristocrats Index is down 2.4% this yr, which can appear a poor exhibiting in opposition to the 6.5% return for the broader S&P 500 Index. However, massive know-how corporations that dominate the benchmark index have had an outsized impact on its market-capitalization-weighted efficiency.

In the U.S. monetary media, “big tech” just about means the FAANG stocks and Microsoft Corp.
MSFT,
+1.30%.
This group is on fireplace this yr and carries an incredible weighting in the S&P 500, however solely two of them are in the data know-how sector, as outlined by S&P Dow Jones Indices:

Company Ticker Total return – 2020 Market capitalization ($ billion)
Facebook Inc. Class A FB,
+3.47%
30% $642
Apple Inc. AAPL,
-0.82%
71% $2,127
Amazon.com Inc. AMZN,
+1.18%
78% $1,645
Netflix Inc. NFLX,
+0.36%
52% $217
Alphabet Inc. Class C GOOG,
+1.26%
18% $527
Alphabet Inc. Class A GOOGL,
+1.30%
18% $473
Microsoft Corp. MSFT,
+1.30%
36% $1,612
Source: FactSet

Together, the FAANG + Microsoft group’s mixed $7.24 trillion in market capitalization makes up 25.8% of the cap-weighted S&P 500. So, no, your index fund shouldn’t be as diversified as you might suppose.

So it’s no shock that the tech-heavy S&P 500 has been outperforming the S&P 500 Dividend Aristocrats for a few years. But when you look again 15 years, the story modifications:

Over 15 years, the S&P 500 Dividend Aristocrats Index has crushed the efficiency of the full S&P 500 Index.

FactSet

One solution to spend money on the whole Aristocrats group is the ProShares S&P 500 Dividend Aristocrats
NOBL,
-0.42%.

The Dividend Aristocrats record

An S&P 500 inventory is taken into account a Dividend Aristocrat if it has raised its dividend payout on widespread shares for no less than 25 consecutive years. It makes no distinction how excessive a inventory’s present dividend yield is perhaps. S&P Dow Jones Indices will embrace a newly shaped firm as a Dividend Aristocrat if it was shaped by means of a merger that included an organization that was already an Aristocrat and it continues raising its dividend.

Here are all 65 S&P 500 Dividend Aristocrats, sorted by present yield, with complete returns for 2020 by means of Aug. 21 (scroll the desk to the proper to see the yields and returns):

Company Ticker Industry Dividend yield Total return – 2020
Exxon Mobil Corp. XOM,
-3.17%
Integrated Oil 8.49% -38%
AT&T Inc. T,
-0.43%
Telecommunications 7.01% -20%
People’s United Financial Inc. PBCT,
+0.18%
Banks 6.89% -36%
Chevron Corp. CVX,
-1.22%
Integrated Oil 6.06% -27%
Federal Realty Investment Trust FRT,
-0.20%
Real Estate Investment Trusts 5.28% -36%
Franklin Resources Inc. BEN,
-0.51%
Investment Managers 5.15% -17%
AbbVie Inc. ABBV,
-0.47%
Pharmaceuticals: Major 4.98% 11%
Walgreens Boots Alliance Inc. WBA,
-0.60%
Drugstore Chains 4.74% -31%
Realty Income Corp. O,
+0.20%
Real Estate Investment Trusts 4.58% -15%
Consolidated Edison Inc. ED,
-1.76%
Electric Utilities 4.24% -18%
Amcor PLC AMCR, Containers/Packaging 4.14% 5%
Leggett & Platt Inc. LEG,
-0.34%
Home Furnishings 4.02% -20%
Essex Property Trust Inc. ESS,
+0.41%
Real Estate Investment Trusts 3.90% -28%
Cardinal Health Inc. CAH,
+1.52%
Medical Distributors 3.90% 0%
3M Co. MMM,
-0.26%
Industrial Conglomerates 3.64% -6%
Nucor Corp. NUE,
-0.97%
Steel 3.60% -19%
Coca-Cola Co. KO,
-0.12%
Beverages: Non-Alcoholic 3.47% -13%
Genuine Parts Co. GPC,
-0.51%
Wholesale Distributors 3.39% -11%
Archer-Daniels-Midland Co. ADM,
-0.33%
Agricultural Commodities/Milling 3.30% -3%
Raytheon Technologies Corp. RTX,
-1.50%
Aerospace & Defense 3.15% -30%
Sysco Corp. SYY,
-2.20%
Food Distributors 3.13% -31%
V.F. Corp. VFC,
-2.33%
Apparel/Footwear 3.11% -37%
Cincinnati Financial Corp. CINF,
-0.21%
Property/Casualty Insurance 3.10% -25%
Aflac Inc. AFL,
-0.74%
Life/Health Insurance 3.08% -30%
PepsiCo Inc. PEP,
-0.24%
Beverages: Non-Alcoholic 3.00% 1%
Caterpillar Inc. CAT,
-0.37%
Trucks/Construction/Farm Machinery 2.98% -4%
Emerson Electric Co. EMR,
+0.18%
Electrical Products 2.95% -9%
General Dynamics Corp. GD,
-1.19%
Aerospace & Defense 2.94% -13%
Kimberly-Clark Corp. KMB,
-0.87%
Household/Personal Care 2.72% 16%
T. Rowe Price Group TROW,
-0.13%
Investment Managers 2.67% 12%
Johnson & Johnson JNJ,
-0.05%
Pharmaceuticals: Major 2.64% 6%
Automatic Data Processing Inc. ADP,
+0.28%
Data Processing Services 2.64% -18%
Chubb Limited CB,
+1.19%
Property/Casualty Insurance 2.56% -21%
McDonald’s Corp. MCD,
+0.01%
Restaurants 2.36% 8%
Medtronic PLC MDT,
+2.45%
Medical Specialties 2.35% -12%
Illinois Tool Works Inc. ITW,
+0.05%
Industrial Machinery 2.34% 10%
Procter & Gamble Co. PG,
+0.39%
Household/Personal Care 2.30% 12%
Atmos Energy Corp. ATO,
-1.44%
Gas Distributors 2.28% -8%
Colgate-Palmolive Co. CL,
-0.68%
Household/Personal Care 2.24% 16%
Clorox Co. CLX,
-1.77%
Household/Personal Care 1.96% 50%
A. O. Smith Corp. AOS,
-0.42%
Building Products 1.96% 4%
Air Products and Chemicals Inc. APD,
+0.61%
Chemicals: Specialty 1.87% 23%
PPG Industries Inc. PPG,
-1.04%
Industrial Specialties 1.83% -10%
Dover Corp. DOV,
+0.18%
Oilfield Services/Equipment 1.80% -4%
Target Corp. TGT,
-0.25%
Specialty Stores 1.77% 22%
Hormel Foods Corp. HRL,
-2.09%
Food: Meat/Fish/Dairy 1.77% 19%
Stanley Black & Decker Inc. SWK,
-0.41%
Tools & Hardware 1.76% -3%
W.W. Grainger Inc. GWW,
+1.58%
Wholesale Distributors 1.74% 6%
Albemarle Corp. ALB,
-0.96%
Chemicals: Specialty 1.72% 24%
Pentair PLC PNR,
-0.84%
Miscellaneous Manufacturing 1.65% 2%
Walmart Inc. WMT,
-0.53%
Food Retail 1.64% 12%
Linde PLC LIN,
+0.47%
Chemicals: Specialty 1.58% 16%
Abbott Laboratories ABT,
+1.06%
Medical Specialties 1.41% 19%
Lowe’s Cos. Inc. LOW,
+0.17%
Home Improvement Chains 1.36% 37%
Otis Worldwide Corp. OTIS,
+0.76%
Building Products 1.26% N/A
Becton, Dickinson and Co. BDX,
+0.32%
Medical Specialties 1.23% -5%
McCormick & Co. Inc. MKC,
-0.03%
Food: Specialty/Candy 1.22% 21%
Expeditors International of Washington Inc. EXPD,
+0.34%
Air Freight/Couriers 1.21% 11%
Carrier Global Corp. CARR,
+0.29%
Industrial Machinery 1.08% N/A
Brown-Forman Corp. Class B BF.B,
-0.48%
Beverages: Alcoholic 0.97% 7%
Ecolab Inc. ECL,
-0.77%
Chemicals: Specialty 0.96% 1%
Cintas Corp. CTAS,
-0.19%
Other Consumer Services 0.80% 19%
Sherwin-Williams Co. SHW,
-0.16%
Industrial Specialties 0.79% 17%
S&P Global Inc. SPGI,
-0.23%
Financial Publishing/Services 0.74% 33%
Roper Technologies Inc. ROP,
-0.20%
Electronic Equipment/Instruments 0.47% 22%
Source: FactSet

You can click on on the tickers for extra about every firm.

Despite no dividend cuts amongst the group this yr, they’re a risk. For instance, Exxon Mobil Corp.
XOM,
-3.17%
determined in April to go away its quarterly dividend (paid in May) unchanged, when it historically raises the dividend at the moment every year. Unless the firm makes a transfer later this yr, it won’t longer be an Aristocrat.

Dividend cuts for Exxon and Chevron Corp.
CVX,
-1.22%
have historically appeared “virtually unthinkable,” as Raymond James analyst Pavel Molchanov mentioned in March. Sure sufficient, Exxon has proven an actual dedication to sustaining the present payout by taking drastic measures to protect money during the prolonged interval of low gas demand. These measures embrace a suspension of matching 401(ok) contributions for its staff.

So it is advisable to do your individual analysis earlier than contemplating a Dividend Aristocrat, or some other firm, for funding.

Dividend cutters

Here are all 63 corporations amongst the S&P 500 that have suspended or lowered their dividend funds this yr. This record is sorted by ascending complete returns. Current dividend yields are included:

Company Ticker Total return – 2020 Dividend yield
Carnival Corp. CCL,
-1.54%
-71% 0.00%
Occidental Petroleum Corp. OXY,
-0.80%
-66% 0.30%
Coty Inc. Class A COTY,
-1.75%
-66% 0.00%
TechnipFMC PLC FTI,
-1.89%
-64% 1.74%
Nordstrom Inc. JWN,
-0.19%
-64% 0.00%
Kohl’s Corp. KSS,
+1.12%
-61% 0.00%
Macy’s Inc. M,
-0.60%
-61% 0.00%
Marathon Oil Corp. MRO,
+0.73%
-61% 0.00%
Alliance Data Systems Corp. ADS,
+0.83%
-61% 1.94%
Helmerich & Payne Inc. HP,
-3.44%
-60% 5.92%
Noble Energy Inc. NBL,
-1.35%
-59% 0.80%
American Airlines Group Inc. AAL,
-2.23%
-57% 0.00%
Simon Property Group Inc. SPG,
+0.21%
-55% 8.06%
Wells Fargo & Co. WFC,
+0.49%
-55% 1.69%
Royal Caribbean Group RCL,
-0.55%
-53% 0.00%
Delta Air Lines Inc. DAL,
+1.00%
-53% 0.00%
Schlumberger NV SLB,
-1.48%
-53% 2.69%
National Oilwell Varco Inc. NOV,
-0.41%
-53% 0.00%
PVH Corp. PVH,
+0.93%
-52% 0.00%
DXC Technology Co. DXC,
+1.42%
-50% 0.00%
Boeing Co. BA,
-1.98%
-48% 0.00%
Alaska Air Group Inc. ALK,
+0.50%
-47% 0.00%
Western Digital Corp. WDC,
-0.66%
-46% 0.00%
Tapestry Inc. TPR,
-2.54%
-45% 0.00%
Vornado Realty Trust VNO,
+0.40%
-44% 5.98%
Apache Corp. APA,
+1.34%
-44% 0.70%
Kimco Realty Corp. KIM,
-0.25%
-43% 0.00%
Ralph Lauren Corp. Class A RL,
-1.60%
-42% 0.00%
Host Hotels & Resorts Inc. HST,
+1.89%
-42% 0.00%
Invesco Ltd. IVZ,
+0.94%
-41% 6.11%
Wynn Resorts Ltd. WYNN,
-0.66%
-40% 0.00%
Capital One Financial Corp. COF,
-0.66%
-37% 0.63%
Marriott International Inc. Class A MAR,
+0.89%
-37% 0.00%
MGM Resorts International MGM,
-0.80%
-36% 0.05%
Southwest Airlines Co. LUV,
+0.40%
-35% 0.00%
Halliburton Co. HAL,
-0.85%
-35% 1.14%
WestRock Co. WRK,
-2.20%
-32% 2.81%
Molson Coors Beverage Co. Class B TAP,
-1.05%
-31% 0.00%
Welltower Inc. WELL,
+0.29%
-29% 4.35%
Las Vegas Sands Corp. LVS,
+0.30%
-28% 0.00%
Ford Motor Co. F,
-0.57%
-27% 0.00%
CenterPoint Energy Inc. CNP,
-1.03%
-25% 3.03%
Ventas Inc. VTR,
-1.93%
-25% 4.32%
Ross Stores Inc. ROST,
+2.17%
-25% 0.00%
Harley-Davidson Inc. HOG,
-2.04%
-25% 0.29%
Universal Health Services Inc. Class B UHS,
-1.24%
-24% 0.00%
Darden Restaurants Inc. DRI,
-0.32%
-24% 0.00%
Hilton Worldwide Holdings Inc. HLT,
+0.04%
-21% 0.00%
General Motors Co. GM,
-2.04%
-21% 0.00%
Gap Inc. GPS,
+10.38%
-17% 0.00%
Expedia Group Inc. EXPE,
+1.00%
-15% 0.00%
TJX Cos. TJX,
-0.46%
-15% 0.00%
CME Group Inc. Class A CME,
-0.16%
-13% 1.96%
Walt Disney Co. DIS,
-0.68%
-12% 0.00%
Aptiv PLC APTV,
-0.16%
-11% 0.00%
HCA Healthcare Inc. HCA,
-0.20%
-10% 0.00%
Weyerhaeuser Co. WY,
-0.20%
-3% 0.00%
Estee Lauder Cos. Inc. Class A EL,
+1.34%
0% 0.93%
Freeport-McMoRan Inc. FCX,
-0.68%
10% 0.00%
Maxim Integrated Products Inc. MXIM,
+2.48%
13% 0.00%
Progressive Corp. PGR,
+0.83%
31% 0.44%
Rollins Inc. ROL,
-1.01%
67% 0.58%
L Brands Inc. LB,
+3.34%
68% 0.00%
Source: FactSet

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