In this article, we will take a look at some of the best dividend stocks for dependable dividend growth.
Dividend stocks continue to be a favored option among investors for their reliable income potential. Seasoned investors like Warren Buffett have long appreciated their value, as reflected by the significant number of dividend-paying companies in his portfolio. Though often overlooked, dividends have been a key contributor to long-term returns. From 1960 through the end of last year, about 85% of the market’s cumulative return came from reinvested dividends and compounding.
Dividend-focused strategies can add stability, provide regular income, and help cushion portfolios during economic uncertainty. They also tend to perform well during volatile periods. Historically, dividend-paying stocks have demonstrated strong resilience across various markets and time frames. A report from Franklin Templeton noted that over the three years ending December 31, 2024, these stocks saw lower volatility and smaller drawdowns than the broader market across US, global, and European equities. Last August, when inflation and interest rate worries returned, dividend stocks remained relatively steady.
Investors also favor companies with a history of raising dividends. According to Nuveen, firms that initiated or increased their payouts have generally outperformed in the three years following the first rate hike by the Federal Reserve. Although the Fed began cutting rates in 2024, the report suggested these cuts may slow in 2025 due to ongoing inflation pressures. Given this, we will take a look at some of the best dividend stocks for dependable dividend growth.
Our Methodology:
For this article, we scanned companies with strong dividend policies. From that list, we picked 10 companies with the highest 5-year annual average dividend growth rates. The stocks are ranked in ascending order of their annual average dividend growth in the past five years.
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10. Evergy, Inc. (NASDAQ:EVRG)
5-Year Average Dividend Growth: 5.86%
Evergy, Inc. (NASDAQ:EVRG) is often overlooked among utility stocks, despite having a strong track record of dividend growth. The company has increased its dividend for 20 consecutive years, averaging nearly 6% annual growth over the past five years. In addition, the stock has a dividend yield of 4%, as of June 17. It is one of the best dividend stocks.
Analysts expect this upward trend to continue, supported by a solid business outlook. In February, Evergy, Inc. (NASDAQ:EVRG) revealed that its pipeline of large electricity customers, such as data centers, had grown to 11.2 GW, exceeding its current peak demand. To support this growth, the company raised its 2025–2029 capital spending plan by 8% to $17.5 billion.
Earnings-wise, Evergy, Inc. (NASDAQ:EVRG) reaffirmed its long-term adjusted EPS growth target of 4% to 6% through 2029, based on a 2025 midpoint of $4.02. Starting in 2026, the company expects to hit the higher end of that range. It also maintains a solid cash position, with trailing twelve-month operating cash flow exceeding $2 billion. The company currently offers a quarterly dividend of $0.6675 per share.
Evergy, Inc. (NASDAQ:EVRG) supplies electricity to 1.7 million customers across Kansas and Missouri through its subsidiaries: Evergy Kansas Central, Evergy Metro, and Evergy Missouri West.
9. Lockheed Martin Corporation (NYSE:LMT)
5-Year Average Dividend Growth: 6.7%
Citi expects Lockheed Martin Corporation (NYSE:LMT) to lead the S&P index in return on equity (ROE) next year. The defense contractor currently has an ROE of 9.6%, but that figure is projected to surge to 93.9% by the end of 2026, according to the firm’s estimates.
Last month, Lockheed Martin Corporation (NYSE:LMT) maintained its full-year guidance, supported by strong demand for its missile systems and fighter jets. Speaking to CNBC recently, COO Frank St. John noted that defense spending continues to rise in both Europe and the US. He made the following comment:
“We are probably in the beginning of a three-to-five year surge in defense spending.”
In addition to its profitability, Lockheed Martin Corporation (NYSE:LMT) is also grabbing investors’ attention because of its dividends. The company is committed to creating shareholder value by consistently increasing its dividend and reducing its outstanding share count. It has raised its payouts for 22 consecutive years, and its 5-year average annual dividend growth rate stands at nearly 7%.
Lockheed Martin Corporation (NYSE:LMT) currently offers a quarterly dividend of $3.30 per share and has a dividend yield of 2.75%, as of June 17.
Lockheed Martin Corporation (NYSE:LMT) is a leading global company in security and aerospace, focused on developing, producing, and integrating cutting-edge technology systems, especially for defense and space sectors.
8. Merck & Co., Inc. (NYSE:MRK)
5-Year Average Dividend Growth: 7.11%
Merck & Co., Inc. (NYSE:MRK) is one of the best dividend stocks for dependable dividend growth. The company is not only recognized for its strong pipeline but also for its consistent dividend growth. It expects approvals for up to seven cardiometabolic drugs by 2030, which could collectively bring in $15 billion in annual revenue within a few years.
Overall, Merck & Co., Inc. (NYSE:MRK) believes it has 20 potential blockbuster drugs in development that could generate $50 billion annually over the next decade.
This promising outlook supports its dividend, which has increased for 14 straight years. In addition, in the past five years, it has raised its payouts at an annual average rate of over 7%. With a trailing twelve-month operating cash flow of $20.8 billion and levered free cash flow of $17.1 billion, Merck & Co., Inc. (NYSE:MRK) appears well-positioned to continue raising its dividend.
A payout ratio of around 45% also provides a cushion, suggesting the dividend remains safe even if earnings dip. The stock supports an attractive dividend yield of 4.14%, as of June 17.
Merck & Co., Inc. (NYSE:MRK) is a global healthcare company focused on providing innovative health solutions through its range of medicines, vaccines, biologic treatments, and animal health products.
7. JPMorgan Chase & Co. (NYSE:JPM)
5-Year Average Dividend Growth: 7.6%
JPMorgan Chase & Co. (NYSE:JPM) is among the best dividend stocks for dependable dividend growth. According to Wolfe Research, investors should consider JPM amid volatility. The stock has surged by over 12% since the start of 2025, outperforming the broader market by a wide margin.
With markets remaining unsettled due to evolving trade policies and geopolitical tensions, Wolfe Research is focusing on companies with a long-standing habit of buying back their own shares as a way to weather the volatility, and JPMorgan Chase & Co. (NYSE:JPM) made the cut.
Wolfe’s “consistent buyback” list highlights firms that have reduced their share count for at least 10 consecutive years. According to Chief Investment Strategist Chris Senyek, this group of stocks tends to perform well during defensive market phases and around periods of economic downturn.
According to the firm, JPMorgan Chase & Co. (NYSE:JPM) kicked off 2025 by increasing its share repurchases, despite CEO Jamie Dimon expressing caution at the bank’s 2024 investor day, when he felt the stock was somewhat overvalued. However, with JPM sitting on a growing cash reserve, the buybacks moved forward.
Wolfe’s data indicates the bank’s buyback-to-market-cap ratio stands at 4%. So far in 2025, JPMorgan stock has seen steady performance, and about 56% of analysts tracked by FactSet have rated it a “Buy,” with the average price target suggesting a roughly 3% potential upside.
JPM is also a solid dividend payer, currently offering a quarterly dividend of $1.40 per share for a dividend yield of 2.08%, as of June 17.
JPMorgan Chase & Co. (NYSE:JPM) is a leading provider of investment banking, commercial banking, asset management, and financial transaction services. The firm serves millions of customers across the U.S., along with major corporate, institutional, and government clients around the world.
6. Abbott Laboratories (NYSE:ABT)
5-Year Average Dividend Growth: 10.89%
Abbott Laboratories (NYSE:ABT) is one of the best dividend stocks for dependable dividend growth. The company is a Dividend King with 53 consecutive years of dividend growth. Its five-year average annual dividend growth rate sits at nearly 11%. It pays a quarterly dividend of $0.59 per share and has a dividend yield of 1.78%, as of June 17.
Leerink Partners has initiated coverage of the medical devices company, assigning it a hold-equivalent rating along with a target price of $143. This target suggests an upside of less than 6% from the stock’s closing price on Friday. Although Abbott Laboratories (NYSE:ABT) is recognized for its strong industry position, Leerink’s analysts mentioned that they think “potential upside growth drivers and strong execution” are mostly already reflected in the company’s “stock at current peak valuation levels,” and they do not see any significant near-term catalysts.
Abbott Laboratories (NYSE:ABT) recently received positive news from Canada, where the government approved a rapid blood test designed to assist clinicians in evaluating suspected concussions. Although this may not have an immediate significant impact, it’s an intriguing product with potential applications, such as at sporting events.
Abbott Laboratories (NYSE:ABT) is an international healthcare company that develops, produces, and markets a broad variety of health-related products. The stock has surged by over 16% since the start of 2025.
5. Oracle Corporation (NYSE:ORCL)
5-Year Average Dividend Growth: 12.11%
Oracle Corporation (NYSE:ORCL) is among the best dividend stocks offering dividend growth. According to a report by CNBC, ORCL was the most overbought stock in the S&P index last week, with an RSI of 90.4. The software company’s shares jumped nearly 8% on June 13, hitting a record high and building on June 12’s 13% surge.
Over the entire week, Oracle Corporation (NYSE:ORCL) stock climbed over 17%. Analysts surveyed by LSEG have an average price target of about $205, suggesting nearly 5% downside from the June 13 closing price, though many of these targets may increase following the company’s recent earnings report.
Most of the week’s gains came after Oracle Corporation (NYSE:ORCL)’s fiscal fourth-quarter results exceeded Wall Street expectations. CEO Safra Catz noted that cloud infrastructure revenue is projected to grow more than 70% in fiscal 2026, adding that the fiscal year “will be even better as our revenue growth rates will be dramatically higher.”
Oracle Corporation (NYSE:ORCL)’s dividend is also grabbing investors’ attention. The company has never missed a dividend since 2009 and has raised its payouts at an annual average rate of over 12% in the past five years. Currently, it pays a quarterly dividend of $0.50 per share and has a dividend yield of 0.96%, as of June 17.
Oracle Corporation (NYSE:ORCL) is a global tech company that specializes in cloud-based applications and infrastructure, building on its long-standing expertise in database management systems.
4. Broadcom Inc. (NASDAQ:AVGO)
5-Year Average Dividend Growth: 13.63%
Broadcom Inc. (NASDAQ:AVGO) is one of the best dividend stocks with dependable dividend growth. The stock was recently added to Citi’s updated “Positive ROE Trend” stock basket, an index of companies expected to see rising return on equity (ROE), largely fueled by improved margins or enhanced efficiency, as measured by total asset turnover, according to strategist Scott Chronert.
Citi Research noted that high-quality companies generating strong returns are becoming increasingly difficult to find. Chronert explained in a client note that ROE, which is a measure of profitability calculated by dividing net income by shareholders’ equity, is “increasingly scarce” among large-cap stocks.
Still, Citi believes Broadcom Inc. (NASDAQ:AVGO) stands out as a reliable profit generator. The company is projected to achieve an ROE of over 43% by the end of 2026, marking a sharp increase from current levels. The stock has jumped approximately 51% this quarter and is up by over 7% year to date.
Broadcom Inc. (NASDAQ:AVGO)’s CEO recently stated that the firm expects its AI-related revenue growth in fiscal 2025 to “sustain into fiscal 2026,” driven by continued strong demand for its custom AI chips and networking products.
Broadcom Inc. (NASDAQ:AVGO)’s dividend policy is also very strong, as the company has been rewarding shareholders with growing dividends for the past 14 years. It pays a quarterly dividend of $0.59 per share for a dividend yield of 0.95%, as of June 17.
Broadcom Inc. (NASDAQ:AVGO) is a global tech firm that designs, develops, and delivers a broad portfolio of semiconductor and infrastructure software products.
3. Eli Lilly and Company (NYSE:LLY)
5-Year Average Dividend Growth: 15.12%
Eli Lilly and Company (NYSE:LLY) is one of the best dividend stocks offering dividend growth. According to Adam Parker, founder of Trivariate Research, investors aiming for a defensive approach might want to look at select dividend-paying stocks. In a note dated June 8, Parker mentioned that while many institutional investors still expect the S&P to climb higher, there’s also growing interest in identifying solid defensive options.
He noted that the “old school” strategy of leaning on traditional defensive sectors like consumer staples, pharmaceuticals, and telecoms appears to be “broken.” In response, Trivariate has outlined alternative strategies for defensive positioning, one of which includes focusing on dividend-paying equities. Parker made the following comment:
“We think companies with consistent dividend growth are likely to provide strong defense if there’s a growth scare. Specifically, our past work shows that companies that have grown their dividend over the last five years and that are indicated to have continued dividend growth, as well as at least 7% forecasted sales growth and 10% forecasted earnings growth outperform.”
Eli Lilly and Company (NYSE:LLY) was the only pharmaceutical company to make the list. The firm offers a dividend yield of 0.76% and has seen its stock has surged by nearly 2% year-to-date. In May, the company posted better-than-expected earnings and revenue for the first quarter but trimmed its full-year profit outlook due to costs tied to a cancer drug deal. However, it kept its full-year sales forecast unchanged.
Following the earnings release, CEO Dave Ricks told CNBC that the potential market for its widely used weight-loss and diabetes medications is “massive.” Eli Lilly and Company (NYSE:LLY)’s diabetes drug is Mounjaro, while Zepbound is its treatment for obesity. Ricks made the following statement in an interview with ” Squawk Box ” on May 1:
“Today we probably have about 10 million Americans taking GLP-1s. The market opportunity is much, much larger than that. We see this as a big wave of innovation for many years to come and Lilly is at the forefront of that.”
According to FactSet, Eli Lilly and Company (NYSE:LLY) holds an average rating of “Overweight,” with analysts projecting nearly 21% upside based on the stock’s average price target.
2. Lowe’s Companies, Inc. (NYSE:LOW)
5-Year Average Dividend Growth: 15.90%
Lowe’s Companies, Inc. (NYSE:LOW) is among the best dividend stocks for dependable dividend growth. Since going public in 1961, the company has paid regular dividends to shareholders and has raised its dividend for 60 consecutive years. In addition, it has boosted the payout by an average of over 16% over the past five years.
Investors worried about a housing slowdown may find reassurance in tight inventory, which often leads homeowners to invest in upgrades. While short-term renovation spending may fluctuate, demand tends to recover over time.
Despite economic concerns, long-term trends in home improvement remain strong. As confidence returns, Lowe’s Companies, Inc. (NYSE:LOW) is well-positioned to benefit, given its history of growth in this space.
Lowe’s Companies, Inc. (NYSE:LOW) currently offers a quarterly dividend of $1.20 per share and has a dividend yield of 2.27%, as of June 17.
1. Canadian Natural Resources Limited (NYSE:CNQ)
5-Year Average Dividend Growth: 22.5%
Canadian Natural Resources Limited (NYSE:CNQ) is one of the best dividend stocks for dividend growth. The company has built a strong reputation for dividend reliability, having raised its payout for 25 consecutive years, which is a notable feat for a company tied to commodity price cycles. In 2024 alone, the board approved three dividend increases, and it has already raised the payout again in 2025, despite weaker oil prices. Over the past five years, dividends have grown at an average annual rate of 22.5%.
In addition to steady dividends, Canadian Natural Resources Limited (NYSE:CNQ) has delivered impressive capital gains of about 296% over the past five years. This performance is backed by its strong production mix, long-life low-decline assets, efficient operations, and disciplined capital management, all of which support robust distributable cash flow.
Its high-value, zero-decline synthetic crude production adds operational stability and keeps reserve replacement costs low. The company also maintains a healthy cash position, generating $4.3 billion in operating cash flow in Q1 2025, of which $1.8 billion was returned to shareholders via dividends and buybacks. The company currently offers a quarterly dividend of C$0.5875 per share and has a dividend yield of 5.09%, as of June 17.
Canadian Natural Resources Limited (NYSE:CNQ) is a major energy company engaged in exploring, developing, producing, and marketing crude oil and natural gas.
While we acknowledge the potential of CNQ to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than CNQ and that has 100x upside potential, check out our report about this cheapest AI stock.
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