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13 Cheapest Dividend Aristocrats Right Now

In this article, we discuss 13 cheapest dividend aristocrat stocks to buy right now. You can skip our detailed analysis of dividend aristocrats and the performance of dividend growers over the years, and go directly to read 5 Cheapest Dividend Aristocrats Right Now

Dividend Aristocrats are a group of companies that have a history of consistently increasing their dividends for 25 consecutive years or more. Investors often view these stocks favorably because they are perceived as reliable income generators. The ability to consistently increase dividends over a long period is seen as a sign of financial strength and stability. In addition to this, these stocks have shown remarkable performance over the years, outperforming various other types of assets. As per a ProShares report citing data from Factset, the S&P 500 Dividend Aristocrat Index exhibited an impressive return of 27.7% from March 2022 to April 2023. In comparison, the broader S&P 500, during the same timeframe, delivered a slightly lower return of 25.2%.

These stocks not only delivered impressive returns in the recent past but have consistently outperformed since the inception of the index in 2005, particularly highlighting the sustained success of dividend aristocrats. The ProShares report further mentioned that since its launch, the S&P 500 Dividend Aristocrats Index has consistently outpaced the S&P 500, demonstrating reduced volatility and the potential to transform a $10,000 initial investment in May 2005 into over $61,000 by March 2023. The index boasts an impressive upside-downside capture of 91% and 80%, indicating robust performance in both bullish and bearish market conditions. The Procter & Gamble Company (NYSE:PG), Colgate-Palmolive Company (NYSE:CL), and PepsiCo, Inc. (NASDAQ:PEP) are some of the most prominent dividend aristocrat stocks among investors.

In the realm of dividend investing, a perpetual struggle exists between prioritizing high yields and emphasizing dividend growth. Investors hold divergent opinions on this matter, but analysts consistently advocate for companies exhibiting robust and consistent dividend growth. Dan Lefkovitz, a strategist affiliated with Morningstar’s Index team, has frequently expressed support for companies that consistently increase their dividends. In a recent report from the firm, the analyst said investing in dividend growth differs significantly from high-dividend investing. A portfolio focused on dividend growth indicates a company’s strong competitive position and improving fortunes. Such a portfolio tends to align more closely with the overall market in terms of sector exposures, growth and value characteristics, and metrics like price-to-earnings. While it may still lean towards value, a dividend growth portfolio is considered more balanced and core-oriented compared to a high-dividend portfolio.

Undervalued dividend aristocrats also often attract significant attention and interest among investors. They are drawn to the combination of income stability through dividends and the potential for capital appreciation as the market corrects its valuation. In this article, we will discuss some of the best dividend aristocrat stocks that are undervalued.

Our Methodology:

For this list, we scanned the list of the S&P 500 Dividend Aristocrats, the stocks that have raised their payouts for 25 years or more. From this group, we identified 13 stocks with the lowest price-to-earnings (P/E) ratios. The chosen stocks featured in the list exhibit a P/E ratio below 25 as of January 29th. The stocks are ranked in ascending order of their P/E ratios. We also mentioned hedge fund sentiment data for these stocks where available. Hedge funds’ top 10 consensus stock picks outperformed the S&P 500 Index by more than 140 percentage points over the last 10 years (see the details here). That’s why we pay very close attention to this often-ignored indicator.

13. W.W. Grainger, Inc. (NYSE:GWW)

P/E Ratio as of January 29: 24.6

W.W. Grainger, Inc. (NYSE:GWW) is a leading distributor of maintenance, repair, and operating (MRO) products. The company operates through various channels, including e-commerce platforms and traditional catalog sales. The company pays a quarterly dividend of $1.86 per share and has a dividend yield of 0.84%, as of January 29. It is one of the best dividend aristocrat stocks on our list as the company has been growing its dividends for the past 53 years.

The number of hedge funds tracked by Insider Monkey owning stakes in W.W. Grainger, Inc. (NYSE:GWW) grew to 32 in Q3 2023, from 28 in the previous quarter. The overall value of these stakes is roughly $332 million. Among these hedge funds, Marshall Wace LLP was the company’s leading stakeholder in Q3.

12. Emerson Electric Co. (NYSE:EMR)

P/E Ratio as of January 29: 24.5

Emerson Electric Co. (NYSE:EMR) is a global diversified technology company that operates in various industries, providing a range of products and services. In FY23, the company returned approximately $1.2 billion to shareholders through dividends and share repurchases. In addition to this, it has been growing its dividends for the past 67 consecutive years, which makes EMR one of the best dividend aristocrat stocks on our list. The company currently offers a quarterly dividend of $0.525 per share and has a dividend yield of 2.21%, as recorded on January 29.

As of the close of Q3 2023, 53 hedge funds in Insider Monkey’s database reported having stakes in Emerson Electric Co. (NYSE:EMR), growing from 49 in the preceding quarter. The consolidated value of these stakes is over $1.6 billion.

11. Pentair plc (NYSE:PNR)

P/E Ratio as of January 29: 23.44

Pentair plc (NYSE:PNR) is next on our list of the best dividend aristocrat stocks. The global company specializes in water treatment and fluid handling solutions. In 2023, the company achieved its 48th consecutive annual dividend growth. It offers a quarterly dividend of $0.23 per share and has a dividend yield of 1.27%, as of January 29. With a P/E ratio of 23.44, PNR is one of the best dividend aristocrat stocks on our list.

At the end of Q3 2023, 36 hedge funds tracked by Insider Monkey reported having stakes in Pentair plc (NYSE:PNR), up from 33 in the previous quarter. These stakes are collectively valued at over $1.57 billion. Among these hedge funds, Impax Asset Management was the largest stakeholder of the company in Q3 owning roughly 10 million shares.

10. International Business Machines Corporation (NYSE:IBM)

P/E Ratio as of January 29: 23.01

International Business Machines Corporation (NYSE:IBM) is a multinational technology and consulting company with a diverse range of business operations. The company’s current quarterly dividend comes in at $1.66 per share and offers a dividend yield of 3.54%, as of January 29. It has been rewarding shareholders with growing dividends for the past 28 years, which makes IBM one of the best dividend aristocrat stocks on our list.

As of the close of the third quarter of 2023, 53 hedge funds in Insider Monkey’s database owned stakes in International Business Machines Corporation (NYSE:IBM), growing from 51 in the previous quarter. The consolidated value of these stakes is nearly $843 million. With nearly 1 million shares, Marshall Wace LLP was the company’s leading stakeholder in Q3.

9. Dover Corporation (NYSE:DOV)

P/E Ratio as of January 29: 20.5

Dover Corporation (NYSE:DOV) diversified industrial manufacturing company that operates in various segments and provides a range of products and services. In November 2023, the company declared a quarterly dividend of $0.51 per share, which was in line with its previous dividend. Overall, the company maintains a 67-year streak of consistent dividend growth. With a dividend yield of 1.36% as of January 29, DOV is one of the best dividend aristocrat stocks on our list.

The number of hedge funds tracked by Insider Monkey owning stakes in Dover Corporation (NYSE:DOV) stood at 21 in Q3 2023, worth collectively $664 million.

8. Caterpillar Inc. (NYSE:CAT)

P/E Ratio as of January 29: 16.9

Caterpillar Inc. (NYSE:CAT) is a globally renowned company in the industrial sector, specializing in the manufacturing and selling of heavy machinery, construction equipment, engines, and related services. The company pays a quarterly dividend of $1.30 per share and has a dividend yield of 1.74%, as of January 29. It is one of the best dividend aristocrat stocks on our list with 29 consecutive years of dividend growth under its belt.

Insider Monkey’s database of Q3 2023 showed that 50 hedge funds owned stakes in Caterpillar Inc. (NYSE:CAT), which remained unchanged from the previous quarter. The total worth of these stakes is roughly $6 billion.

Diamond Hill Capital mentioned Caterpillar Inc. (NYSE:CAT) in its Q3 2023 investor letter. Here is what the firm has to say:

“Caterpillar Inc. (NYSE:CAT), the world’s leading manufacturer of construction and mining equipment, also performed well this quarter. Caterpillar has managed to leverage increased capital investment from various end markets, contributing to better than expected fiscal results for Q2. The company is poised to be one of the largest beneficiaries of several government funding initiatives, including the IRA (Inflation Reduction Act) bill, CHIPS Act and infrastructure bill. These measures are expected to support construction spending for several years, providing a robust backdrop for Caterpillar’s continued growth.”

7. Genuine Parts Company (NYSE:GPC)

P/E Ratio as of January 29: 16.10

Genuine Parts Company (NYSE:GPC) is a diversified distributor of automotive and industrial replacement parts, office products, and electrical/electronic materials. The company has always remained committed to its shareholder return as it distributed $393 million to investors through dividends in the third quarter of 2023. It currently pays a quarterly dividend of $0.95 per share for a dividend yield of 2.65%, as of January 29. With a dividend growth streak of 66 years, GPC is one of the best dividend aristocrat stocks on our list.

At the end of September 2023, 34 hedge funds in Insider Monkey’s database owned stakes in Genuine Parts Company (NYSE:GPC), which remained the same as in the preceding quarter. The total value of these stakes is roughly $525 million. Among these elite funds, Millennium Management was the largest stakeholder of the company in Q3.

6. Chubb Limited (NYSE:CB)

P/E Ratio as of January 29: 14.12

Chubb Limited (NYSE:CB) ranks sixth on our list of the best dividend aristocrat stocks to invest in right now. The global insurance company offers a quarterly dividend of $0.86 per share and it has raised its payouts for 30 consecutive years. As of January 29, the stock has a dividend yield of 1.42%.

Insider Monkey’s database of Q3 2023 indicated that 43 hedge funds owned stakes in Chubb Limited (NYSE:CB), down from 50 in the previous quarter. The total value of stakes owned by these funds is over $1.13 billion. With nearly 1 million shares, Polar Capital was the company’s leading stakeholder in Q3.

Click to continue reading and see 5 Cheapest Dividend Aristocrats Right Now

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Disclosure. None. 13 Cheapest Dividend Aristocrats Right Now is originally published on Insider Monkey.

AI, Tariffs, Nuclear Power: One Undervalued Stock Connects ALL the Dots (Before It Explodes!)

Artificial intelligence is the greatest investment opportunity of our lifetime. The time to invest in groundbreaking AI is now, and this stock is a steal!

AI is eating the world—and the machines behind it are ravenous.

Each ChatGPT query, each model update, each robotic breakthrough consumes massive amounts of energy. In fact, AI is already pushing global power grids to the brink.

Wall Street is pouring hundreds of billions into artificial intelligence—training smarter chatbots, automating industries, and building the digital future. But there’s one urgent question few are asking:

Where will all of that energy come from?

AI is the most electricity-hungry technology ever invented. Each data center powering large language models like ChatGPT consumes as much energy as a small city. And it’s about to get worse.

Even Sam Altman, the founder of OpenAI, issued a stark warning:

“The future of AI depends on an energy breakthrough.”

Elon Musk was even more blunt:

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One little-known company—almost entirely overlooked by most AI investors—could be the ultimate backdoor play. It’s not a chipmaker. It’s not a cloud platform. But it might be the most important AI stock in the US owns critical energy infrastructure assets positioned to feed the coming AI energy spike.

As demand from AI data centers explodes, this company is gearing up to profit from the most valuable commodity in the digital age: electricity.

The “Toll Booth” Operator of the AI Energy Boom

  • It owns critical nuclear energy infrastructure assets, positioning it at the heart of America’s next-generation power strategy.
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Wall Street is noticing this company also because it is quietly riding all of these tailwinds—without the sky-high valuation.

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The Hedge Fund Secret That’s Starting to Leak Out

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A New Dawn is Coming to U.S. Stocks

I work for one of the largest independent financial publishers in the world – representing over 1 million people in 148 countries.

We’re independently funding today’s broadcast to address something on the mind of every investor in America right now…

Should I put my money in Artificial Intelligence?

Here to answer that for us… and give away his No. 1 free AI recommendation… is 50-year Wall Street titan, Marc Chaikin.

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He’s used this system to survive nine bear markets… create three new indices for the Nasdaq… and even predict the brutal bear market of 2022, 90 days in advance.

Click to continue reading…