10 Dividend Aristocrat stocks expected by analysts to rise up to 54% in 2023

Shares of dividend-growing companies have fared better during this year’s bear market.

Below is a screen showing which stocks among the expanding list of Dividend Aristocrats are analysts’ favorites for next year. Following is a list of Aristocrats with the highest dividend yields.

First, let’s define this group of stocks.

Holding as interest rates rise

S&P 500 Dividend Aristocrats Index XX:SP50DIV
Made up of 63 stocks within the benchmark S&P 500 SPX
Which have raised regular dividends for at least 25 consecutive years. That’s the only requirement – it doesn’t matter how high or low the stock’s current yield is. The index is equally weighted and tracked by the ProShares S&P 500 Dividend Aristocrats ETF NOBL.,

Here’s how the S&P 500 Dividend Aristocrats Index has performed this year against the S&P 500 with dividend reinvestments through December 2:

factset

Investors have taken comfort in the elite during this year’s broad decline for stocks. But the outperformance is also reflected in the index’s long-term returns:

index

3 years

5 years

10 years

15 years

20 years

25 years

30 years

S&P 500 Dividend Aristocrats

11.5%

11.4%

13.4%

11.5%

11.5%

10.2%

11.45%

S&P 500

11.2%

11.0%

13.3%

9.2%

9.8%

7.9%

9.91%

Source: FactSet

The S&P 500 Dividend Aristocrats Index has outperformed the S&P 500 for all periods on the table. But the largest outperformance has been for periods of 15 years or more, factoring in the financial crisis of 2008–2009 and/or the reversal of the dot-com bubble in the two years through October 2002.

Investing in NOBL is an easy way to keep up with this group, but you may also be interested in individual elites for long-term growth or income investing.

Dividend Aristocrats: Analysts’ Favorites for 2023

For a broad screen of Dividend Aristocrat stocks, we expanded our pool of companies by looking at two other Aristocrat indexes created by the S&P Dow Jones Indices:

  • The S&P 400 Dividend Aristocrats Index consists of 45 stocks of companies that have increased their dividends for at least 15 consecutive years, derived from the full S&P Mid Cap 400 Index MID.,
    It is tracked by the ProShares S&P MidCap 400 Dividend Aristocrats ETF REGL.,

  • S&P High Yield Dividend Aristocrats Index XX: SPHYDA
    The S&P Composite 1500 Index XX:SP1500 is made up of 119 stocks
    Which has increased its dividend for at least 20 straight years. It is tracked by the SPDR S&P Dividend ETF SDY,
    The S&P Composite 1500 itself is made up of the S&P 500, the S&P Mid Cap 400, and the S&P 600 Small Cap Index (SML).,
    Therefore the S&P High Yield Dividend Aristocrats Index is comprised of all the stocks in the S&P 500 Dividend Aristocrats Index. But it does include some that are in the S&P 400 Dividend Aristocrats Index. The name of the High Yield Dividend Aristocrats Index is confusing because the yields are not necessarily high – they range from 0.31% to 6.91%.

All together, with duplicates removed, there are 134 companies in the three Dividend Aristocrats indexes.

To examine enthusiasm among analysts working for brokerage firms, we narrowed the list to 119 covered by at least five analysts provided by FactSet.

Among the 119 Dividend Aristocrats, 10 have a majority “Buy” or equivalent rating and 12-month upside potential of at least 10% based on consensus estimates:

company

anchor

Share a “Buy” rating

December 2 closing price

consensus price target

Projected 12-Month Upside Potential

dividend yield

Perrigo Companies Plc

PRGO

100%

$31.94

$49.25

54%

3.26%

The Carlisle Company Inc.

csl

75%

$259.73

$348.33

34%

1.16%

Regal Rexnord Corp.

rrx

86%

$126.00

$159.57

27%

1.11%

ABM Industries Inc.

abm

86%

$46.29

$58.00

25%

1.69%

L3Harris Technologies Inc.

LHX

52%

$230.00

$269.37

17%

1.95%

Albemarle Corporation

Alb

56%

$284.28

$317.49

12%

0.56%

Lowe’s Company Inc.

low

56%

$214.84

$239.87

12%

1.95%

Essential Utilities Inc.

WTRG

64%

$48.32

$53.56

1 1%

2.38%

Exxon Mobil Corp.

XOM

56%

$109.86

$120.59

10%

3.31%

NextEra Energy Inc.

NEE

70%

$85.20

$93.43

10%

2.00%

Source: FactSet

None of the dividend yields on the list are particularly high.

Some investors favor a higher dividend yield for current income. Going back to the full list of the 134 companies in the Three Dividend Aristocrats Index, here are the 10 with the highest dividend yields:

company

anchor

dividend yield

Share a “Buy” rating

Telephone and Data Systems Inc.

TDS

6.91%

20%

VF Corporation

VFC

6.14%

33%

Leggett & Platt Inc.

leg

4.98%

25%

National Retail Properties Inc.

nnn

4.76%

40%

Realty Income Corp.

hey

4.73%

50%

3M Co.

mmm

4.69%

5%

Walgreens Boots Alliance Inc.

wba

4.63%

17%

International Business Machines Corp.

IBM

4.44%

33%

northwest corp

My

4.33%

33%

Franklin Resources Inc.

Ben

4.26%

0%

Source: FactSet

A high dividend yield can be important if you want to generate current income, but it doesn’t necessarily correlate with strong long-term total returns.

None of the stocks on this second list of highest-yielding aristocrats have a majority “Buy” or equivalent rating, so price targets are not included in the table.

But you can click on the tickers in this article for more information about any company or index.

You should also read Tommy Kilgore’s comprehensive guide to a wealth of information on the Marketwatch quote page for free.

Don’t miss: 20 high-yielding dividend stocks that just got more attractive

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