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Dividend Champs Off the Beaten Track

These eight little-known firms have raised dividends annually for at least the past 20 years. 

When you think of mighty dividend payers, some big names instantly come to mind: Coca-Cola, Johnson & Johnson and McDonald’s, to name a few. These firms are so-called Dividend Aristocrats, members of Standard & Poor’s 500-stock index that have boosted their payouts every year for at least the past quarter-century.

But the list of dividend-raisers goes well beyond household names. In fact, even among the Aristocrats, there are companies whose names you might not recognize. “A lot of them probably get overlooked because they’re just sort of boring,” says Sam Stovall, chief equity strategist for S&P Capital IQ’s stock research group. Plenty of firms outside the S&P 500 have also regularly increased dividends for a decade or more.

The following eight stocks boast yields that are close to or more than the S&P 500’s 2.0% yield. Each of the companies has raised its dividend every year for the past 23 years or more. The outlook for their businesses is bright, increasing the likelihood that the companies will boost their dividends for years to come. Prices and related data are through September 5. Price earnings ratios are based on estimated year-ahead profits.

Headquarters: Downers Grove, Ill.
Share price: $88
Market capitalization: $14.7 billion
Price-earnings ratio: 17
Dividend yield: 1.8%
Dividend streak: 59 years

Dover produces industrial components that consumers rarely encounter, such as oil-and-gas drilling equipment and plastic tube connectors. But this diversified manufacturer is worth getting to know.
Anthony Glass Doors 200px

Dover Corp. makes refrigeration equipment among other things.

Case in point: Despite the global economy’s uneven growth so far in 2014, Dover’s sales are improving. Orders for the firm’s four main segments—energy, engineered systems, fluids, and refrigeration and food equipment—have been strong, climbing by an average of 8% in the first six months of 2014 from the same period the year before. “Dover’s results stand out,” writes Nicholas Heymann, an analyst at William Blair, a Chicago-based investment bank.

Meanwhile, the company continues to raise its dividend at a healthy clip. Over the past five years, the payout has moved up at an annualized rate of 9%. Dover’s stock trades at 17 times estimated year-ahead earnings, a slight premium to the average industrial-stock P/E of 16. But analysts expect Dover’s earnings to rise 12% next year, compared with 9% for its average competitor.

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This page is excepted from an article in the November 2014 issue of Kipplinger’s Personal Finance. Download the complete article here.