Dividend Champions List: What You Need to Know

Have you ever seen a company boast about their position on the Dividend Champions list?

For businesses that make the exclusive list every year, it’s quite an accomplishment. But what does that mean for the average investor?

Whether you regularly invest or not, you probably know that the way to make money on an investment is to buy low and sell high.

The risk comes with the fact that you don’t know how a company will fare from year to year. In fact, you could lose your investment entirely.

Taking a Risk

So, why should you take the risk at all?

If you want to invest in the market, you always run a risk. You can minimize that risk by doing research, looking at historical data, and diversifying your portfolio.

But if you want to make money without selling your positions, there’s a way to do that too. You can accomplish this by choosing companies that give dividends to their investors to share in the company profits.

And if you want to use dividend distributions as a factor in choosing a company in which to invest, the best place to look is the Dividend Champions list.

The Dividend Champions list is updated at the end of every month and includes companies that release regular dividend distributions.

So, you can adjust your portfolio on a regular basis if you choose to. Although this doesn’t eliminate your investment risk, it shows you the listed companies’ longevity and profitability.

But before you look on the list for stocks to buy, you first need to know about stock dividends.

What Is a Stock Dividend?

A stock dividend is a payment a company makes to its shareholders in the form of extra shares. A publicly-held business does this because they want to share their profits with the investors who support them.

Sometimes companies even offer cash instead of stocks for their dividend payouts.

One of the benefits of a stock dividend is that you don’t have to pay taxes on the gift until you sell the stock. So, the extra shares will increase your position with the company without any cost to you.

The downside of a stock dividend is that the distribution can cause the stock price to dip a bit. That happens because there are now more outstanding shares for the company, and it slightly dilutes the price.

Not every company offers a stock dividend, and price dilution may be partially to blame. But some businesses consistently pay dividends to their shareholders.

And it’s those businesses who can make it on the monthly Dividend Champions list.

What Makes a Company Distribution a Dividend Champion?

To make it on the Dividend Champions list, a stock must release a dividend every year for 25 or more years in a row. And since businesses can run on different fiscal cycles, updates to the list happen at the end of every month.

As you can imagine, this isn’t an easy feat considering these companies can afford the increases in dividend distributions over such a long period.

In fact, in October of 2020, there were only 136 companies on the Dividend Champions list.

Dividend Champions List for October 2020

Although the list is continually changing, the companies on the list as of October 5, 2020, include businesses offering regular dividends for decades.

We’ve organized this compilation by the length of time each company made the Dividend Champions list.

The over 60 club

  • American States Water
  • Dover Corp.
  • Genuine Parts Co.
  • Northwest Natural Gas
  • Procter & Gamble Co.
  • Emerson Electric
  • Parker-Hannifin Corp.
  • 3M Company
  • Cincinnati Financial

Between 40 and 59 years

  • Johnson & Johnson
  • Coca-Cola Company
  • Lowe’s Companies
  • Colgate-Palmolive
  • Farmers & Merchants Bancorp
  • Lancaster Colony Corp.
  • Nordson Corp.
  • ABM Industries
  • California Water Service
  • Federal Realty Inv. Trust
  • Hormel Foods Corp.
  • SJW Corp.
  • Stanley Black & Decker
  • Target Corp.
  • Commerce Bancshares
  • Stepan Company
  • Tootsie Roll Industries
  • H.B. Fuller Company
  • Altria Group Inc.
  • National Fuel Gas
  • Sysco Corp.
  • Black Hills Corp.
  • Computer Services, Inc.
  • W.W. Grainger, Inc.
  • MSA Safety, Inc.
  • PPG Industries Inc.
  • Universal Corp.
  • Becton Dickinson & Co.
  • Kimberly-Clark Corp.
  • Leggett & Platt Inc.
  • PepsiCo Inc.
  • Tennant Company
  • Gorman-Rupp Company
  • Middlesex Water Co.
  • Nucor Corp.
  • S&P Global Inc.
  • VF Corp.
  • Wal-Mart Inc.
  • Consolidated Edison
  • Illinois Tool Works
  • RPM International Inc.
  • Telephone & Data Sys.
  • Archer Daniels Midland
  • MGE Energy Inc.
  • RLI Corp.
  • United Bankshares, Inc.
  • Walgreens Boots Alliance Inc.
  • Automatic Data Proc.
  • Carlisle Companies
  • McDonald’s Corp.
  • Pentair Ltd.
  • Clorox Company
  • Medtronic plc
  • Sherwin-Williams Co.
  • Franklin Resources
  • Community Trust Banc.

Companies on the list for 28 to 39 years

  • Eaton Vance Corp.
  • Old Republic International
  • AFLAC Inc.
  • Air Products & Chem.
  • Weyco Group Inc.
  • Cintas Corp.
  • Sonoco Products Co.
  • ExxonMobil Corp.
  • Atmos Energy
  • Brown-Forman Class B
  • AT&T Inc.
  • Brady Corp.
  • NACCO Industries
  • Universal Health Realty Trust
  • T. Rowe Price Group
  • Chevron Corp.
  • Donaldson Company
  • Eagle Financial Services
  • Mercury General Corp.
  • McCormick & Co.
  • Tompkins Financial Corp.
  • UGI Corp.
  • 1st Source Corp.
  • National Retail Properties
  • First Financial Corp.
  • Erie Indemnity Company
  • Jack Henry & Associates
  • Community Bank System
  • General Dynamics
  • SEI Investments Company
  • Arrow Financial Corp.
  • Artesian Resources
  • Badger Meter, Inc.
  • Chesapeake Financial Shares
  • Enterprise Bancorp Inc.
  • Ecolab Inc.
  • Franklin Electric Co.
  • MDU Resources
  • McGrath Rentcorp
  • People’s United Financial
  • UMB Financial Corp.
  • Westamerica Bancorp
  • Essential Utilities, Inc.

The newcomers: 25 to 27 years

  • BancFirst Corp. OK
  • Chubb Limited
  • John Wiley & Sons, Inc.
  • Linde Plc
  • Realty Income Corp.
  • PSB Holdings Inc.
  • Roper Technologies Inc.
  • Stryker Corp.
  • Thomson Reuters Corp.
  • West Pharmaceutical Services
  • Albemarle Corp.
  • A.O. Smith Corp.
  • AptarGroup Inc.
  • Brown & Brown, Inc.
  • Caterpillar Inc.
  • Cullen/Frost Bankers
  • Essex Property Trust
  • Expeditors International
  • NextEra Energy Inc.
  • Raytheon Technologies
  • Canadian National Railway
  • First of Long Island Corp.
  • International Business Machines
  • Lincoln Electric Holdings
  • Matthews International
  • Northeast Indiana Bancorp
  • New Jersey Resources
  • Polaris Industries
  • RenaissanceRe Holdings
  • Southside Bancshares

Dividend Champions Contenders

Unlike the Dividend Champions list requirement of 25 consecutive dividend distribution years, the list of contenders includes companies on their way to becoming champions.

These stable companies have 10 consecutive years of dividend distributions, which is a good indicator of consistent growth and strength.

Although they have a ways to go before hitting the Dividend Champions list, each year, they ensure their investors reap a portion of the profits they earn.

That alone could be a good reason for investment consideration if dividend distribution stocks interest you.

Make Your Money Work for You

When you’re looking to invest in the stock market, there are many factors to consider. One of those factors is your confidence in a company to stand the test of time and remain profitable.

Some may use the metric of dividend distributions to gauge a company’s strength and longevity when deciding on whether it’s a good investment.

Certainly, a place on the Dividend Champions list shows stamina and profits over an extended period. And it could give you extra confidence in your investment.

Before you put your money anywhere in the market, thoroughly investigate the company, and see if they are a good fit in your portfolio. And if you’re unsure of what makes a good investment, speak to a professional.

Are you invested in any of the Dividend Champions? Was their place on the list a deciding factor in your investment decision? Let us know your thoughts in the comments.