In this article, we will take a look at some of the best dividend kings to invest in.
Dividend Kings are the rare companies that have increased their dividends for 50 straight years or more. Stocks like these have stayed popular with investors for a simple reason. Over many market cycles, dividend-paying companies have often delivered better long-term results than businesses that do not pay dividends. They also tend to carry a lower risk profile, since dividend payouts are usually backed by steady cash flow and financially disciplined operations.
Looking at long-term stock performance makes the role of dividends even clearer. A report from Anchor Capital Advisors noted that dividends were a major driver of total returns up until the late 1980s, but their importance faded during the late 1990s as investors became more focused on growth stocks. Then the market environment flipped. During the “lost decade” of the 2000s, dividends became one of the main reasons investors were still able to generate returns. After the dot-com bubble burst, many investors shifted their attention back toward dividend income and stability.
Industry research also suggests dividend stocks do not just offer stronger returns. They often come with meaningfully lower volatility compared to non-dividend payers. Some investors still assume dividend stocks are slow-moving, outdated businesses with limited growth. In reality, dividend-paying companies exist across a wide range of sectors and industries. Dividends can also create discipline at the management level, since regular payouts reduce the temptation to spend excess cash on aggressive deals that could end up diluting shareholder value.
Given this, we will take a look at some of the best dividend kings to invest in.
Our Methodology:
For this list, we reviewed the Dividend Kings companies and selected the 13 stocks that were most favored by hedge funds in the third quarter of 2025, using data from Insider Monkey’s database. The stocks are ranked by the number of hedge fund investments, starting with the lowest.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 427.7% since May 2014, beating its benchmark by 264 percentage points (see more details here).
13. Cincinnati Financial Corporation (NASDAQ:CINF)
Number of Hedge Fund Holders: 25
Consecutive Years of Dividend Growth: 65
On January 6, Keefe Bruyette raised its price target on Cincinnati Financial Corporation (NASDAQ:CINF) to $191 from $180 and kept an Outperform rating on the stock.
A day earlier, on January 5, BofA went the other way. The bank cut its price target to $180 from $186, while maintaining a Buy rating. In its note, the analyst said pricing trends across most P&C insurance products still look weak, similar to what played out in 2025. Liability lines are one bright spot, but the analyst warned that loss costs appear to be rising faster than prices. They also noted that personal auto rates have been largely flat, even though some investors had been expecting declines given how profitable the segment has been. Even so, BofA said insurer valuations “hardly look expensive,” even as fundamentals have moved in the “wrong direction.”
Cincinnati Financial Corporation (NASDAQ:CINF)’s underwriting record has stayed strong. Over the past five years, the company has posted an average combined ratio of 94.6%. Put simply, for every $100 in premiums it wrote, it kept around $5 as underwriting profit. In an industry where combined ratios often hover near 100%, staying consistently below that level signals disciplined underwriting and supports long-term growth.
Cincinnati Financial Corporation (NASDAQ:CINF) mainly sells business, home, and auto insurance through The Cincinnati Insurance Company and its two standard market property casualty insurance subsidiaries.
12. Federal Realty Investment Trust (NYSE:FRT)
Number of Hedge Fund Holders: 31
Consecutive Years of Dividend Growth: 58
On January 14, Scotiabank trimmed its price target on Federal Realty Investment Trust (NYSE:FRT) to $113 from $114 and maintained an Outperform rating on the stock. The analyst said the firm is refreshing price targets across the US Real Estate and REIT names it covers ahead of the Q4 earnings season. Scotiabank also pointed to Self Storage and Multifamily as two areas where buy-side sentiment has been improving, with the view that both sectors are less likely to disappoint when companies issue FY26 guidance.
Federal Realty has also been showing up more often in bullish conversations on Wall Street. In a CNBC report published on December 31, analysts noted that while real estate struggled through much of 2025, Federal Realty stood out as a name that may be overlooked going into 2026. Jefferies analyst Linda Tsai reportedly called the company a top idea for 2026 and upgraded the stock to Buy.
A big part of the optimism centers on Federal Realty’s capital recycling strategy. The company has been selling mature, long-held retail assets and redeploying that capital into higher-quality growth opportunities. On December 17, Federal Realty announced it had sold a residential building in North Bethesda, Maryland, along with a grocery-anchored shopping center in Bristol, Connecticut, for roughly $170 million combined. On the reinvestment side, the trust has also been active, including a $153.3 million acquisition of Village Pointe in Omaha, Nebraska. That property is home to well-known tenants such as Apple, Coach, and Sephora.
Federal Realty Investment Trust (NYSE:FRT) is an equity REIT that focuses on owning, operating, and redeveloping retail-based real estate. Its portfolio is concentrated in major coastal markets, along with select underserved regions where economic conditions and demographic trends remain supportive.
11. Commerce Bancshares, Inc. (NASDAQ:CBSH)
Number of Hedge Fund Holders: 34
Consecutive Years of Dividend Growth: 56
On January 9, Piper Sandler raised its price target on Commerce Bancshares, Inc. (NASDAQ:CBSH) to $64 from $60 while keeping a Neutral rating on the stock. The update came after the company officially closed its acquisition of FineMark National Bank & Trust. Piper also lifted its 2026 operating EPS estimate to $4.25 from $4.00, reflecting the earnings lift it expects from FineMark.
In the firm’s view, FineMark fits neatly into Commerce’s existing strategy. Piper described the deal as highly complementary to Commerce’s already strong wealth management platform, adding more scale and giving the bank a stronger foothold in several appealing markets. The firm also believes those new markets could support better organic loan growth over time.
Commerce confirmed the closing of the transaction on January 1. FineMark Holdings, the parent of FineMark National Bank & Trust, is now part of Commerce Bancshares, the parent of Commerce Bank. With the deal completed, Commerce now sits at around $36 billion in assets and roughly $90 billion in assets under administration. On a pro forma basis, using data as of September 30, 2025, it places it 15th among bank-managed trust companies based on assets under management.
The acquisition also strengthens Commerce’s private banking and wealth management operations. It builds on the bank’s existing footprint in Florida and adds new locations in Arizona and South Carolina.
Soon after the deal closed, FineMark National Bank & Trust was merged into Commerce Bank. FineMark will continue operating as FineMark Bank & Trust, a division of Commerce Bank, and will keep serving clients from the same locations, while maintaining its current advisor-client relationships.
Commerce Bancshares, Inc. (NASDAQ:CBSH) is a regional bank holding company that provides traditional banking services, payment solutions, wealth management, and securities brokerage through its subsidiaries.
10. Stanley Black & Decker, Inc. (NYSE:SWK)
Number of Hedge Fund Holders: 37
Consecutive Years of Dividend Growth: 58
On January 14, Wells Fargo analyst Joseph O’Dea raised the firm’s price target on Stanley Black & Decker, Inc. (NYSE:SWK) to $82 from $75, while keeping an Equal Weight rating on the stock. In his view, 2026 has started on a shaky note, with volatility picking up again. Ahead of the company’s quarterly results, Wells Fargo also warned that anything tied closely to builders looks especially risky after the recent rally. The firm said the broader products space is sending mixed signals and still does not look compelling. The takeaway was clear: don’t chase the stock after the move higher.
In other news, on December 22, Stanley Black & Decker announced it had signed a definitive agreement to sell its Consolidated Aerospace Manufacturing (CAM) business to Howmet Aerospace for $1.8 billion in cash. CAM makes critical fasteners, fittings, and other engineered components used in aerospace and defense.
The business is expected to generate around $405 million to $415 million in FY 2025 revenue, with an adjusted EBITDA margin in the high-teens. Stanley Black & Decker said it plans to use the net cash proceeds mainly to pay down debt, which should help strengthen its balance sheet.
Until the transaction closes, CAM’s financial results will stay under continuing operations and will not be reclassified as discontinued operations. The sale is expected to close in the first half of 2026, assuming regulatory approvals and other standard closing conditions are met.
Stanley Black & Decker, Inc. (NYSE:SWK) is a global tools and industrial company, known for its hand tools, power tools, outdoor equipment, and related accessories. It also has a presence in engineered fastening solutions.
9. Illinois Tool Works Inc. (NYSE:ITW)
Number of Hedge Fund Holders: 39
Consecutive Years of Dividend Growth: 53
Illinois Tool Works Inc. (NYSE:ITW) is one of the best dividend kings to invest in.
On January 12, Deutsche Bank put a “Catalyst Call: Sell” on Illinois Tool Works Inc. (NYSE:ITW), pitching it as a short-term trade. The analyst said the stock’s recent underperformance likely isn’t over yet and could drag into the Q4 earnings season. Deutsche Bank also argued that if ITW falls short and issues weaker-than-expected guidance, the shares could take another hit, warning that a “miss and guidance positioned below consensus will result in share price underperformance on earnings day.”
That’s the near-term view. Over the long run, ITW has a very different reputation. It’s one of those industrial names that has repeatedly set ambitious targets, met them, and steadily delivered value back to shareholders over many years.
Looking ahead, ITW’s 2024–2030 plan centers on organic growth, driven by its Customer-Back Innovation process. Instead of brainstorming products internally and hoping the market responds, ITW focuses on customer input and builds solutions around real needs. The company’s goal is to take its existing portfolio of brands and push them further through product development and a broader global sales reach, rather than leaning too heavily on acquisitions.
Illinois Tool Works Inc. (NYSE:ITW) is a global industrial manufacturer with a wide mix of products and equipment sold across a range of markets.
8. Emerson Electric Co. (NYSE:EMR)
Number of Hedge Fund Holders: 41
Consecutive Years of Dividend Growth: 67
On January 16, JPMorgan analyst Stephen Tusa raised JPMorgan’s price target on Emerson Electric Co. (NYSE:EMR) to $157 from $150, while keeping a Neutral rating on the stock. The change was part of the bank’s broader Q4 earnings preview for the electrical equipment and multi-industry space, where it updated a range of ratings and targets. JPMorgan said it is leaning more favorably toward “growth related names into and out of the quarter.”
That comes as Emerson continues working through a mixed demand environment. Back in November, the company reported fourth-quarter revenue that came in below expectations, with demand for its automation equipment remaining uneven. Emerson has spent the last few years reshaping itself into a more automation-focused business, but the transition has not been completely smooth. The company is still trying to build stronger momentum in the unit, and margins have not ramped up as much as investors have wanted.
To position itself for longer-term automation demand, Emerson has also been active on the deal front, streamlining its portfolio and investing heavily in areas it believes will drive growth. One of the biggest moves was last year’s agreement to buy the remainder of AspenTech that it did not already own, valuing the deal at roughly $15.1 billion.
Even with automation demand moving in fits and starts, not all parts of the business have been under pressure. Emerson’s measurement and analytical devices segment has continued to hold up well, supported by steady demand from customers across chemical, oil, and gas markets.
Emerson Electric Co. (NYSE:EMR) is a global technology and software company that provides solutions to customers across a wide range of industries around the world.
7. Dover Corporation (NYSE:DOV)
Number of Hedge Fund Holders: 55
Consecutive Years of Dividend Growth: 70
Dover Corporation (NYSE:DOV) is one of the best dividend kings to invest in.
On January 15, RBC Capital analyst Deane Dray nudged up the firm’s price target on Dover Corporation (NYSE:DOV) to $199 from $198 and kept a Sector Perform rating on the stock. The change came in a broader note previewing Q4 earnings across the Multi-Industry group. RBC said it likes the overall setup heading into 2026, pointing to a long list of supportive themes, including multi-year secular drivers, megaproject activity, continued datacenter strength, and what it sees as an attractive valuation backdrop for the sector.
At the same time, the firm made it clear that the recovery is not evenly spread. RBC described the current environment as a “two-speed economy,” where datacenter-related demand is running in the mid-teen% range or higher, while most other industrial categories are struggling to grow much at all. In fact, the analyst noted many names are still dealing with “sluggish and uneven demand.” Even so, RBC said it remains constructive on the longer-term outlook, especially given the secular tailwinds tied to electrification, reshoring, the energy transition and storage, and the datacenter buildout.
Within that backdrop, Dover has been positioning itself around areas where demand is more durable and where it can compound growth over time. Recently, the company has been pushing deeper into digital offerings, tightening up operations to improve efficiency, and allocating more investment toward faster-growing end markets such as clean energy, biopharma process solutions, and data center technologies. Management has highlighted Dover’s diversified model as a key advantage, noting that active portfolio management, innovation, sustainability efforts, and disciplined capital allocation help the business stay resilient through slowdowns in any one area while still capturing long-term growth trends like energy transition and industrial automation.
Dover Corporation (NYSE:DOV) is a diversified global industrial manufacturer and solutions provider. Through its Engineered Products segment, the company sells a range of equipment, components, software, and services into markets such as the vehicle aftermarket, aerospace and defense, and other industrial end users.
6. Colgate-Palmolive Company (NYSE:CL)
Number of Hedge Fund Holders: 56
Consecutive Years of Dividend Growth: 63
On January 16, Barclays analyst Lauren Lieberman raised Barclays’ price target on Colgate-Palmolive Company (NYSE:CL) to $83 from $80 and kept an Equal Weight rating on the stock. The change came as part of the firm’s broader Q4 earnings preview for the consumer staples group, where it updated several targets across the sector. Barclays said the recent “enthusiasm” around Colgate’s shares appears to be driven largely by “a flight to safety,” as investors rotate into more defensive names. Even so, the firm said it is still uneasy about the company’s fundamentals, as well as the overall backdrop for the sector. The analyst also flagged potential pressures in 2026, warning that oil and currency headwinds could become more meaningful.
Just a few days earlier, on January 13, Wells Fargo took a more constructive turn on the stock. The firm upgraded Colgate to Equal Weight from Underweight and raised its price target to $86 from $77. Wells Fargo said the stock now offers a more balanced risk/reward profile at current levels, adding that many of the key concerns around sales growth and valuation have already played out.
Colgate-Palmolive Company (NYSE:CL) is a consumer products company focused on categories such as Oral Care, Personal Care, Home Care, and Pet Nutrition.
5. Parker-Hannifin Corporation (NYSE:PH)
Number of Hedge Fund Holders: 57
Consecutive Years of Dividend Growth: 69
Parker-Hannifin Corporation (NYSE:PH) is among the best dividend kings to invest in.
On January 16, Stifel analyst Nathan Jones reiterated a Hold rating on Parker-Hannifin Corporation (NYSE:PH) and kept his price target at $869. The call followed a distributor survey covering 38 North American distributors, representing roughly 11% of Parker’s regional revenue. According to the analyst, feedback from the channel suggests Parker’s Q2 results came in a bit softer than earlier expectations, with slightly weaker sales trends and inventory levels. He also pointed to price deceleration and slightly lower forecasts for the next 12 months. In terms of what’s weighing on demand, distributors highlighted tariffs, local economic conditions, and inflation as the biggest factors. One encouraging signal, though, is that fewer distributors now expect a recession within the next year.
In other news, Parker made a major strategic move earlier in November, announcing plans to acquire Filtration Group from privately held Madison Industries for $9.25 billion. The deal is aimed at strengthening Parker’s position in the aftermarket business, which is an important area for industrial companies because it centers on replacement parts, ongoing maintenance, and recurring customer demand. That tends to create steadier revenue streams and can be more profitable than one-time equipment sales.
Filtration Group sells air and liquid filtration systems to industrial customers as well as the heating and cooling markets. Notably, about 85% of its revenue comes from the aftermarket, and the company expects roughly $2 billion in sales in 2025. For Parker, filtration is already a major driver as its filtration and engineered materials segment led the company in fiscal 2025, generating $5.81 billion in revenue and representing 42.5% of total sales.
The broader theme here is also working in Parker’s favor. Investor interest in filtration, separation, and water-related businesses has been rising as demand grows for cleaner air and water. Lincoln International Managing Director and Co-Head of Industrials Bobby Reifman, who advised on the deal, said those markets are seeing strong attention from investors for that reason.
Parker said it will fund the acquisition using a mix of new debt and cash on hand. The transaction is expected to close within six to twelve months, assuming it clears standard regulatory and closing conditions.
Parker-Hannifin Corporation (NYSE:PH) is a global industrial company focused on motion and control technologies. It designs and manufactures highly engineered products and systems, while also supporting customers through its aftermarket service and replacement parts business.
4. Lowe’s Companies, Inc. (NYSE:LOW)
Number of Hedge Fund Holders: 68
Consecutive Years of Dividend Growth: 60
On January 16, Truist raised its price target on Lowe’s Companies, Inc. (NYSE:LOW) to $295 from $269 and maintained a Buy rating on the stock. The update was included in a broader research note covering hardlines and broadlines consumer names. Truist said it made the adjustment after reviewing its latest Truist Card data and ICR holiday updates, which led the firm to fine-tune its sales and earnings expectations. Truist also pointed to a potential tailwind for the broader retail space: a meaningful rise in tax refunds. The analyst believes that could help lift retail sales during months that are usually seasonally slower. For Lowe’s specifically, the firm said sales trends held up well in December, even with tougher year-over-year comparisons.
From an income perspective, Lowe’s remains a dependable dividend name. The company’s payout ratio sits around 38%, which gives it room to continue raising dividends over time. In practical terms, dividend growth should roughly track improvements in net income, assuming the payout ratio stays in that same range.
Lowe’s recent deal activity could also support that longer-term income story. Earlier this year, the company acquired Artisan Design Group and Foundation Building Materials, spending more than $10 billion combined. Those acquisitions fit into Lowe’s push to expand further into the professional customer segment by strengthening distribution capabilities and adding more building materials that serve residential and commercial contractors.
Lowe’s Companies, Inc. (NYSE:LOW) is one of the largest home improvement retailers, offering products across construction, maintenance, repair, remodeling, and decorating.
3. The Coca-Cola Company (NYSE:KO)
Number of Hedge Fund Holders: 78
Consecutive Years of Dividend Growth: 63
According to a January 14 report from the Financial Times, The Coca-Cola Company (NYSE:KO) has dropped its plans to sell Costa Coffee after private equity offers came in below what the company was hoping to get. That decision marks another rough chapter in Coke’s ownership of the UK-based coffee chain, which has struggled to meet expectations.
The FT said Coca-Cola ended talks with the remaining bidders in December, effectively shutting down an auction process that had been running for months. Two people familiar with the discussions told the newspaper that firms still involved in the later stages included TDR Capital (which owns Asda) and Bain Capital’s special situations fund, which owns brands such as Gail’s and PizzaExpress.
Coca-Cola had reportedly been aiming for around £2 billion for Costa. That would have been a steep markdown from the £3.9 billion it paid in 2018, when it bought the chain from Whitbread, the owner of Premier Inn. The decision to pause the sale comes at a sensitive time internally. The FT noted that Coca-Cola’s chief operating officer, Henrique Braun, is expected to replace James Quincey as CEO in March. One person close to Coca-Cola’s thinking said the company could still revisit a potential sale in the medium term, but for now, it has chosen to step back.
Quincey, who told analysts last July that Costa had “not delivered” for Coca-Cola, is set to move into the executive chair role. Ending the sale process also raises another issue: the value of Costa on Coca-Cola’s books. If the business is worth less than previously assumed, Coca-Cola may eventually need to take a write-down. Costa has already taken hits in certain markets. In 2024, it recorded an impairment of £48.6 million tied to its China business, blaming weaker-than-expected demand in its Shanghai coffee shops.
The Coca-Cola Company (NYSE:KO) is a global beverage company with brands across a wide range of categories. Its flagship sparkling soft drinks include Coca-Cola, Sprite, and Fanta.
2. The Procter & Gamble Company (NYSE:PG)
Number of Hedge Fund Holders: 87
Consecutive Years of Dividend Growth: 69
The Procter & Gamble Company (NYSE:PG) is one of the best dividend kings to invest in.
On January 16, Barclays analyst Lauren Lieberman raised the firm’s price target on The Procter & Gamble Company (NYSE:PG) to $155 from $151 and maintained an Equal Weight rating on the stock. The change was part of Barclays’ broader Q4 earnings preview for the consumer staples space, where it updated targets across the group. Barclays said the recent “enthusiasm” around P&G looks driven by “a flight to safety,” rather than improving fundamentals. The firm also said it is still cautious on both the company and the wider sector. Looking ahead, the analyst warned that oil and currency headwinds could become a bigger issue in 2026.
P&G’s stock has had a rough year. Shares are down close to 11% over the past 12 months as the company has had to operate in an inflation-heavy environment where shoppers are far more price-conscious. Consumers are actively trading down, comparing prices more often, and finding cheaper alternatives more easily than before. That pressure has forced P&G to maneuver more aggressively, and it has also contributed to a few quarters of revenue and profit coming in below expectations. What stands out is that the pressure has lasted longer than many investors expected when inflation first started pushing into the category.
Even so, P&G has still managed to grow. In its fiscal first quarter, which ended September 30, sales rose 2%. Price and mix each added 1 percentage point to growth, while volumes were flat. The company’s sales figures were also adjusted to remove currency translation impacts and the effect of acquisitions and divestitures.
The Procter & Gamble Company (NYSE:PG) is a global consumer products company that sells branded packaged goods across multiple categories to consumers around the world.
1. Johnson & Johnson (NYSE:JNJ)
Number of Hedge Fund Holders: 103
Consecutive Years of Dividend Growth: 63
On January 16, Johnson & Johnson (NYSE:JNJ) shared results from a new analysis of Phase 3 data showing that CAPLYTA (lumateperone), when used alongside an antidepressant, delivered significantly higher remission rates in adults with major depressive disorder compared with placebo plus an antidepressant after six weeks. The company also said the benefits held up over time, with continued improvement observed through six months in an open-label extension study. These results were included in one of 11 abstracts from Johnson & Johnson’s neuropsychiatry portfolio presented at the 64th Annual Meeting of the American College of Neuropsychopharmacology, held January 12 to 15 in Nassau, Bahamas.
Even with other corporate moves in the pipeline, including plans to spin off its orthopedics business, Johnson & Johnson’s main engine is still its ability to develop new medicines and advanced medical technology. Its pipeline and commercial products cover a wide set of areas, including immunology (rheumatoid arthritis, infectious diseases), neuroscience (schizophrenia, oncology, cardiovascular care), and metabolic conditions such as diabetes.
A major strength of the business is that demand for its products is not tied closely to the economic cycle. People do not stop needing treatment in a downturn, and for many patients, these therapies are essential. That stability continues to show up in the numbers. In the third quarter, Johnson & Johnson reported adjusted sales growth of 4.4% year over year, while diluted earnings per share jumped 15.7%.
Johnson & Johnson (NYSE:JNJ) and its subsidiaries develop, manufacture, and sell a broad range of healthcare products, supported by ongoing research and development across its businesses.
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