5 Dividend Kings To Buy For Safe Dividend Growth

In this article, we will discuss 5 dividend kings to buy for safe dividend growth. If you want to read our detailed analysis of dividend kings and the performance of dividend stocks, go directly to read 12 Dividend Kings To Buy For Safe Dividend Growth. 

5. Abbott Laboratories (NYSE:ABT)

5-Year Average Annual Dividend Growth Rate: 12.7%
Dividend Yield as of March 8: 2.05%

Abbott Laboratories (NYSE:ABT) is an Illinois-based medical device company that provides innovative medical solutions to its consumers. The company currently offers a quarterly dividend of $0.51 per share and has a dividend yield of 2.05%, as of March 8. The company is a dividend king with 51 years of consecutive dividend growth. Its 5-year average dividend growth stands at 12.7%.

In January, Barclays raised its price target on Abbott Laboratories (NYSE:ABT) to $125 with an Overweight rating on the shares, highlighting the company’s medical device growth.

As per Insider Monkey’s Q4 2022 database, 60 hedge funds tracked by Insider Monkey reported owning stakes in Abbott Laboratories (NYSE:ABT), compared with 62 in the previous quarter. These stakes are collectively valued at over $3.2 billion.

Vulcan Value Partners mentioned Abbott Laboratories (NYSE:ABT) in its Q4 2022 investor letter. Here is what the firm has to say:

“Abbott Laboratories (NYSE:ABT) is one of the largest and most diversified health care companies in the world. It operates in four segments: diagnostics, medical devices, nutritional products and established pharmaceuticals. The company quickly established itself as a global leader in the development and deployment of COVID-19 rapid diagnostic tests. Consequently, its revenue and profit growth accelerated during the pandemic. As demand for testing slowed to a more sustainable level, the company is facing difficult earnings comparisons. In addition, Abbott voluntarily recalled certain infant formula products and shut down a plant in Michigan where the products were manufactured, which put more pressure on its earnings comparisons. The plant has resumed production, and Abbott is regaining lost market share. We believe that these events, one positive and one negative, have distorted Abbott’s sustainable earning power and has given us an opportunity to purchase it with a margin of safety.”

4. Nordson Corporation (NASDAQ:NDSN)

5-Year Average Annual Dividend Growth Rate: 16.02%
Dividend Yield as of March 8: 1.17%

Nordson Corporation (NASDAQ:NDSN) is an American adhesive manufacturing company, based in Ohio. KeyBanc upgraded the stock to Overweight with a $255 price target. The firm appreciated the company’s ‘best-in-class’ returns and its constructive capital allocation.

Nordson Corporation (NASDAQ:NDSN) currently offers a quarterly dividend of $0.65 per share for a dividend yield of 1.17%, as of March 8. The company maintains a 59-year streak of consistent dividend growth, which places it as one of the best dividend kings for safe dividend growth. In the past five years, the company has raised its dividends at an annual average rate of 16.02%.

At the end of Q4 2022, 25 hedge funds in Insider Monkey’s database owned stakes in Nordson Corporation (NASDAQ:NDSN), compared with 26 in the previous quarter. The collective value of these stakes is over $284.3 million.

3. S&P Global Inc. (NYSE:SPGI)

5-Year Average Annual Dividend Growth Rate: 16.04%
Dividend Yield as of March 8: 1.05%

An American private banking company, S&P Global Inc. (NYSE:SPGI) ranks third on our list of the dividend kings to buy for safe dividend growth. The company has raised its payouts for 50 years in a row, with a 5-year average annual dividend growth of 16.04%. It currently pays a quarterly dividend of $0.90 per share and has a dividend yield of 1.05%, as recorded on March 8.

Following the company’s strong quarterly earnings and its outperformance last year, both Argus and Credit Suisse raised their price targets on S&P Global Inc. (NYSE:SPGI) in February to $400 and $395, respectively.

As of the close of Q4 2022, 97 hedge funds in Insider Monkey’s database reported having stakes in S&P Global Inc. (NYSE:SPGI), up from 90 in the previous quarter. With over 9 million shares, TCI Fund Management was the company’s largest stakeholder in Q4.

Andvari Associated mentioned S&P Global Inc. (NYSE:SPGI) in its Q4 2022 investor letter. Here is what the firm has to say:

“S&P Global Inc. (NYSE:SPGI) is another company we own that is part of a duopoly in the business of credit rating. S&P and Moody’s have roughly equal market shares and rate more than 90% of all bonds worldwide. The service provides high value for the cost. A company that chooses to issue debt without a rating will pay an interest rate that could be higher by half of a percent. The cost of a higher interest rate far exceeds any savings gained by not using the services of S&P.

We think of S&P as a toll road that earns fees from its customers in exchange for cost-effective access to capital. As such, the company has extraordinary margins and pricing power and requires little of its own capital to grow. Even after fully reinvesting in its business, S&P still has an excess of cash. In 2021, S&P produced $3.5 billion of free cash from $8.3 billion of revenues. The company returns the majority of its free cash to investors in the form of dividends and share repurchases.”

2. AbbVie Inc. (NYSE:ABBV)

5-Year Average Annual Dividend Growth Rate: 16.9%
Dividend Yield as of March 8: 3.97%

AbbVie Inc. (NYSE:ABBV) is an American multinational pharmaceutical company. The company is one of the dividend kings to buy for safe dividend growth as it has raised its payouts for 50 consecutive years. Its five-year annual average dividend growth stands at 16.9%. The company offers a quarterly dividend of $1.48 per share for a dividend yield of 3.97%, as of March 8.

In March, Guggenheim initiated its coverage on the stock with a Buy rating and a $172 price target, noting the company’s overall performance.

At the end of December 2022, 73 hedge funds in Insider Monkey’s database reported owning stakes in AbbVie Inc. (NYSE:ABBV), compared with 80 in the previous quarter. The collective value of these stakes is over $1.5 billion.

Baron Funds mentioned AbbVie Inc. (NYSE:ABBV) in its Q3 2022 investor letter. Here is what the firm has to say:

“AbbVie Inc. (NYSE:ABBV) is a drug developer best known for Humira, an immunosuppressant that is the best selling drug of all time. Given outsized key product risk (patent cliff and generic launches beginning in 2023), AbbVie has broadened its pipeline, highlighted by its Allergan acquisition. Shares fell on results that missed consensus and indications that legacy franchises were outperforming newer product launches, calling into question AbbVie’s long-term strategy. With promising assets in the pipeline and its robust cash flow profile, we believe AbbVie will grow well into the future.”

1. Lowe’s Companies, Inc. (NYSE:LOW)

5-Year Average Annual Dividend Growth Rate: 20.1%
Dividend Yield as of March 8: 2.08%

Lowe’s Companies, Inc. (NYSE:LOW) tops our list of dividend kings to buy for safe dividend growth. The home improvement company offers a quarterly dividend of $1.05 per share. It has raised its dividends consistently for the past 59 years, with a 5-year average annual dividend growth rate of 20.1%. The company’s shares have a yield of 2.08%, as of March 8.

Lowe’s Companies, Inc. (NYSE:LOW) was a popular buy among hedge funds in Q4 2022, as 68 funds tracked by Insider Monkey owned stakes in the company, up from 61 in the previous quarter. These stakes are valued at nearly $5.7 billion.

Pershing Square Holdings mentioned Lowe’s Companies, Inc. (NYSE:LOW) in its Q2 2022 investor letter. Here is what the firm has to say:

“Lowe’s Companies, Inc. (NYSE:LOW)’s is a high-quality business with significant long-term earnings growth potential underpinned by a superb management team that is successfully executing a multi-faceted business transformation. (Click here to read the full text)

You can also take a look at 30 Biggest SaaS Companies in the World in 2023 and 13 Best Annual Dividend Stocks to Buy Now

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