Investing

Five Dividend Growth Stocks to Buy And Never Sell

Ian Cooper

Published: November 13, 2024 9:10 am

One of the best ways to build wealth is with dividend stocks – especially if they’re attached to solid companies with a strong history of earnings and dividend growth.

With these, it’s best to reinvest the dividends continuously. After all, each reinvested dividend payout buys you more income-producing shares without any out-of-pocket expenses. By doing so, you’re compounding the earnings and expediting the growth of your portfolio.

Here are five top dividend stocks you may want to consider today.

Key Points About This Article

• Protect your portfolio from market volatility with strong dividend stocks.
• With a strong history of dividend growth, here are six hot stocks to buy and hold today.
• Keep your portfolio well-protected with reliably safe stocks with yield. You may also want to grab your free copy of “2 Legendary High-Yield Dividend Stocks“ now.

Philip Morris

With a yield of 4.32%, Philip Morris (NYSE:PM) is well-known as a tobacco company. However, with the number of smokers on the decline, the company has expanded its offerings to include heated tobacco products, vapor and nicotine pouches. All of which are seen as less harmful ways to consume nicotine. Helping, earnings haven’t been too shabby.

In its most recent quarter, the company’s EPS of $1.91 beat estimates by nine cents. Revenue of $9.91 billion, up 8.4% year over year, beat by $220 million. Plus, its fiscal year 2024 guidance range of $6.85 to $6.91 beat estimates of $6.40.

American Water Works

With a yield of 2.27%, American Water Works (NYSE:AWK) is one of the largest publicly traded water utilities in the U.S. And while it’s a boring stock, it does own much-needed water and wastewater systems. Helping, the company just declared a dividend of $0.765 per share, which is payable on December 3 to shareholders of record as of November 12. With earnings, the company’s EPS of $1.80 did miss by five cents. But its revenue of $1.32 billion, up 12.8% year over year, did beat by $90 million.

Kinder Morgan

For one, Kinder Morgan is the biggest natural gas pipeline operator with a 40% market share. Two, KMI could be a strong beneficiary of the artificial intelligence data center energy boom. In fact, as reported by CNBC, “Natural gas is expected to supply 60% of the power demand growth from AI and data centers, while renewables will provide the remaining 40%, according to Goldman Sachs’ report published in April.”

Even better, Goldman Sachs reiterated its conviction buy rating on KMI with a price target of $26. The firm cited KMI’s third-quarter results and its potential to capitalize on natural gas demand as the catalyst for its price target revision.

The company also declared a dividend of $0.2875, which is payable on November 15 to shareholders of record on October 31.

Enbridge

With a dividend yield of 6.15%, Enbridge (NYSE:ENB) is another one of the lower-risk, high-yield dividend stocks to consider in the natural gas sector. The company holds the second-longest natural gas pipeline in the U.S., North America’s longest crude oil pipeline, and a high-growth, renewable power generation business. Recent earnings haven’t been too shabby either.

While its EPS of 39 cents missed by a penny, its revenue of $10.66 billion, up 48% year over year, beat by $5.77 billion. Also, as noted by President and CEO Greg Ebel, “This quarter, we concluded the successful acquisition of the three U.S. natural gas utilities first announced in September 2023. The assets are a perfect fit within Enbridge’s existing low-risk business model, offer reliable cash flow, and come with embedded quick-cycle growth opportunities.”

Schwab US Dividend Equity ETF

There’s also the Schwab US Dividend Equity ETF (NYSE:SCHD). With an expense ratio of 0.06%, the ETF tracks the total return of the Dow Jones U.S. Dividend index. It also yields 3.58% and has holdings in Amgen, AbbVie, Home Depot, Cisco Systems, Broadcom, Chevron, UPS, and Coca-Cola to name just a few. 

ProShares S&P 500 Dividend Aristocrats ETF

We can also look at ProShares S&P 500 Dividend Aristocrats ETF (BATS:NOBL), which carries a yield of 3.453% at the moment.

With an expense ratio of 0.06%, the ETF focuses on the S&P 500 Dividend Aristocrats—high-quality companies that have not just paid dividends but grown them for at least 25 consecutive years, with most doing so for 40 years or more. Some of its top holdings include Caterpillar, Pentair, AbbVie, AFLAC, General Dynamics, Clorox Co., Walmart, Hormel Foods, and dozens more.  All of which have a strong dividend-paying history.