by Serkan Unal
Dividend stocks are one of the best investment options for patient investors. These stocks can protect investors from potential inflation, and when reinvested, dividends present tremendous growth opportunities with the power of compounding. Dividend aristocrats with their long-term growth stories are attractive alternatives for defensive investors. The S&P 500 Dividend Aristocrats includes only companies which have increased dividends every year for at least 25 years.
With this in mind, I compiled a list of 4 dividend aristocrats that have dividend yields of higher than 3%, P/E ratios of lower than 17, payout ratios of lower than 60%, and whose EPS grew by over 6% annually during the past five years. I obtained 10-year summary data from Morningstar and all other market data from Finviz.
Abbott Laboratories (ABT)
Drug Manufacturers - Major
Emerson Electric (EMR)
Industrial Equipment & Components
Genuine Parts (GPC)
Auto Parts Wholesale
Abbott Laboratories provides health care products worldwide. ABT expects to complete the spin off its pharmaceuticals unit into a separate publicly traded company by January 1, 2013. The company has a long term competitive advantage with its gross margin of 62.7% and net profit margin of 16.6%. ABT recently traded at $64.61 and has a 3.2% dividend yield. ABT gained 22.2% during the past 12 months. The stock has a market cap of $99.6 billion, P/E ratio of 15.5 and Total Debt/Equity ratio of 0.74. ABT also had an EPS growth rate of 22% during the last five years.
Emerson Electric is a diversified technology company operating worldwide. EMR recently traded at $50.43 and has a 3.2% dividend yield. EMR recently increased its quarterly dividend by 2.5% to $0.41 per share. EMR gained 1% during the past 12 months. The stock has a market cap of $36.2 billion, P/E ratio of 15.2 and Total Debt/Equity ratio of 0.56. EMR also had an EPS growth rate of 7.9% during the last five years.
Genuine Parts sells replacement parts for passenger vehicles and industrial machines. GPC recently traded at $62.16 and has a 3.2% dividend yield. GPC gained 9.7% during the past 12 months. The stock has a market cap of $9.6 billion, P/E ratio of 15.5 and Total Debt/Equity ratio of 0.16. GPC also had an EPS growth rate of 5.4% during the last five years.
McDonald's Corporation franchises and operates McDonald's restaurants in the global restaurant industry. MCD recently traded at $84.71 and has a 3.6% dividend yield. MCD lost 7.3% during the past 12 months. The stock has a market cap of $85.5 billion, P/E ratio of 16 and Total Debt/Equity ratio of 0. MCD also had an EPS growth rate of 18.1% during the last five years.