5 Dividend Aristocrat Stocks

Includes: ABT, KO, LLY, MCD, SDY, SPGI
by: Scott's Investments
In a continued effort to expand the focus of my site's screens and hypothetical portfolios, this article is a follow-up to an article written in early April focusing on the S&P 500 Dividend Aristocrats. The S&P 500 Dividend Aristocrats index measures the performance of large cap, blue chip companies within the S&P 500 that have followed a policy of increasing dividends every year for at least 25 consecutive years. The current list has 43 constituents and the entire list is available from S&P or on my site. If an investor's portfolio was large enough he or she could consider purchasing the entire list.
Alternatively, an investor could invest in the SDY, the SPDR Dividend ETF, which is a variation of the Aristocrats - it seeks to replicate the “High Yield” Dividend Aristocrats Index. A third alternative is to start with the Aristocrat list and then reduce the list of candidates through screens and/or fundamental analysis. I screened for Aristocrats which had a sustainable payout ratio, a high dividend yield, relatively low debt/equity ratio, and positive return on assets and equity.

Using Finviz, which has some of the better screeners and charts available, I screened the Aristocrat list for:
  • Payout Ratio < 80%,
  • Dividend Yield > 3%
  • Return on Assets > 10%
  • Return on Equity > 10%
  • Total Debt/Equity < 1
Below is a list of 5 Aristocrats which are worthy of further consideration, especially if one is seeking yield or seeking to reduce exposure to non-dividend paying companies. All of the companies on the list are familiar names and four of the five names were also on last month's list.
MHP is a new addition since its share price has dropped in the past month, driving the yield over 3%.
Ticker Company Free Trend Analysis Forward P/E Dividend Yield Payout Ratio Total Debt / Equity 200-Day SMA Price
ABT Abbott Laboratories Here 10.5 3.61% 47.77% 0.83 -3.59% 48.72
KO The Coca-Cola Company Here 14.05 3.34% 54.40% 0.47 -1.31% 52.67
LLY Eli Lilly & Co. Here 7.71 5.66% 52.87% 0.64 0.79% 34.62
MCD McDonald's Corp. Here 13.85 3.23% 48.79% 0.74 11.21% 68.01
MHP The McGraw-Hill Companies, Inc. Here 10.3 3.10% 37.21% 0.63 -4.73% 30.28

Disclosure: No Positions